DPMO versus ppm

DPMO and ppm are two very commonly used metrics that define the quality of products/services. They are very
close to each other and often confuse users. We will compare the two metrics and find out the key differences
between the two
DPMO
DPMO or Defects per million opportunities is very commonly
used in the Six Sigma world. Based on DPMO, one can find
the sigma level of the process.

Ppm
Ppm or parts per million is used by manufacturers
worldwide to determine the current level of quality
of products or services.

Smaller the DPMO, larger is the sigma level i.e. less defects, Smaller the ppm, better is the quality.
better quality.
The goal for any process is to achieve 0 ppm.
For a process to be world class quality, it has to produce only
3.4 defects per million opportunities.
Ppm calculation:
DPMO calculation:
Ppm = (Number of defectives/quantity inspected)
Define the number of defects you expect in a part. This
x106
becomes the number of defect opportunities
DPMO = (number of defects/quantity Inspected x defect
opportunities) x 106
Ppm uses the number of defectives in a part or
DPMO uses number of defects in a part or unit.
unit. Each part or unit is a single defective.
Each part or unit can have multiple defects.
Total number of defectives cannot be more than
Total number of defects observed in the quantity inspected
the total quantity of parts inspected
cannot be more than the total defect opportunities which is
quantity inspected x defect opportunities.
Ppm is a more realistic measure of the overall
DPMO depends on the defect opportunities which are pre
quality of parts as it is the ratio of the defective
defined and can be changed. By increasing the defect
quantity and the total quantity inspected.
opportunities per part/unit, the DPMO can be decreased for
Ppm will reduce only when the number of
the same number of defects and quantity inspected.
defectives reduce or quantity inspected increases
(increase sample size - check more parts)
Example:
Defects observed = 20
Quantity inspected = 1000
Defect opportunities per part = 10
DPMO = (20 / (1000 x 10)) x 106
DPMO = 2000

Example:
Defectives observed = 30
Quantity inspected = 500
Ppm = (30 / 500) x 106
Ppm = 60,000

If defectives observed becomes 10 in 500 parts

For the same data, if defect opportunities per part is 50, then that are inspected
DPMO = (20 / (1000 x 50)) x 106
Ppm = (10 / 500) x 106
DPMO = 400
Ppm = 20,000
Or if 30 defectives are observed in 1000 parts,
then
Ppm = (30 / 1000) x 106 = 30,000

Conclusion:
Both DPMO and ppm are used for determining the overall quality of parts produced in the sample quantity
inspected. Six sigma experts believe in DPMO to find process sigma. Ppm levels are pretty common to monitor
quality of parts in production. Ppms determine the quality levels on the line. As DPMO is inversely proportional to
the defect opportunities per unit, it can be manipulated by changing defect opportunities per unit. This is possible
as defect opportunities per unit are defined by users before doing the DPMO calculation. We are not saying that
ppm is better than DPMO or vice versa. We are just listing down the way these two metrics work and how to
interpret them.