KPI Development and Reporting
“What interests my boss fascinates me” a platitude most certainly but that doesn’t stop it being absolutely spot on.
In a reactive environment all KPI’s are lagging. This means that they record the performance of the organisation. Examples of laggings KPI’s are maintenance costs and mean time between failures.
In a proactive environment there is a mixture of leading and lagging KPI’s. Leading KPI’s are those that lead to the performance of the organisation. Examples of leading KPI’s are schedule compliance and percentage of PM’s completed on time.
Leading KPI’s are used by managers to quickly identify when a part of the process is not working optimally. They can then manage this poor performance before there is a significant change in the lagging KPI’s.
For people to be able to use their KPI’s to manage their portion of the business they must have KPI’s that are relevant and manageable for themselves.
This results in many positions throughout management down to technician level having their own dashboards which comprises of both lagging and leading KPI’s.
Dashboards should consist of KPI’s that direct attention and focus to the areas that are important to the company. They can also change over time as the priorities change within an organisation. To complete the review and improve cycle there must be action taken in response to low KPI’s. This will also enable the effects of any changes in process, management or performance to be measured and quantified.
Using a mixture of lagging and leading KPI’s will show the bigger picture. For example if maintenance costs reduced by 10% in a year that would be cause for celebration and perhaps promotion. However if the schedule compliance, percentage of PM’s completed on time and the mean time between failures all trend downwards the accomplishment wanes somewhat. This would show the bigger picture to be that the maintenance costs were cut, less proactive maintenance was completed and that the equipment is not going to be available when required. It would also suggest that bigger maintenance costs will be required in the future as there will be more failures and more urgent reactive maintenance which results in higher costs and less uptime.
A Reliability Engineers dashboard may contain
- Bad actors report of top ten critical assets with the highest maintenance costs and worst reliability.
- MTBF by asset and system.
- Percentage of critical equipment with a maintenance strategy developed using an RCM methodology
- Percentage of new equipment with a maintenance strategy developed using an RCM methodology and ranked based on the criticality to the business.
A Maintenance Manager dashboard may contain
- MTBF by asset
- Maintenance labour costs (measured against a target)
- Maintenance material costs (measured against a target)
- Maintenance contractor costs (measured against a target)
- Percentage of overtime
- Percentage of absenteeism
- Number of discipline violations
- Number of safety incidents
- Number of days without a lost time incident
An Engineering Managers dashboard may contain
- Percentage of total projects completed on budget.
- Percentage of total projects completed within 10% of budget
- Value of overspent budget for total projects by month and year.
- Percentage of projects started up on time and with full capacity.
- Value of change orders by month, project and year.
- Percentage of projects started up on schedule with maintenance strategy developed with an RCM methodology.
- Percentage of projects started up on schedule with all P&ID’s, line diagrams and Operating guides updated.
- Downtime percentage of new projects for the 1st year of operation.
- Production losses for a new project for the 1st year of operation.
- Percentage of projects with 80% of operating procedures developed prior to the scheduled start up.
- Total MTBF for all new projects for the 1st and 2nd year of operation.
Each roles dashboard is personal to that role but there are overlaps and interfaces which drive the same goals throughout the organisation.
The KPI’s on the Engineering Managers dashboard relating to production losses, maintenance strategies and MTBF’s drives the engineering team to understand and take ownership of the impact their designs have on the plant.