7.1 Operational Metrics: FPY/RTY/CoQ + review cadence

In high-volume manufacturing, standard "Yield" is a vanity metric. A production line reporting 99% Output Yield can still be bankrupting the company if 40% of those units required rework loops to pass. As a Quality Director, you must distinguish between making product and fixing product. Operational metrics are not just for accounting; they are the pressure gauges of the "Hidden Factory"—the invisible rework engine that consumes labor and reduces component reliability.

The Metrics Hierarchy

1. First Pass Yield (FPY) – The Capacity Metric

FPY measures the efficiency of a single station. It answers: "How many good units came out versus how many went in?"

• Formula: (Units Passed / Units Entered) * 100
• Use Case: Capacity Planning. It tells you if you can meet the shipping schedule.
• The Danger: FPY allows rework. If an operator re-tests a board 3 times to make it pass, FPY sees a "Pass." It hides the instability.

2. Rolled Throughput Yield (RTY) – The Reliability Metric

RTY measures the probability of a unit passing the entire value stream without a single touch-up, rework, or re-test. This is the truth metric.

• Calculation: RTY = Y(print) × Y(place) × Y(reflow) × Y(test)
• The Math of Failure:
  • If you have 5 process steps, each at 95% yield (which sounds good):
  • RTY = 0.95 × 0.95 × 0.95 × 0.95 × 0.95 ≈ 77%.
  • Reality: Nearly 1 in 4 units are being reworked. This is why "95% yield" is unacceptable in complex systems.

3. Cost of Quality (CoQ) – The Financial Metric

Quality is not free, but Poor Quality is expensive. CoQ is the total financial impact of the quality system.

• Good Cost (Investment):
  • Prevention: Training, FMEA, Fixture Design.
  • Appraisal: Calibration, Testing, Inspection labor.
• Bad Cost (Loss):
  • Internal Failure: Scrap, Rework, Re-testing, Downtime.
  • External Failure: RMA, Warranty, Liability, Brand Damage.
• The Rule: $1 spent on Prevention saves $10 in Correction and $100 in Failure.

Decision Logic: Which Metric When?

• IF you are measuring Line Throughput (can we ship?):
  • THEN Monitor FPY.
• IF you are measuring Process Stability (is the process healthy?):
  • THEN Monitor RTY. A drop in RTY precedes a drop in FPY.
• IF RTY < 90%:
  • THEN Stop the line. The rework loop is introducing latent thermal stress to the components (reducing life).
• IF CoQ > 5% of Revenue:
  • THEN The process is economically unsustainable. Initiate major Corrective Action.

Final Checklist

Metric	Focus Area	Critical Warning Sign	Strategic Action
FPY	Single Station Output	> 98% but High OT	Investigate re-testing loops
RTY	System Integrity	< 90%	Stop Line & Fix Root Cause
Scrap	Material Loss	Variance > 0.5%	Audit Red Bins / Trash
CoQ	Financial Health	Failure Cost > Appraisal	Shift budget to Prevention
DPMO	Process Capability	Rising Trend	Review Training/Calibration