Managing Supply Chain and Operations 1st Edition by Thomas Foster ,Scott Sampson,Cynthia Wallin,Scott Webb

Exercise 27

Quality is a critical component of evaluating supplier performance for an electronic manufacturing firm. Consequently, it monitors supplier part quality using a variety of measurements, two of which are the parts per million (PPM) defect rate and the percent PPM improvement. These measures are entered into a supplier scorecard every quarter. The following measurement criteria are used:


For the most recent reporting period, the number of defects equaled 2, the number of parts received was 200,000, and the PPM defect rate in the prior reporting period was 16. Update the supplier scorecard for these two measurements.