What does DPMO mean?

In this Article

In this article you will learn…

• What DPMO means and what it's used for.
• How DPMO is defined.
• Potential pitfalls when using DPMO.

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What is DPMO?

DPMO — It stands for Defects Per Million Opportunities.

DPMO is used in certain industries as a benchmark for tracking process quality performance, in other words it’s a process capability measure.

It’s used when the quality of the output of a process is defined as good or bad, pass or fail. It’s a discrete metric.

Using a million opportunities is a way to compare different processes, which are more, or less complex than each other, and provide a so-called universal metric of comparison.

How DPMO is Defined

To see how DPMO is used, we have to lay a little groundwork and introduce the concepts of defects per unit and opportunities.

DPU — Defects per Unit

Let’s say you work in a hamburger restaurant, and you make 100 hamburgers in a day. Out of those, 13 end up thrown out and 87 are sold to customers. Therefore your defect rate will be:

$$\frac{13}{100} = 0.13$$

This is the starting point for calculating DPMO and it’s called Defects Per Unit, or DPU.

$$\text{DPU} = \frac{\text{Defective Units}}{\text{Total Number of Units}}$$

This means that your DPU for hamburgers is:

$$\text{DPU}_{\text{Hamburgers}} = \frac{13}{100} = 0.13$$

What Do We Mean by Opportunities?

Why did those hamburgers end up being thrown out?

There could be several reasons. Maybe they were too cold, or the bun was burned, or the relish was wrong. Say there are 15 ways a hamburger making process can fail, then there are 15 possible opportunities for failure for every hamburger made.

Comparing Process Failure Rates

We'd like to be able to compare our hamburger making process with other processes, making strawberry milkshakes for example.

Making a milkshare is a less complex process as it has only 5 opportunities for failure for every milkshake produced.

Let's say you make 150 milkshakes in a day and only 17 are thrown out. The DPU of this process is:

$$\text{DPU}_{\text{Milkshakes}} = \frac{17}{150} = 0.11$$

This seems like a better process than the hamburger making one. But is it really?

How can we make the comparison between the hamburger making and milkshake processes fair? — We use defects per million opportunities.

Finding the DPMO

DPMO is defined as:

$$\text{DPMO} = \text{DPU} \times \frac{1,000,000}{\text{Opportunities}}$$

For hamburger making, out of 100 ordered, 13 end up thrown out, with 15 opportunities for failure per hamburger made.

We can calculate the DPMO for the hamburger making process as follows:

$$\text{DPU}_{\text{Hamburgers}} = \frac{13}{100} = 0.13$$ $$\text{DPMO}_{\text{Hamburgers}} = 0.13 \times \frac{1,000,000}{15}$$ $$\text{DPMO}_{\text{Hambugers}} = 8,667$$

For strawberry milkshakes, of 150 ordered, 17 end up thrown out, with 5 opportunities for failure per milkshake made.

We can also calculate the DPMO for the strawberry milkshake process:

$$\text{DPU}_{\text{Milkshakes}} = \frac{17}{150} = 0.11$$ $$\text{DPMO}_{\text{Milkshakes}} = 0.11 \times \frac{1,000,000}{5}$$ $$\text{DPMO}_{\text{Milkshakes}} = 22,000$$

Contrary to our original assumption, the metrics suggest that the performance of our milkshake process is in fact significantly worse than for hamburgers.

Using DPMO the Right Way

There are a few pitfalls to be aware of when using DPMO. The main one is that it’s not well understood outside of quality specialists or those trained in Lean Six Sigma.

Another problem can be skewed metrics, a stacking of the deck in favour of certain processes caused by an over or underestimation of the number of failure opportunities in one or more processes.

If you change the number of opportunities for a process the DPMO metric will shift and you won’t have a stable benchmark.

Also, using it as a benchmark between organizations or widely different processes will be heavily influenced by the method used to estimate the number of failure opportunities.

You may decide to stick to basic DPU and just accept that making hamburgers is different from making milkshakes.

Converting between DPMO and Cpk / Sigma Level?

We could get into a discussion of how to translate from DPMO to Cpk or Sigma Level but that’s probably one for the experts.

It quickly gets into a hair-splitting discussion about statistics and the law of equivalence according to Motorla, the one and a half sigma shift, and other unhelpful things we can't cover here.

I suggest the whole discussion is best avoided.

If you have a discrete quality metric stick with DPU or DPMO if you prefer. If you have continuous quality metrics stick with Cpk or Sigma Level. You will save yourself a headache and avoid much confusion within your business.

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Related:

• DPMO Calculator >