Defect Rate Comparison: Statistical Confidence Analysis PPT

This PPT slide, part of the 72-slide Six Sigma - Confidence Interval Analysis PowerPoint presentation, presents a comparative analysis of defect rates between 2 distinct processes, labeled Process 1 and Process 2. Each process is evaluated based on sample sizes and defect counts, leading to the calculation of defect rates and their respective confidence intervals.

For Process 1, with a sample size of 10,000 and 50 defects, the defect rate is calculated as \( \hat{p}_1 = \frac{d_1}{n_1} = 0.005 \), which translates to 0.5% or 5000 PPM (parts per million). The slide outlines a 95% confidence interval for this defect rate, indicating that the true defect rate \( p_1 \) lies between 0.37% and 0.66%, or equivalently, between 3713 PPM and 6587 PPM.

Process 2 shows a different scenario with the same sample size of 10,000, but only 10 defects. The defect rate here is \( \hat{p}_2 = \frac{d_2}{n_2} = 0.001 \), equating to 0.1% or 1000 PPM. The confidence interval for Process 2 reveals that the true defect rate \( p_2 \) is between 0.05% and 0.18%, which corresponds to 480 PPM and 1838 PPM.

This slide effectively illustrates the statistical approach to understanding defect rates in processes, emphasizing the importance of confidence intervals in assessing the reliability of these rates. The differences in defect rates and their intervals provide critical insights for decision-making regarding process improvements or quality control measures. Understanding these metrics can help organizations identify areas needing attention and drive operational excellence.

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