A METHOD OF RATING MANUFACTURED PRODUCT 365 



Example III — Rates for Comparing the Quality of Similar Product 

 Supplied by Different Organizations 



The rate can be used in like manner for comparing the quality of 

 similar product produced by different factories of one company or by 

 different companies when the several manufacturing units are governed 

 by the same set of specifications. 



As an example take the case of similar material supplied by three 

 independent companies. There are several factors to be considered 

 in constructing the rates. First of all, some standard of reference 

 must be chosen to represent zero on the rate scale. This might cor- 

 respond to the average performance of all companies, of the best com- 

 pany, the average of the two best, etc. Secondly, to show the degree 

 of control for each company, the limits should be constructed in- 

 dependently for each company above and below the individual ex- 

 pectancy levels of quality. 



The rating chart of Fig. 9 gives a quality picture for a particular 

 kind of material supplied by three independent concerns, two of which 

 are doing consistently better work than the third. Zero rate has been 

 chosen arbitrarily to represent the average base period performance 

 of the two best companies. The rate obtained monthly for any one 

 company thus reflects, by its numerical magnitude, the relation be- 

 tween this company's current quality and that chosen as the standard 

 of reference. 



Graphical quality reports of this sort are of value to purchasing 

 organizations in their relations with competing suppliers of similar 

 materials. 



Appendix 



Computation of Control Limits 

 Assume 



(1) R = corresponds to base period demerits per unit. 



(2) Control limits are to be set above and below some rate figure, 



Re, corresponding to expected demerits per unit. (If 

 expected quality is the same as base period quality, then 



Re = 0.) 



(3) Control limits are to be computed for monthly rates. (The 



procedure is similar for any other period of time.) 



The following symbols will be used : 

 w = weight (demerits per defect) for a given type of defect. 

 d = expected number of defects per month, for a given type. 

 D = wd = demerits for d defects. 



