My wife recently sent me to the grocery store to buy cream cheese. She said to me “Buy Brand X because they have a higher supplier and process Ppk and Cpk. Brand X always works in this cheesecake recipe.”
She didn’t utter those words explicitly, but, that was what she was implying in her statement about the cheesecake recipe as it relates to this certain brand of cream cheese. She was interested in the end result, and Cpk and Ppk get you there.
With that said, what are Cpk and Ppk, and why do they matter in the supply chain?
Define Cp and Cpk
Cp and Cpk are defined as Process Capability and Process Capability Index. Below is a nice definition that I found on the isixsigma website:
“If you hunt or shoot targets with bow, darts, or gun try this analogy. If your shots are falling in the same spot forming a good group this is a high Cp, and when the sighting is adjusted so this tight group of shots is landing on the bullseye, you now have a high Cpk.”
In this example, your process is running consistently, but off target. To correct for this, adjust the process so that it runs on target.
Another definition on this site is:
“You must have a Cpk of 1.33 [4 sigma] or higher to satisfy most customers.”
Define Pp and Ppk
Pp and Ppk are Process Performance and Process Performance Index. This definition comes from Wikipedia,
“In process improvement efforts, the process performance index is an estimate of the process capability of a process during its initial set-up, before it has been brought into a state of statistical control.”
This is a slightly more esoteric definition, as Ppk does not necessarily need to be used if the production line or materials cannot be measured using Cp and Cpk. Ppk seems to be able to provide some additional indications for more fine tuning. Again, referring to an analogy in iSixsigma,
“Ppk produces an index number (like 1.33) for the process variation. Cpk references the variation to your specification limits. If you just want to know how much variation the process exhibits, a Ppk measurement is fine. If you want to know how that variation will affect the ability of your process to meet customer requirements (CTQ’s), you should use Cpk.”
This is the critical difference between the two.
Why Is This Important To My Wife (and should be an important supply chain metric for manufacturers)
The key in each of these definitions comes when evaluating processes against customer requirements. Clearly, it is in my best interest to purchase Brand X for a couple of reasons:
- My wife makes amazing cheesecake and the ingredients are important.
- I don’t want to have her waste other ingredients because she is using an “inferior” product.
These two statements reflect why these measurements are so important. For manufacturers where the inbound material characteristics are germane to the finished good characteristics, measuring material/ingredient Cpk and Ppk provides insight into your suppliers manufacturing processes. Over time, it provides the ability to trust the supplier because you will know that they can consistently produce materials/ingredients that ultimately meet your customer requirements.
Whether you produce gum, paint, tires or dog food, using Cpk and Ppk as a supply chain metric enables you to connect supplier material quality to finished good quality.