Measuring performance is a fundamental principle of management. This activity is essential given the need to identify the differences between the achieved and desired performance, so that one can then obtain an indication of which actions should be prioritized in order to reduce this gap and achieve a higher level of excellence.
To assist in this measurement task there are Key Performance Indicators (KPIs), indicators that can show different performances, from downtime, equipment availability, maintenance costs, and many others.
In a succinct way, they serve to point out what is going well and what should be improved in the measured activity.
HOW TO CHOOSE EFFECTIVE INDICATORS FOR YOUR COMPANY
The number of KPIs that exist today is quite expressive, there are even software programs that provide hundreds of options.
However, the wrong choice of KPIs can generate little relevant results, causing loss of time and effort in their creation, collection, and analysis.
In addition, it is not uncommon to choose KPIs that are not very actionable, that is, indicators that present results that are not very manageable, that do not contribute to performance improvement, and may even result in the demotivation of the teams involved.
That said, it is essential to choose KPIs that are really useful and applicable to the situation, that provide relevant information, and that can indicate which direction of action should be prioritized in order to obtain better corporate results.
The key point for such a choice to be appropriate is the definition and the clear and deep knowledge about what the company’s goals are.
Their definition and understanding will strongly influence the choice of KPIs, since the objective of these indicators is precisely to help achieve the goals.
However, the establishment of goals is usually a complex task. The SMART method, developed by Peter Drucker, was developed to help in this process. This acronym is self-explanatory and consists in ensuring that the goals are:
Specific: specific, leaving no room for interpretation and misunderstanding.
Measurable: quantifiable, so that one can effectively compare and evaluate their performance. Preferably they should be expressed in numbers or percentages.
Attainable: achievable, they can and should be challenging, but should consider the company’s capacity and possibilities.
Relevant: relevant to the organization’s objectives.
Time-based: they must have a deadline, otherwise they can be forgotten or no longer be a priority.
Defining well-structured and clear goals makes it possible to create relevant and effective KPIs that will contribute to their achievement.
For example, if the goal is to reduce the downtime due to failure of a certain production line equipment, a relevant indicator could be the mean time to repair, that is, how long it takes, on average, for this equipment to be repaired and return to full operation, represented by the formula:
– MTTR = total downtime hours caused by failures/number of failures
This would be an example of a well-defined target and a relevant KPI to reach it.
EXAMPLES OF MAINTENANCE KPIS USEFUL FOR YOUR COMPANY
Maintenance KPI categories are diverse in nature, including equipment reliability, maintenance costs, operational risks, maintenance quality, and others.
Among these classifications there are some KPIs that deserve greater emphasis, given their wide use in industries around the world. They are:
– MTBF – Mean Time Between Failures:
MTBF = total time of good operation in a given period/number of failures.
This indicator has been previously discussed in this article
– MTTR – Mean Time To Repair:
MTTR = total downtime hours caused by failures/number of failures.
This indicator will return the average time of each equipment stop, as previously mentioned.
– Availability: corresponds to the probability of equipment being in condition to be operated at any time. This indicator is one of the most important, since high availability is the main objective of maintenance;
– Backlog: measures the accumulation of maintenance activities yet to be executed. How many man-hours or how many days will be required for their execution;
– Compliance with the maintenance schedule: indicates in percentage how many of the planned services were executed;
– RAV – Replacement Asset Value represents the cost of replacing the production capacity of a given set of assets or plant, including production equipment, facilities, support and related assets;
It serves as a basis for benchmarking, that is, to compare companies and sectors, regardless of the area of operation.
The benchmarking calculation involves maintenance costs, which can be of various natures, such as corrective, preventive, and predictive, divided by the RAV, thus returning the percentage of maintenance costs in relation to the total replacement value of the plant or set of assets.
If this value is high, it means that your facilities and equipment are very expensive to maintain, and this can be caused, among other reasons, by poor maintenance and operation practices.
– OEE – Overall Equipment Effectiveness is an indicator used to measure the operational effectiveness of a piece of equipment, a production line, or even a company.
The OEE calculation is done through three other indicators: quality, performance and availability, according to the following formula:
OEE = quality *performance *availability*
The quality indicator corresponds to the percentage of products manufactured without defects; the performance indicator corresponds to the ratio between the actual production speed and the expected operation speed and, finally, the availability indicator, already discussed in previous paragraphs.
For example, a company with 98% quality level, 92% in performance and 97% in availability, would obtain an OEE of approximately 87%, according to the formula below:
OEE = 0.98 * 0.92 * 0.97 = 0.87 or 87%.*
These are the most commonly used indicators in companies. However, as already mentioned, there are several others. It is up to you and your company to evaluate, based on the goals, which ones should be adopted.
HOW TECHNOLOGY CAN HELP YOUR COMPANY IN THE FOLLOW-UP OF KPIs
Technology, such as maintenance management software and machinery condition monitoring devices, comes to assist in the collection and management of KPI data, making the information more reliable and accessible, and providing historical data that can serve, for example, for comparison between performances in different periods.
With the Dynamox Solution you can, through Bluetooth connection, access data histories, record photos and activities in a very simple way, on the screen of your smartphone or tablet.