How to Develop Key Performance Indicators

How do we develop key performance indicators (KPIs)? KPIs are associated with goals and objectives. What do you want to achieve, and by when? KPIs answer the quantifiable piece of your goals and objectives and are the heartbeat of your performance management process. They tell you if you are making progress.

Different types of key performance indicators:

➤ Cost of Quality
(Identify failures to prevent them)

➤ Defects KPI:
(Looking at defects in subassemblies)

➤ Customer Complaints and Returns
(Monitoring customer issues to prevent them)

➤ Scrap
(Calculate the unused materials)

➤ Yield
(Measure of process or plant effectiveness)

➤ Overall Equipment Effectiveness
(Measure of productivity and efficiency, availability)

➤ Throughput
(Is the quantity of goods produced over a given time period)

➤ Supplier Quality Metrics
(Suppliers not meeting merchandise specifications)

➤ Delivery Metrics
(Correct delivery)

➤ Internal Timing Efficiency Metrics
(Deadline to produce a product and release it)

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