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Aims & Objectives : How to define & measure our given business goals
Why have KPIs How clarity of objectives improves motivation and delivers performance Standardised approaches to KPIs How to translate and cascade KPIs at all levels Explain links to Performance Management
Introductions
Flip Chart
IMPORTANT TO THE VIEWER VITAL - AFFECTS THE BUSINESS CUSTOMER FOCUSED DRIVES IMPROVEMENT
USEFUL
CURRENT - UP TO DATE EASY TO UNDERSTAND IMPORTANT AND RELEVANT VIEWER CAN CONTRIBUTE HAS A STAKE CAN HAVE AN EFFECT (good and bad)
IMMEDIATE
URGENCY / OWNERSHIP RESPONSIBILITIES DEFINED DYNAMIC IMPROVEMENT PLAN AUDIT PROCESS - ACTUAL Vs PLAN CLEAR OBJECTIVES
Examples
Actual Performance Plotted Against Target
Jul
Mar
Sept
May
Nov
Jan
Jul
Sep
Target Improvement
Machining Test
Assembly
Nov
100 0
Examples
RAG Colour Coding
RED Outside of target with no improvement or deteriorating trend. AMBER Inside of target but with deteriorating trend. Outside of target but with improving trend. GREEN Inside of target with improving or level trend.
Examples
Scrap Cost 2004
16000
YTD Scrap Cost: 34.0k
80 70 60 50 40 30 20 10 0 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Scrap Cost Scrapped Items Budget
No. Of Items
Examples
How are we doing Schedule against the plan? Are we on target?
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
Stage 1
Stage 2
Stage 3
Examples
External Supply Schedule Adherence
What are we aiming for?
100%
80%
60%
40%
20%
0% 23 24 25 26 27 28 29 30 31 32 33
Supplier 1 Supplier 2
Supplier 3
Supplier 4
Supplier 5
Examples
WIP
9000 8000 7000 2.5 '000 5000 4000 3000 1 2000 1000 0 Nov 99 Jun 00 Sep 00 Oct 00 Nov 00 36951 37043 0.5 0 2 1.5 Stock Turns 6000 3.5 3
Examples
% TAKT ADHERENCE
130
125
120
115
110
105
100
95
90
85
80
75
70
65
60
55
50
45
40
35
30
25
20
15
10
5
DAY
DATE
SHIFT
Examples
Step 3 - Assembly Managers review Weekly Performance withManagers. Cost accountability introduced. Focus on shift by shift performance.
Manhours (Shift B)
3,200 3,000 2,800
2,600
2,400
2,200
2,000
Jan
Feb
M ar
A pr
M ay
Jun
&
Jul
A ug
Sep
Oc t
Nov
Dec
2,000
10 0
80
Sep
Oct
Nov
Dec
60
P e r i od
40
Week V ar iA dded o 32. 1 anc e t V al ue W eek Di s r ual Cumul at i v e A c tupt i on - E x t er nal For ecas t 32. 1ec asrt es h For Ref (Lean)
12
13
14
15
16
Direct
17 18
19
11
20
21
13
Out OfWeek V ar i ance t o 32. 1 Ref r esh ai ni ng Ji g Tr Week Di sr upt i on - at i v e nal B udget Cumul I nt er B udget 32. 1
22
23
15
Indirect
24
( 1. 2 )
17
25
26
19
27
21
28
29
23
NPO
25
27
29
Disruptio
Step 5 Senior Management Team reviews Monthly performance Production Volume Senior level escalation plans. Hours per Set
350 300 250 200
6, 500 6, 000
250
2 1. 5 1 0. 5 0
200
-0 . 5
150
4, 000 3, 500
100 50 0
-1 - 1. 5 -2
100
50
J an
J an Feb M ar A pr
Feb
M ar
A pr
M ay
Jun
Jul
A ug
Sep
Dec
Oc t
Nov
Dec
0 Jan
Feb
Period Variance (32.1) J un J ul A Cumulative ug Sep Oc t Nov Actual Nov Dec Stage 1 Stage 2 Stage 3 FAL Budget (32.1) Forecast Di ti OBP
M ay
M ar ActualA pr M ay J un J ul A ug Sep Oc t Disruption
Step 6 - Site Cost Performance consolidated. Manufacturing Director reviews Factory Manager Performance. Forecasts of cost performance compiled to ensure corrective actions taken to achieve Budget. Risks & Opportunities monitoring and control.
Cumulative actual
Flip Chart
Monitor Progress To Plan And Take Corrective Action Form Improvement Teams
ACT
Form Team
PLAN
Collect Data
Score & Prioritise KEY Performance Indicators Identify owners and users
Train Users
Form Team
Define Local Performance Indicators Score & Prioritise KEY Performance Indicators
Form Team
Define Local Performance Indicators Score & Prioritise KEY Performance Indicators Identify Owners and Users
Example
KPI : Key Performance Indicator
4 5
28
29
30
31
Week
OSS Internal MSE Shop Support A B C D E F MCC Trefn TAC G H I J K L M
Handling
2
Owner:
Form Team
Define Local Performance Indicators Score & Prioritise KEY Performance Indicators Identify Owners and Users
Train Users
Form Team
Define Local Performance Indicators Score & Prioritise KEY Performance Indicators Identify Owners and Users
Collect Data
Train Users
Monitor Progress To Plan And Take Corrective Action Form Improvement Teams
Form Team
Define Local Performance Indicators Score & Prioritise KEY Performance Indicators Identify Owners and users
Collect Data
Train Users
Typical KPIs
KPI - examples
Quality Defects
(Defects per unit)
Errors
(errors per unit)
Cycle Time
(Hours per Unit)
Cost Manning (man hours per set) (Cost per unit) People Skill Level Training Hours
270 hours per unit 5,000 per unit 75% people trained to Practitioner Level 40 hrs per man per year
KPIs
SUMMARY
Direct relationship to business plan Communicates progress against plan Drives continuous improvement Visual - provokes a response Effective - simple and easy to understand Ownership - relates to everyone Up to date - dynamic management