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The difference lies in the definition iteself. DPMO (Defects per Million Opportunities) talk about the defects while DPPM (Defectives parts per Million) talks about the defectives. Take an example: A car manufacturer produces 1000 cars with each car having 50 checkpoints. Hence Units - 1000 Opportunities - 1000*50 = 50000 Assume, 10 cars are defective while the total number of defects are 250 (i.e. these 10 cars cumulatively failed on 250 checkppoints). Hence Defectives - 10 Defects - 250 DPMO = 250/50000*1000000 = 5000 DPPM = 10/1000*1000000 = 10000 Typically in a service industry, Customer is more concerned with DPPM. For a service provider it makes more sense to look at DPMO. Even if they start working with DPPM, they will eventually have to drill down to the defects that are rendering the service as defective. Not sure if the same logic applies to manufacturing, but even though DPPM is an excellent metric to track the performance of the manufacturing unit, for any improvements you still need to look at DPMO.