KPIs in Operations

For most manufacturing operations, KPIs should be established in the core manufacturing actions of the business.

All personnel should be able to identify KPIs and understand how they personally connect with those metrics.

We strongly recommend establishing at least one manufacturing measurement that is treated as critical to the health of the business and safety and quality of the product, and where possible, between 2 and 5 metrics in addition to any administrative or financial metrics.

So let’s look at some common KPIs for operations within a quality management system, and how we can track them.

The Most Common KPIs in a Quality Management System

The most common key performance indicators in a quality management system are customer complaints, or negative customer feedback, as well as operational non-conformances.

These are two examples of negative KPIs, in that we are tracking undesirable outcomes as a key measure of the business.

As we have discussed in our other videos, where we track parameters like complaints and non-conformances, we cannot expect that we will ever get to zero, as everyone who has spent any time in any factory will tell you.

Instead, we need to establish a baseline for complaints, and a baseline for non-conformances.

We need to set the metric at a realistic level.

The same is true for non-conformances. If operations has several non-conformances a week, that may look bad on paper, but where it corresponds to satisfied customers and healthy revenue, it may just be a sign of complex and difficult manufacturing.

What gets measured gets managed and improved.

Training on KPIs should be regularly scheduled, and possibly even frequent, to keep them front of mind.