My "bible" for KPI's and PI's is
Developing Performance Indicators for Managing Maintenance from Terry Wireman

No, I have no shares involved, it is just my favourite KPI book

Normally KPI's are brewed in the "upper clouds" by Ac count ants

I work for a Drywall Manufacturing plant and we started working with MP2 in 2003, in the begining we has quite a few K.P.I's we reviewed once a month with the Engineering Dept one was Schedual compliance, Equipment Failures which covered any piece of equipment with more than one emergency work order charged to it, Urgents by area, Work mix such as the percent of PPM, Repair, Modify, Replace and Renew type of Work Orders. Here is a sample

0606.pdf (46 KB, 109 downloads) KPI.pdf

Ninive, you have done some very interesting work to make you efforts visible, I like that, but that is only the reporting part. With KPI's you need something to compare against (a goal, a target) thus you have something to "improve".

Like the "accountants" have something like:
ACME company will produce 5000 widgets/month

If you are under, you are below target, if you are above, everybody will be looking good

Let's get to the heart of KPIs. KPIs should be identified as Leading and Lagging. They should be used to manage 'best practices. Best Practices (along with benchmarks) should be defined for each element of a company's maintenance and reliability process and KPIs are used to measure the gap for each element. ReliabilityWeb will post a survey on KPIs soon and I am curious how the results turn out.

Attached are a few KPIs used by a company who is one of the world's leader in reliability. Theses KPIs are identified as Leading and Lagging on the attachment. You can find more KPIs at www.smrp.org and go to the Best Practices Committee link.

KPIexample.doc (54 KB, 142 downloads) KPI Examples

We have 2 sets of KPIs
Maintenance KPIs are about doing the job in a sensible timescale (backlog, overdues etc)
Reliability KPIs are
- measure of lost tonnes due to equipment failure
- measure of cost of maintenance by equipment (i.e. what costs you a lot to fix)
- MTBF for key equipment (pumps, motors, valves, meters, analysers)
- % reactive work
- repeat failures
- PM compliance (which is additional to compliance with regulatory routine work).

I intend to change these measures as our process for improvement moves on, but this is where I'm starting.

Helen.
Note - most of these are lagging!!

hello,

I went searching for this thread as I knew that this topic had been discussed earlier.

However like companies mentioned in articles I read, I fail to distinguish between a leading and lagging KPI. They both measure performance....

Can someone please briefly explain clearly the difference between. Thank you.

Rennie,

Go to: http://www.plantservices.com/articles/2006/208.html and read this article on KPIs. I promise after you read this article you will understand leading and lagging KPIs. Email me if you have any questions.

Some food for thought....

Someone once describe KPI's to me like finishing highschool.

Your vision: to enter University.
Your goals: are to have grades in classes high enough to get you into university.
Your KPIs: Grades (Lagging) or Time Spent Studying (Leading)
Your actions: determine the grades you need to get into university, determine how each course is graded, determine what material needs to be understood for each course, study this material (Some sort of Strategy). Where grades are weak increase your efforts (Some form of Continuous Improvement).

Reliability and Maintenance:
Your Vision: to perform reliability and maintenance functions that allow the business to achieve its objectives (as per corporate, general manager, other?)
Your Goals: are to ensure equipment maintenance actions are optimized (perhaps this means balancing the consequence of failures versus the cost of maintenance)
Your KPIs: Literally Hundreds (dependent on how your business measures success)
Your actions: Where you need to be strong (impact leading indicators), where there is weakness (impacting lagging indicators).

Jaz, that's a good analogy and yes Ricky I read the article and got the feel of it.

One question....if leading KPIs are the ones which can affect the process for improvement, then why monitor also lagging KPIs, does'nt improvement in these come naturally then, (if I can express myself correctly)?

Other question please. It's mentioned that there are organisations who monitor too many KPIs and we know the recommendation, start with a few and improve accordingly. Any suggestions for KPIs for a brand new plant?

Thank you.

Rennie,

I am glad you read my KPI Article and hope it helped. I wanted to answer your two questions:
Questions 1: Lagging KPIs are important because they are the result of your maintenance and reliability process. Lagging KPIs such as MTBF, Maintenance Cost, Asset Availability are important because these are things upper management cares about.
Question 2: For a new plant (I love new plants) I would identify your maintenance and reliability, map the each function in the process, identify leading KPIs as you map the process, identify lagging KPIs which, and assign responsibilties to each KPI. I have a few slides which may help however they are too large for this forum. Send me an email at ricky.smith@ivara.com and I will forward you these slides.
A little advice, identify your maintenance process as "Asset Reliability Process" in order to have everyone focusing on Reliability.
Take care and stay in touch.

Dear All,

Please excuse me if you find this out of order. But I would like to plug my own book on this thread as it relates to the theme at hand directly.

The Maintenance Scorecard is a book on the creation, maintenance, and implementation of a balanced set of measures that apply directly to the asset management and maintenance disciplines.

I wrote this book because on several occasions I have tried to implement a balanced scorecard into maintenance operations and have always found it to be too narrow for our requirements. I have also found that the standard texts talk little about how to generate the data required for producing all of these metrics, and how to implement performance programs generally.

Also I found that most commentators believed that metrics for asset management were generic and could be applied in any circumstances. I think this showed a lack of understanding of how complex our discipline is depending on the operating environment.

