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6-430 Evaluating The Contractor's Quality Control. Just as the contract
should contain performance requirements for each required end item of
service, the contract should also contain a performance requirement for the
contractor's quality control activities. That performance requirement is
the maximum allowable defect rate (MADR). Since the quality of the
contractor's work is a measure of the effectiveness of his quality control,
MADRs are expressed in terms of the work and establish quality bench marks
fore each contract requirement.
The advantages and disadvantages of a number of surveillance techniques are
listed at 4-300.  They will not be reviewed here, but to illustrate the
process of evaluating the contractor's quality control, the following
examples, using different sampling methods, have been prepared:
(a) 100 Percent Inspection. The defect rate when 100 percent
inspection is used, is determined by dividing the number of defects by the
total number of occurrences of the work requirement .  The following example
illustrates the computation.
CONTRACT REQUIREMENT: CHANGE OF OCCUPANCY
Sampling Method:  100 Percent Inspection.
Population: 30
INSPECTION RESULTS:
QUALITY
DEFECTS
DEFECT
CONTROL
IN
WORK
MADR
RATING
REQUIREMENT
SAMPLE
RATE
UNSAT
0%
13.33%
A. House ready on time 4
UNSAT
2%
16.66%
5
B. Quality work
Because 100 percent inspection was used, the observed defect rate (ODR) and
the defect rate (DR) are the same.  However, when other types of sampling
are used, the ODR and the DR are not necessarily the same as shown in the
examples below.
(b) Planned Sampling. When planned sampling is used, the defect rate
is calculated by dividing the total number of defects (both inside and
outside the sample) by the total population of services.
CONTRACT REQUIREMENT: PICK UP GARBAGE CONTAINERS
The contractor is required to pickup 600 containers at various locations at
a Naval Air Station.
Sampling Method:  Planned Sampling.
Population:  600 containers X 12 pickups per month = 7200
Number of Services sampled: 720 (10% of the population)
MADR: 0.2%
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