Managing maintenance operations is one thing—but is there a single “right” way to measure them? With hundreds of maintenance metrics available for organizations to choose from, it can be difficult to know which ones to focus on to improve performance.
Fiix’s Solutions Engineering Leader recently stopped by the Rooted in Reliability podcast to get to the heart of what matters when it comes to maintenance metrics. Stuart and host James Kovacevic discuss the cycle of performance management, how metrics and KPIs work together, the difference between leading and lagging metrics, and why it’s important to foster enthusiasm for hitting targets at every level of an organization.
Listen to the podcast episode here (also available on Accendio Reliability’s website) or read the transcript below.
James Kovacevic: It is my pleasure to welcome Stuart Fergusson to the podcast. Welcome, Stuart.
Stuart Fergusson: Thanks, happy to be here.
JK: So Stuart, you are a Technical Solutions Engineer with Fiix Software. I know we’ve had a bunch of your counterparts on the show. You guys always bring some good value, so I figure, why not bring someone else on to talk about how the CMMS helps, and more specifically we’re going to talk about metrics today.
But before we dive into that, prior to joining Fiix, you were with Procter and Gamble working as production line manager and also working in plant controls and information systems, and you also have a degree in electrical and electronics engineering. What did I miss from that brief bio that you want to fill in?
SF: No, you pretty much hit the nail on the head there. Yeah, I had the unique opportunity of being on one of the larger P&G plants and working through the engineering department down into the operations and kind of the day-to-day grind. So I’ve got a pretty good idea of how they do business and how we handled maintenance and, you know, everything around that.
JK: Excellent, excellent. So we’re here to talk about using metrics to drive improvements, and that is also known as performance management. So, what is performance management in your own words?
SF: In my words, performance management’s a cycle. Whether you’re managing machines or people, it’s going to be an iterative process. So my view on it uses three main stages. You need to enable, you need to coach, and then the last and the most important is measure. So you want to keep that cycle going, enabling, coaching, and measuring your performance. And I think that’s the bulk we’re going to talk about today kind of sits in that third bucket of measure.
JK: Excellent. So with that measurement piece, what are metrics and KPIs?
SF: So metrics and KPIs, they’re—in the highest terms possible, they’re the target. Metrics are everywhere. Every business has their metrics, and most have a pretty good idea of what their metrics of choice are. I think where I’ve seen a lot of companies who work with us and companies I’ve been a part of go a little wrong are with KPIs. So the KPIs are a metric. Well, a metric is more a KPI, but it’s a number. It signifies the importance, really, of where that KPI is being set. So there’s got to be a reason for having a KPI. There has to be a target and you have to have a glide path to reach that target. So KPI is—if you’re going to measure your business in the KPIs, that’s great. But metrics are kind of the nuts and bolts that go into a good KPI.
JK: Yeah, I couldn’t agree more. I actually was teaching a class yesterday and no one knew a difference between a metric and a KPI. And to me, you have many metrics that lead up to a KPI, and that KPI is—you don’t have a lot of them. Those are the key things that your organization is going after.
SF: Exactly, and each group’s going to have their own metrics that are going to build to that KPI, but that KPI has to be, you know, held at a different level and held with a different amount of importance. And that’s really where you drive the value from a true KPI-based business decision.
JK: Absolutely. Now, there’s two types of KPIs or metrics, depending on how you look at it: Leading and lagging. What are they, and what’s the difference between them?
SF: So I’ll start with the lagging. A lagging is typically something you see as a KPI, and it’s looked at in hindsight to gauge how effective a plan was over a certain span of time. So I’ll use one that everybody understands, a breakdown, right. Counting a breakdown is a lagging metric, right? It’s something that’ll, you know, that’s always going to be there, but there’s nothing really you can do to impact that directly on a day-to-day, which is where you really get into your leading KPIs. So your leading KPIs is something you know that’s going to impact that lagging number. So for example, if you’re looking at schedule compliance, that’s great. You find and fix your defects, right? That’s all solid, you’re catching more breakdowns before they happen by tracking that PM compliance, right? And you’re finding and fixing defects. So you want to be on top of things on a day-to-day basis that are going to impact that lagging KPI. Right. And those are gonna be your leading metrics.
