KPI are tools used to control an activity. These data therefore measurable facts determined by calculations that identify qualitatively or quantitatively, an evolution in relation to strategic objectives.
By this definition, we can learn :
- Measurement – Calculation
- Strategic objectives
- Steering
Measurement – Calculation : Any KPI must be based on concrete data. Such data must be translated in terms of ratios, quotients, percentages.
Strategic objectives : To make decisions, you must have goals. Each KPI of each service, must have a purpose in relation to the strategic objectives of management.
Steering : Steering is planning instead to improvise and therefore suffer. That’s monitor developments and be on the lookout for the slightest alert.
The establishment of KPI should be based on these three principles :
- It is impossible to improve without control and without objectives
- It is impossible to control without measuring
- It is impossible to measure without concrete facts
KPI can be classified into 2 categories :
- Results KPI : They are measured periodically (weekly, monthly, yearly) and give the results of your activities. They help to understand the past but are not very effective in improving.
- Operational KPI : Those that provide a progressive monitor. They indicate performance gaps.
For example, if I takes up the theme of mountaineering (see my article LEAN and Mountaineering) :
- An altimeter, can give you the height difference you have made since the start of the race. It is a results KPI.
- A heart rate monitor gives you instant your heart rate and lets you know if you have resources to continue and accelerate if necessary. It is an operational KPI.
- Similarly, an altimeter associated with a stopwatch can give you the time remaining before reaching the summit. You can then fill you in relation to your goals. The combination of both data and computing allows you to have an operational KPI.
The KPI are used to meet all of these objectives :
- Diagnostis
- Information
- Evaluation
- Communication
- Continuous progress
- Motivation
A set of KPI allows us to create a dashboard. This should allow the manager to control its process. But careful not to drown a dashboard with a multitude of KPI. Up to 5 must be sufficient.
To be effective, an indicator must be :
- Combined with an objective
- Train a decision
- Never be silent
- Being single
- Belonging to that or those who use it
FGC has developed an Excel utility to conveniently perform these indicators. Download this utility.
Similarly, if you want to control accurately and efficiently your various workshops and factories, you can use our business tracking system ACTIVOS. You will then have the ability to track and manage effectively time machines, time workforces and production time. A set of KPI will be accessible, and in real time on all of your units.
For more information about KPI.