Supply Chain DPMO
DPMO: Defects Per Million Opportunities
DPMO is a Six Sigma* calculation used to indicate the amount of defects in a process per one million opportunities.
To calculate: Total Number of Defects / Total Number of Opportunities for a Defect. Then multiply the answer by 1 Million.
The challenge here is determining exactly what qualifies as a defect. Some defects can pass through a quality inspection and have little impact on the end product. Other defects can result in re-work or scrap.
DPMO is sometimes used instead of Defect per Unit to allow for comparison between processes with different levels of complexity.
*Six Sigma uses statistical analysis to measure a companies performance by identifying defects in a manufacturing process. The goal of Six Sigma is to reduce process output variation to + or – three standard deviations. This results in no more than 3.4 defects per million opportunities.
SUPPLY CHAIN MANAGEMENT METRICS
- Backorder: Supply Chain Management
- Supply Chain Balanced Scorecard
- Bench Marking – Supply Chain Management
- Cycle Time – Supply Chain Management
- Supply Chain Definition and validation
- Supply Chain Fill Rate
- Supply Chain DPMO
- Supply Chain Management Finance Inventory
- Inventory ABC Classification
- Inventory Accuracy
- Inventory Turns
- Ontime shipping performance
- Perfect Order Measure
- Performance to promise
- Setting Goals for your Supply Chain Metrics
- Tranportation Metrics
- Supply chain Management Acronyms
- The Supply Chain Management