JK: Excellent. Now, how should we use these metrics and KPIs in a maintenance department?
SF: In a single word, actively. Within the maintenance team itself, so we’ll get right into the maintenance side of things, you have to be looking and staying on top of your leading metrics. So, actively coaching and actively measuring against those, right? And by doing that, you’re never going to let those lagging metrics get away from you. If you’re on top of your leading, you’re gonna have an idea of where your lagging’s going. So let’s use this example: If I’m putting a lagging metric in front of the guys, they’re really making a difference, a guy’s turning the wrenches, how are they going to impact that positively on a day-to-day basis? So that’s where the leading metrics really come in where, you know, it’s stuff that you can do on a shift basis. That you can have a positive impact and really drive that plan every single day. You worry about the inputs, the outputs could take care of themselves.
JK: Yeah, absolutely. Now, with hundreds of metrics available, if I think of the SMRP Best Practice Guide, there’s hundreds of them in there. How do we pick which ones we should be using in the maintenance department, or do we use them all?
SF: Well “all” might be maybe a bit of a stretch. At some level, somebody is gonna be looking at a lot of them. My opinion though on how to make that decision and pick those right metrics, you’ve got to think about that as a group. They need to be aligned through your organization, right, starting at the top. So if you decide, let’s use the example of OEE. A lot of people talk about OEE as a driving KPI. And if that’s where your plant’s going and that’s the end-all, be-all for your plant, you need to decide on those KPIs, or sorry, those metrics that are gonna affect that KPI as a maintenance team, communicated across, you know, operations and maintenance and you know, the plant leadership team, they all have to agree what metrics we are going to drive and how exactly those metrics are going to point at and directly influence that key KPI that you’re trying to change.
JK: Yeah absolutely. You know, I typically find anything more than 12 that one person is looking at, they start to get a little scattered, too. So you don’t want to go too broad, we want to keep it somewhat focused, but we do have to have many of those metrics all used at different levels, different people looking at them, so on so forth. But we don’t want all of them to be KPIs for the maintenance department.
SF: No, exactly. You’ve got to decide on those KPIs as kind of a plant leadership team, right, and you’re going to track a lot more than you want the guys doing the work to be tracking. You need to make their lives easier, and easier is not putting 15 things in front of them that they’ve got to keep an eye on. You know, you want two or three actionable endpoints. So you want to take that list of KPIs that are meaningful to you and you need to boil that down at each level and really drill down to what’s important to the specific person doing that work that day.
JK: Now once we establish these metrics or KPIs that we’re looking at, how important is data quality with these things?
SF: I mean, the data quality defines the healthier business plan. If your business plans align around KPIs, how clean that data is is really the health. So if you’re getting good, clean data in your system on all those metrics that you’ve decided to track and you’re not making any headway in the KPIs, that’s information. You have good data there, you’ve simply picked the wrong metrics, right? The metrics aren’t influencing it. So when you run into those situations, too often that’s not going to get caught and they’re going to get pencil-whipped or tweaked, those metrics, to positively impact your KPIs, which is just going to bury that real issue and it doesn’t allow your business to move forward. You’re not going to make a meaningful insight from any of that data if the data’s false.
And something else that, you know, that isn’t apparent in the day-to-day when you’re getting gauged on your metrics, but pencil-whipping and that stuff always comes out in lagging metrics. So if you now influence your breakdown in your schedule compliance numbers, right? Yeah, it’s going to make your OEE look better for the month. But when you go through that quarterly review and, you know, you’re looking at throughput and you’re costing for the maintenance team, you’re not going to be able to justify that raw data.
So that health is really important because you don’t want to be defining a plan based off lagging metrics, right. If you’re using leading metrics properly and keeping an eye on that, you’re going to have an idea of where your lagging metrics are going before you ever run them and have to talk about them in a review.