The MSC looks in detail at the various elements of performance measurement, including

• the RCM scorecard (A measure of the effectiveness of RCM implementations)
  
  
• Myths and misunderstandings about performance management programs
  
  
• An overview of how asset management is NOT a one-size fits all managerial discipline. Along with the question of how companies can use asset maintenance as a strategic initiative, not just a tactical neccesity
  
  
• A guide to leading and lagging indicators and examples of each
  
  
• Throughout the book it is focussed on how to produce the measures, how to link them together to form a direct link btween what managers see and what the work force does, and a guide to how to implement comprehensive performance management programs.
  
  
• And of course a catalogue of indicators focussing on the strangths and limitations of each, how to produce them, whether this requires complex functionality or not, and some views on performance measurement rather than just metrics.
  
  For example, issues such as time-based measurement are important and more can be gleaned from trending them than from one-shot figures. THis is the case with performance measures such as age-versus-priority for work orders, or time usage of equipment.
  

I hope this is of some interest to you all. And I hope that nobody finds this posting out of line. (If so please send me an email on darylm@strategic-advantages.com)

Also, some recently published articles of mine on the issue of performance management.

• Leading and lagging indicators (Rennie)
  
  
  
• A guide to producing KPI's
  

I hope this is of some use to you all.

Best regards,

Dear All,

As this theme is focussed on the production and use of metrics generally, I would like to share some quick points with you from my experiences if thats okay.

In particular I would like to warn agqainst the common errors that people enter into when they are creating a measurement program.

When a maintenance department begins to focus on performance indicators it generally does so in an uncontrolled and unfocussed manner. This normally occurs in one of the following ways, regardless of whether the department has some indicators in place or not.

• Imposed Metrics- A request for regular information from higher management
  
  
• Legacy Metrics- A new manager putting in place familiar manage-ment tools. This also occurs with suggestions from employees or oth-ers wanting to put in place familiar management tools.
  
  
• Influenced Metrics- Suggestions from employees based on an article or indicator they have heard of
  
  
• Ad-Hoc Metrics- Employees using database or spreadsheet skills to create indicators in an uncontrolled and unfocussed manner

In all cases the approach is one that delivers a list of indicators. However it is based on a purely reactive focus and in a way that incorporates a number of inefficiencies into the process of measuring maintenance. These areas of ineffi-ciency can be grouped as follows-

• Inefficiency in measurement
  
  
• Indicators used in a reactive, as opposed to a proactive, manner
  
  
• Inefficiency in implementation

As alluded to by others here, if you want your performance program to be effective, drive the correct behaviors, and to link the corporate waffle with the day to day work of maintenance, then you need to approach the matter of indicators in a different manner.

One that identifies the levels of performance your company requires, defines the gap between the corporate objectives and the current reality, puts in place the initiatives to close the gap, and develops the (often) unique indicators to monitor this.

Whether you are interested in doing this quickly as part of a measurement program on a specific asset, or whether you are wanting to transform the way a company does business, I have had a lot of success with the MSC approach.

Best regards,

Daryl,

Good to hear from you again.

I agree with you 100%. Maintenance managers need to understand KPIs (Key Performance Indicators)and be able to identify them as leading (lead to results) and lagging (results of actions). The problem I see with many managers is the need to begin with a defined maintenance process (I like to call it an Asset Reliability Process). From the maintenance process they need to map each function (such as planning) in the process along with defining KPIs and leading indicators as these maps are developed. I know this seems like so much work and it is however the other option of not knowing where we have problems in the maintenance process. Managing assets by managing the maintenance process rather than reacting to failures is so key. I know mapping the maintenance process is difficult but I recommend a maintenance manager begins with the scheduling function first. Scheduling will show the fastest results.

I attached a process map for one function in maintenance with two KPIs identified on the process map.

Have a great day Daryl (where are you buddy?).

Ricky

MappingKPIs.pdf (300 KB, 82 downloads) Mapping KPIs

Hi Ricky,

I am in London at present. I live in the UK these days. (Four years now!!)

We need to catch up I would suggest, I will send you through an email over the next day or so.

WRT your posting, I agree with most of it, if not all of it. One thing that I would add though is that I am not sure that the reliability process is the same for all companies that need to manage physical assets.

I really don't believe that asset management is a one size fits all discipline.

I will b in touch. Best regards,

Daryl,

Sounds great.

When I make the statement "Asset Reliability" process what I am trying to do is to convince people their focus should be more on reliability than just the term maintenance because the end result of what we do in maintenance is reliability. Sometimes it is the words used that makes changes peoples focus. I agree no one maintenance or reliability process fits all and that is why an organization must develop one that meets the goals of their company.

Take care buddy and have a great day,


Ricky

geeeee! this is a great thread!

Rennie,

I agree fully! I just tried to rate the thread as a five and rated it as a one by accident! Sorry about that!

Interesting what you are writing. Is it possible that you also can send the slides to

johantim@scarlet.be

quote:

Originally posted by Ricky Smith, CMRP:
Rennie,

I am glad you read my KPI Article and hope it helped. I wanted to answer your two questions:
Questions 1: Lagging KPIs are important because they are the result of your maintenance and reliability process. Lagging KPIs such as MTBF, Maintenance Cost, Asset Availability are important because these are things upper management cares about.
Question 2: For a new plant (I love new plants) I would identify your maintenance and reliability, map the each function in the process, identify leading KPIs as you map the process, identify lagging KPIs which, and assign responsibilties to each KPI. I have a few slides which may help however they are too large for this forum. Send me an email at ricky.smith@ivara.com and I will forward you these slides.
A little advice, identify your maintenance process as "Asset Reliability Process" in order to have everyone focusing on Reliability.
Take care and stay in touch.