Revealing Hidden Efficiencies: Rolled Throughput Yield vs. First Pass Yield

It’s natural to focus on the final outcome of your process, particularly the frequency of achieving a perfect result. But what if I told you, this approach might be missing a crucial aspect?

When solely observing the process capability as measured by the end result, it’s likely you’ll find a commendable first-pass yield rate. This is the yield after inspection tests, before reaching the customer, and often it’s satisfactory, maybe around 90% quality even for a transactional process like a sales transaction. But, this perspective risks overlooking the hidden factory. So, what happens when items further back in the process are inspected, found to be deficient, and subsequently reworked?

The Hidden Factory Unveiled

Consider a sales process – successful sales, excellent margins. The first pass yield looks impressive! But, could there be a hidden factory further upstream? Are the employees exerting more effort than necessary to assemble the sale? Are there numerous errors, reworks, and back-and-forths occurring backstage? This is the hidden factory.

Surprisingly, this is an insightful perspective for understanding your process. You can imagine any process as a factory, regardless of whether your product is a physical good, a service, or even a knowledge transfer. The concept of producing something, even customer confidence, can align with the process capability measured using the first-pass yield approach and would appear satisfactory to most businesses.

Introducing Rolled Throughput Yield

However, if you measure your process capability at each step of the process, you can gain an accurate measure of your process’s performance. This measurement, known as the rolled throughput yield, is the multiplication of the yield from each step of the process, rather than just the final test yield. The major advantage of focusing on rolled throughput yield is the elimination of the hidden factory! Though, be prepared, it might not look pretty at first!

The First Pass Yield vs. Rolled Throughput Yield

Imagine a performance board displaying a process capability chart, showing control performance. It would likely showcase a pleasing control chart. But, visualising the same performance board using a rolled throughput yield approach can provide a completely different perspective on process capability.

This approach would allow you to quickly pinpoint the location of your hidden factory. Thus, marrying the concept of process capability with rolled throughput yield becomes a powerful tool to uncover the real efficiency and potential improvements in your process.

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Respect,

Taylor.