JK: Yeah, absolutely, and I think, you know, that data quality piece, I think there needs to be some governance around that. I’ve seen organizations where they will game some of the metrics, if you will. For example, you do a benchmark, everyone’s hitting about 60-70 percent scheduled compliance. So you tell everyone they’ve got to work on fixing it. Next thing you know, a week or two later, the sites that were really far behind all of a sudden hit that new metric. You dive and you take a look at it, well now they’re only scheduling 10 work orders that week as opposed to the 50 plus that they were scheduling the week before.
SF: Yeah. Hundred percent, couldn’t agree more.
JK: So what I find with this too is, you have a balancing metric that really helps prevent those inadvertent behaviours, right? And we have schedule compliance, we put in percentage planned time beside it so we can see how much time are they spending on planned work versus what their schedule compliance is, it balances it out. And I think that’s a critical thing we need to consider, is not only the data quality, but how these metrics or KPIs are driving behaviours.
SF: Yeah, exactly. And you’re bang-on with that KPI and metrics. You’re going to have many metrics that are going to impact that KPI and some of those are gonna be health check metrics. Those, let’s call them leading indicators for your KPIs that make sure those KPIs are in a healthy place. And that’s something you definitely need to keep an eye on especially at that, you know, that supervisor/manager level where, you know, you want to keep on top of that iteration of performance management, right? Tie it right back to that first bit. It’s that enabling and the coaching. And then you measure. And if that measurement’s a little off, right, you re-enable and you coach. And that’s where you’re really going to drive consistency and health in your metrics.
JK: Now with that, should we be using leading, lagging, or both?
SF: I have yet to come up against a situation where I wasn’t able to justify why you should be using both. Lagging metrics are setting those larger targets, and by identifying those larger targets, you can drill down to your leading metrics and manage towards those. And the same with those health check targets, those are lagging, but you need to keep on top of those lagging metrics as a health check. So there’s always going to be room for both.
And if you’re at a point where you have enough lagging metrics to review on a certain set basis, and you have leading metrics that you’re managing towards on a daily basis, you’ll be in a really good place to positively influence that lagging metric that you really care about. Or worst case, you’re going to know when those metrics are going to be trending in the wrong direction based off of your leading metrics.
JK: Yes absolutely. I always find you’ve got to use the combination of the two as well.
Should we have different KPIs at different levels of the organization or if the organization is focused on OEE, should that be everyone’s performance measure, I guess.
SF: I think the KPIs, there’s an argument for both here, but I believe that KPIs should be the same and different at all levels. You mentioned performance managed against, I think that’s where I would kind of draw the line. If OEE is what the plant cares about, everybody needs to care about OEE, no matter what level of the organization you’re at. But what you are coached on and managed against on a day-to-day basis has to be something a little more meaningful to what you’re doing, right? So as that operations team or as that maintenance team, what can you do on a day-to-day basis to make OEE increase? Or hold where it is, or whatever your target or your goal is.
So for example, you know, OEE might be the biggest influence that we’ve agreed the maintenance team can make on OEE is minimizing breakdowns. But how do you tell the maintenance team, “Hey guys, don’t have any breakdowns”. Fine, we’ll pencil-whip them, right? So you need to get to those metrics that are gonna make a difference. So yes we’re tracking OEE, yes we’re tracking breakdowns, but on a day-to-day basis I’m worried about schedule compliance and, you know, response time or defects fixed. So we can grab those breakdowns before they become an issue.
JK: Yes, absolutely. Like you said, you know, everyone might be focused or have the awareness of that OEE, but we’ve got to break it down to the individual levels. The technician on the floor in his day-to-day job isn’t going to influence OEE. He’ll be able to influence metrics that as they work together with other metrics, you know, influence that KPI as well as a planner, or maintenance plan or maintenance schedule. They will be having to do different things each day, each week that you drive OEE. But we need to make sure that they’re measured on those things that are relevant to them, that they can influence, that they can actually see the performance increase or decrease based on their own individual performance.
SF: Yes. Couldn’t agree more. And those metrics and those things that they’re tracking every day, we talk about all different levels of the organization. Those still start at the top. You define that target at the top and then it’s on those different management levels to define what the target is for each level and how that directly ties in and influences that end-all, be-all target for the organization. And as long as there’s a clear path to how the metrics that you’re gauged on is going to impact that metric the site is gauged on, you’re gonna have that very clear communication line and some transparency as to why you’re doing what you’re doing every day.
