Discussion about some of the Production Key Performance indicator (KPI) and detailed calculation technique

1. Navneet Dwivedi
PGDM-Operations and Supply Chain

2.  To define few Key Production Performance
Indicators (Production KPIs)
◦ OEE (Overall Equipment Effectiveness)
◦ Direct Efficiency
◦ Productivity

3.  Direct Efficiency
 Productivity
Efficiency of workers
involved in production
activity only
Efficiency and effectiveness
of all the workers enrolled
in the company
Efficiency ?? Effectiveness??
Ratio of input and output
Ability to do thing correctly

4. Direct Efficiency=
𝑇ℎ𝑒𝑜𝑟𝑒𝑡𝑖𝑐𝑎𝑙 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑 𝐻𝑜𝑢𝑟𝑠
𝑊𝑜𝑟𝑘𝑒𝑑 𝐻𝑜𝑢𝑟𝑠
Productivity=
𝑇ℎ𝑒𝑜𝑟𝑒𝑡𝑖𝑐𝑎𝑙 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑 𝐻𝑜𝑢𝑟𝑠
𝑃𝑎𝑖𝑑 𝐻𝑜𝑢𝑟𝑠

5. Theoretical Produced Hours ??
Paid Hours ??
Worked Hours ??
Direct Presence Hours
Delegation Hours
Standard Hours

6. Punching
(2 min)
Trimming
(1 min)
Drawing
(3 min)
Buffing (2
min)
Packaging
(2 min)
Cutting
(1 min)
Deburring
(1 min)
Drilling
(3 min)
Bending
(5min)
Washing
(2 min)
(a)
(b)
Process Process Flow Total
Time
10 min
12 min
Thus we have Total Time Cycle for Process (a) TTCa =10 minutes
Total Time Cycle for Process (a) TTCb =12 minutes
Standard Hour (Item (a) STHa= (10/60) =0.1667 hrs/unit
Standard Hour (Item (a) STHb= (12/60) =0.2 hrs/unit

7.  Daily Production Report
Manpower Details Production Quantity
Total Enrolled (TE) 11 Item (b) Item (b)
Total Present (TP) 10 Total Produced 183 100
Setup Man 1 Good Items 180 100
Short Leave (hrs) (SL) 4 Scrap 3 0
Overtime (hrs) (OT) 1 Total Time Cycle (min) 10 12
Delegated to Other Dept.
Department Nos Duration(hrs) Manhours
Stores 1 8 8
Technical
Quality 1 4 4
Washing
Rework
Admin Work 2 4 8
Other Misc
Shift Time (ST) 8.5
Break Time (BT) 0.5

8. Summary Report
Shift Time 8.5
Break Time 0.5
Net Shift Time 8
Production Hour 50
Direct Presence hours 77
Delegated Hours 20
Worked Hours 57
Paid Hours 90.5
Direct Eff. 87.7%
Productivity 55.2%
Production Hour= (STHa*Qtya) + (STHb*Qtyb
= ((10/60)*180)+ ((12/60)*100)
= 50 hrs
.
Net Shift Time(NST)=Shift Time-Break Time
=8.5 -0.5= 8 hrs
Direct Presence Hours= (NST*TP)+OT-SL
= (8*10)+1-4 = 77 hrs
Delegated Hours = Sum(all delegation man-hours)
= 20 hrs
Worked Hours = D.Presence Hrs- Delegated Hrs
= 77-20 = 57 hrs
Paid Hours=(ST*TE)+OT-SL =(11*8.5)+1-4
= 90.5 hrs
Direct Efficiency=
𝑇ℎ𝑒𝑜𝑟𝑒𝑡𝑖𝑐𝑎𝑙 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑 𝐻𝑜𝑢𝑟𝑠
𝑊𝑜𝑟𝑘𝑒𝑑 𝐻𝑜𝑢𝑟𝑠
Productivity=
𝑇ℎ𝑒𝑜𝑟𝑒𝑡𝑖𝑐𝑎𝑙 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑 𝐻𝑜𝑢𝑟𝑠
𝑃𝑎𝑖𝑑 𝐻𝑜𝑢𝑟𝑠
87.7 %
55.2 %

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