Key Performance Indicators Presented by: Ricky Smith CMRP May 7, 2009
“ The problem with Management is they’re
measuring the wrong things.”
― Peter Drucker
Leading KPIs – “MAINTENANCE PRACTICES” MTBF Rework Scheduled Compliance % of Planned Work PM/PdM Compliance No Defects Cost
Lagging KPIs Leading KPIs Leading KPIs Leading KPIs Leading KPIs Lagging KPIs
Leading and Lagging KPIs
Metrics – Leading and Lagging Leading KPI Key Performance Indicator World Class Target Level Lagging KPI 1 Cost Maintenance Cost Flat or decreasing Total Cost 2 Cost Maintenance Cost / RAV 2 - 3% Total Cost/ RAV 3 Cost Maintenance Material Cost / RAV .25-.75% Maintenance Cost / RAV 5 Cost Maintenance Cost per Unit Output Context specific Total Cost per Unit Output 6 Cost Maintenance Cost / Total Sales 6 - 8% Total Cost per Sales 7 Reliability Mean Time Between Failure (MTBF) Context specific Maintenance Cost 8 Reliability Failure Frequency Context specific Maintenance Cost 17 Reliability % of Assets with No ID Defect 95% Maintenance Cost - Capacity 9 Production Production Efficiency 99% Total Cost per Unit Output
How do you determine which metric to use?
On any process ask the question “how will you know if the process is effective?”
Identify in a process map where a metric is needed
Identify which metrics are KPIs
Be sure the metric you chose drives the right behavior, ie. PM Compliance
Driving the right behavior
Does it tell you anything?
Yes, it provides information which tells if the PM is completed – but with how much variation?
PM Compliance with the 10% Rule
PMs are completed within 10% of the time frequency
Example = 30 Day PM
10% Rule = 3 days to complete
May 2 May 28 June 1 June 28 July 28 July 4 3 day PM 58 day PM
What is it you really want to know?
Is your PM Program Effective?
What metrics would measure effectiveness
PM Labor Hours vs EM Labor Hours
Steps to Success
Map your processes and identify leading and lagging KPIs in them
Be sure and have clear definitions of your KPIs
Assign RACI to metrics
Develop scorecards from lowest level to highest (4-6 KPIs)
“ The problems we face today cannot be solved with the same level of thinking we were at when we created them.”
Email me at [email_address]
Questions? % of Assets with No Identifiable Defects