JK: Yeah unfortunately though, most organizations I find, they don’t do that. They don’t break it down to that level, they don’t decide what those targets are at the different levels and cascade it down. They go at the one KPI or two KPIs for everyone, and that’s it.
SF: And that’s great for the management side of things, and the problem you run into, and I’m sure a lot of your listeners will agree is, the problem rests with the guys turning the wrenches, right? They’re trying to influence a number that, they know what it means, but what does it really mean to them right there, you know, underneath that machine trying to replace that part.
JK: Yeah, exactly. Now, are there any other thoughts on metrics or KPIs that you want to share with our listeners?
SF: I mean, I think what I really can’t stress enough is that alignment through the organization. And you hit the nail on the head with the fact that a lot of organizations aren’t aligned that way. Everyone needs to understand that target, and they need to understand the metrics that they are influencing every day so that as a team, we hit that target. And turning that into a team goal instead of, you know, each group pointing at different, misaligned targets is really how you get meaningful change in an organization.
JK: Yeah, even when you speak of the misaligned targets, if your organization is focused on costs, we’ve got to be careful what we’re communicating, whereas procurement might be trying to find that bearing that’s cheaper by 50 cents, but by doing so, we’re jeopardizing reliability and it’s going to cause a lot of extra downtime. While we’re focused on cost, is that the right way to cut cost, or is it to reduce downtime, reduce overtime by getting the right parts in to begin with, right? So it’s that alignment again, but in a different sense.
SF: Yeah, exactly. And you can make a really good case for why you need, you know, that other bearing, because you have some good reliability data on that bearing and you know it’s going to last X amount longer. And because the organization’s aligned and listening to the reasons that we’re cutting costs and the reasons we’re making these decisions, then you’re going to have more productive conversations instead of, you know, maintenance being told we need to get rid of breakdowns, and procurement being told we need to, you know, buy everything at the lowest possible cost. That’s not helping either group. If you’re aligned on the overall goal and then what metrics you’re driving to get there, you’re going to have much more productive conversations.
JK: Absolutely. Now, how can a CMMS support an organization’s use of metrics?
SF: So three main ways I think I would see that working, and the first one is more what we just talked about, that data tracking. Having that reliability information. So a strong CMMS is going to be the system of record for all your maintenance data, right, and it’s going to be able to feed back those key metrics through, you know, a dashboard system and you’re gonna be able to keep on top of your KPIs and your lagging metrics through reporting and pulling data out of there in a meaningful way that you can make insights from.
The example of that bearing we just talked about, if you can pull data on those two different types of bearings and show, you know, average lifespan of each one and why it makes more sense to go with the more expensive one from a cost perspective, that conversation is a non-starter where we have the data and the facts in front of us and we can make informed decisions.
The second reason, CMMS plays kind of the role of system of engagement as well as system of record, right? Your system of engagement keeps all your maintenance activity organized, in line, everybody’s, you know, working to the same drumbeat and knows what their job is to the day.
And then the third way really that you’re supporting the metrics, and it’s not so much supporting the metrics as it’s a system of engagement for the whole organization. So understanding where to feed in maintenance-related requests and follow up, and even being able to pull data on the maintenance team, and where you’re at and where your machine is. So you’re ensuring that everything hits that maintenance work plan. Nothing’s falling through the cracks and everybody’s on top of where maintenance is at. Which, through that culture and that hundred percent engagement the organization is going to drive those metrics.
JK: Yes, absolutely. Now with that, keeping the CMMS in mind, trying that performance management system, all those things. What do you think makes the biggest difference in being successful in using metrics and KPIs to drive improvements within that organization?
SF: That third point on how CMMS supports, it’s that engagement of the whole organization. Its culture, which I know is thrown around a lot and it can be a little cliché, but if your culture and everybody in your plan understands the goals of the plant and of their own team and of the maintenance team, and you’re all actively working towards the same goals, you’re going to reach it a whole lot quicker than everybody trying to do their own thing separately. Those metrics need to be aligned and everybody has to be bought in.
