if My Target of PPM = 1% & I get 1.5% as Actual

Than what will be my COPQ = 1.5% or 0.5% ???

 

Hi Yogesh,

I give 2 different situations with COPQ as 1.5%

Situation 1: Product is Potable water : Test case : Water impurity is 1% or less.

If the CTQ is the impurities in water and if you want to test the impurities present in a water sample and the CTQ meaure is the % of impurities in water and the target is 1% and if the allowable impurity ( upper spec limit) limit is 1% only, then the enitre lot of water will be rejected if the impurity present in the sample is 1.5% and your COPQ will be the cost enitre lot of water.

Situation 2 : Product is paper plate: Test case: Paper plate is torn or not.

Target is 1% defectives out of million plates. That is .o1x1000000. Target # of defectives  = 10,000

Actual defectives are 1.5% out of Million paper plates. That is 15,000 defectives. All defective plates will become Cost of Poor Quality(COPQ)

Here again, the COPQ is 1.5%.

Hope this helps.       

Thankyou Ondiappan sir,

I got your intention.

Actually I am in automobile manufacturing industry,so situation no.2 suits to me.

So sir as per you , COPQ=1.5% , Rej. PPM Target = 1%

it means my COPQ meter will automatically gets start, if I am more than from zero & it does not matter whether I am under my specified Target range or not. Pl correct me if I am wrong.

if it is so than what 1% (Target) stands for ??

 

 

Hi Yogesh,

Can you clearly explain / give more information on the situation where you came across this 1% target  so that we can analyse and provide you an answer.

 

COPQ, is actually what you lose out of this. Out of all 1 Lakhs Plated delivered to the client you have 15k as defective, which is 1.5% and you get paid for only 85k plates so the loss made by you is worth 15k. you have already Upper limit of 10k, which means this is accomodated in profitability but another 5k is not. So here additional loss is 5k. In Actual COPQ is 1.5% which is cost of 15k plates.

To think differently, What if customers cancels entre future contracts due to this addition 5K defected plates, what you lose and what is COPQ?

Sirs,

Thanks for your valuable comments.

I am in NPD(new product development) in Automobile sector (Tier-1 supplier to OEMs).

Actually sir, Management has given me the Target to start COPQ for my dept & show in MRM(Mgmt review meeting).

For that I am looking for  :-

1. how to start it.

2. what are the contents include in COPQ.

3. What is the % of COPQ of a world class company.

 

Yogesh,

Generally COPQ is always looks at re-work done in any industry.  There is a specific cost given to any product / lot.

1. Talk about what is COPQ

COPQ is dependent on the OFE in a process, Wastages and defects.

Try to show what are the various OFE's in your process and where are wastages happening and current defects that the organization is having.

3.  COPQ is always independent, it varies from client to client or customer to customer.

 

 

 

Dear Mr. Hussain,

Thanks for your guidance.

By the way what is OFE stands for??

 

OFE is abbreviated as Opportunity For Error.

If we have 100 steps to perform in a process then we would like to see in how many steps there is probability or possibility of commiting a mistake.

This would let you know how many errors would be present in product at maximum extent if all these OFE are occured. i.e., maximum damage could happen to a product or service.

Based on that we would try to come up with pareto in terms of OFE to check which OFE is causing more damage to our product or service.

Looking at the pareto chart we would come to a conlusion of which OFE need to be addressed first and call for a Brainstorming session to identify the root causes of the OFE.

Based on the root cause we would try to put control to eradicate or reduce the OFE %.

Hope this would help you.