Determining what type of scrap to include in my internal PPM calculation

#1
I need some help determining what type of scrap to include in my internal PPM calculation. An example, we have 10 components that go into a complete assembly. If one component is scrapped, that quantity is now counted against our internal PPM. My argument against this method is that single component is not a saleable component itself, so should not be counted towards internal PPM. Thoughts?
 
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qualprod

Trusted Information Resource
#3
How good do you want the number to be? :)

I'd start broad and drill down from there as necessary.
I need some help determining what type of scrap to include in my internal PPM calculation. An example, we have 10 components that go into a complete assembly. If one component is scrapped, that quantity is now counted against our internal PPM. My argument against this method is that single component is not a saleable component itself, so should not be counted towards internal PPM. Thoughts?
It depends of what you need, for example, imagine what is the scrap quantity you are accepting.
Could be 3%? Maybe 3 or 5?.
What is your real problem? additionaly, There are some processes that for it's nature, manage an allowed scrap, for testing, for the setup or adjustments.
 

somashekar

Staff member
Super Moderator
#4
I need some help determining what type of scrap to include in my internal PPM calculation. An example, we have 10 components that go into a complete assembly. If one component is scrapped, that quantity is now counted against our internal PPM. My argument against this method is that single component is not a saleable component itself, so should not be counted towards internal PPM. Thoughts?
Its not a salable component sure, but you would have paid for it something.
I would go with cost as a baseline for prioritizing.
This way your focus will also be on the high cost components that account for your high PPM
 

Miner

Forum Moderator
Staff member
Admin
#5
I would decide on the behavior that you intend to drive and where you want to focus that attention. Is it on cost or on quantity? Is it only on the finished product, or on all product, components included. Once you have decided that, select the metric that will drive that behavior.

From a technical perspective, if you are going to track component defectives in the numerator, you should also track component quantities in the denominator. Be consistent in what you include in both.
 

Mike S.

Happy to be Alive
Trusted Information Resource
#6
Miner is on the right track, IMO.

There is no reason to record or track data unless you are required to by contract or you intend to do something with the result. Under what circumstances would you decide to do something about a scrap number? Only you and your company can answer this. If you had 20 screws at $1 each scrapped in a week would you act on it? What if you had 20 housing assemblies at $1000 each? Do what makes sense for your business.
 
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