JK: Yes. You know, that culture change, like you, said it’s cliché, but every single thing you try and do, you’ve got to worry about the culture, you’ve got to worry about trying to change people’s perceptions, beliefs, and help them through that change. If you don’t do it you’re going to struggle. You’re going to take twice, three times, four times longer than it should take to make that change and that adoption.
SF: Couldn’t agree more.
JK: Now, if you had a magic wand, what is the one thing you would change in a typical performance management program.
SF: The management process itself, I think. I think we look at it the wrong way a lot of the time, for how we’re managing the people on the floor. I think we need to be focused on making those folks’ jobs easier every single day. Whatever that looks like for you in your role, you’ve got to make that happen. So if the guy holding the wrench, I don’t think there’s any argument that he has the most direct impact on plant maintenance. He’s the one turning the wrench. So how can you enable that person to be more effective on their shift? What can you do today and tomorrow to make their lives easier?
JK: That’s very—couldn’t agree more. We make their lives easier, they provide the right data, they have time to provide the right data, they have time to do that precision maintenance or install a bell properly instead of rolling it over the sheets or pulleys. You know, we make their life easier, we drive reliability.
SF: And that open line of communication and that trust from getting that information firsthand and really being their champion is going to help get the right data, too. You used the example of putting belts on right, you know, maybe that’s a training issue. Maybe they genuinely don’t know, and then you can actively work on that and enable that person so that, you know, you nip that before it ever becomes an issue in the future.
JK: Yes absolutely. Now, what is the one thing you want our listeners to take away from the conversation on metrics, KPIs, and performance management?
SF: I think it’s the one thing that you and I both talked earlier that we see a lot of organizations not doing, and that is aligning. You need to be aligned through your entire organization. Make sure everyone’s aware of what metrics each team is driving towards and how those metrics are influencing your overall operations KPIs.
SF: If you can be aligned on that you will have success.
JK: You’ll be far ahead of many other organizations just by doing that simple thing.
SF: Yes you will.
JK: Well Stuart, where can people find out more about you, Fiix, and everything else you guys got going on?
SF: Yeah. As for myself, you know I’m on LinkedIn. Feel free to check me out there. I usually keep my feed populated with anything we’ll be at. Fiix itself, fiixsoftware.com, we have a great team with a ton of content out there that really, you know, helps you walk through some high-level stuff and provides some really cool resources for where to go next.
JK: Well I’ll make sure to put links to those in the show notes so people can easily get in touch with your LinkedIn profile and Fiix Software as well.
So, Stuart, one last question I always ask everyone involved in these conversations is, what is your go-to resource for metrics performance management KPIs, those sorts of things?
SF: Ooh, my go to. There’s a really good book out there, Maintenance and Reliability Best Practices by Ramesh Gulati. I have a feeling some other people from our organization might have thrown that one out there when they would have been asked this question. A great book just for a baseline on, you know, good maintenance, best practices. And other than that, the one thing I will say, there’s a ton of great web sites out there, great blogs and methodologies. And if you’re really interested in trying to stay on top of this stuff, look at all the methodologies. Too often I see people getting bogged down in one because you know they do it one way, right. Your organization’s going to be different than every other one in some way. So make sure you’re on top of what everybody’s doing and follow a few blogs, not just you know the ones you’re directly linked to.
JK: Absolutely. You know, sometimes I find by seeing the same methodology but explained by someone else, it makes that click for certain individuals that didn’t click the first time, right? So looking at all the methodologies and all those different perspectives definitely helps drive that performance.
SF: Yeah. And it’ll help you coach it too.
JK: Absolutely. Well, Stuart, I want to thank you for taking the time today to discuss with us metrics, KPIs, performance improvement, performance management. It’s a vital thing we do. We always are constantly trying to continuously improve our performance, deliver better performance from our assets, reduce our risk and so on so forth and KPIs and metrics are something critical to that process.
SF: I could not agree more. You’ve got to measure it if you want to make a difference.