Operational performance

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What is operational performance?

Operational performance measures how well a company performs its core business activities. It's measured using key performance indicators (KPIs), usually quantifiable measures of a process, process step, or program.

How do you measure operational performance?

A maintenance team can measure operational performance through various key performance indicators (KPIs) and metrics that reflect their maintenance activities' efficiency, effectiveness, and overall success. Here are some standard maintenance metrics that are used to measure operational performance:

Equipment uptime: This metric measures the percentage of time that equipment is available and operational. It helps assess the team's ability to keep critical assets running and indicates their effectiveness in preventing and resolving downtime issues.
Mean time between failures (MTBF): MTBF calculates the average time between equipment failures. It helps gauge reliability and maintenance effectiveness by measuring how long equipment operates without experiencing failures.
Mean time to repair (MTTR): MTTR measures the average time required to restore equipment to full functionality after a breakdown. A lower MTTR indicates efficient maintenance processes and quick response to failures.
Overall equipment efficiency (OEE): OEE is a comprehensive metric that combines availability, performance, and quality to measure the overall effectiveness of equipment. It considers factors such as uptime, production speed, and product quality to provide insights into equipment performance and maintenance efficiency.
Planned vs. unplanned maintenance ratio: This ratio compares the time and effort spent on planned maintenance activities (routine inspections, preventive maintenance) versus unplanned maintenance (breakdowns, emergency repairs). A higher proportion of planned maintenance suggests effective maintenance planning and proactive measures.
Maintenance backlog: This metric measures the number of pending maintenance tasks or work orders. A high backlog may indicate a resource or planning issue, potentially leading to delays and decreased operational performance.

What are the main objectives of operational performance?

The main operational performance objectives can vary depending on the organization and industry. However, some common goals include:

Reducing costs: Controlling costs is a crucial objective for organizations. Operational performance seeks to identify opportunities for cost reduction, such as streamlining processes, eliminating inefficiencies, and optimizing resource allocation.
Improving quality: Maintaining and enhancing product or service quality is a fundamental objective. Operational performance aims to reduce defects, errors, and rework while ensuring consistent and reliable outputs that meet or exceed customer expectations.
Increasing employee satisfaction: Operational performance objectives also encompass the well-being and development of employees. This includes fostering a positive work environment, promoting employee engagement, and providing training and development opportunities to enhance skills and knowledge.
Increasing productivity and efficiency in your organization: This leads to increased profitability for the business. It involves maximizing output while utilizing the available resources efficiently. Organizations can achieve higher production levels by improving productivity and delivering more value to customers.

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How do you increase your operational performance?

To increase operational performance, there are five key steps you can follow:

Set clear objectives: Clearly define the desired outcomes and objectives you want to achieve concerning operational performance. These objectives should be specific, measurable, achievable, relevant, and time-bound (SMART). For example, if your objectives include improving production efficiency by 15% within six months or reducing customer complaint resolution time by 20% within three months.
Analyze current processes: Conduct a thorough analysis of your current operational processes. Identify bottlenecks, inefficiencies, and areas for improvement. This analysis can involve gathering data, conducting process mapping, using tools like value stream mapping, and involving relevant stakeholders. Understanding the existing processes and their shortcomings will help you target specific areas for enhancement.
Implement continuous improvement practices: Embrace a culture of continuous improvement within your organization. Encourage employees at all levels to identify and propose process improvements. Implement lean maintenance, six sigma, or kaizen methodologies to systematically identify waste, reduce variation, and streamline operations. Foster an environment that promotes experimentation, learning, and innovation.
Invest in technology and automation: Leverage technology and automation tools to optimize operational performance. Identify areas where technology can automate repetitive tasks, improve accuracy, and enhance efficiency. This can include implementing enterprise resource planning (ERP) systems, robotic process automation (RPA), machine learning algorithms, or advanced data analytics. Technology can help streamline processes, increase productivity, and provide valuable insights for decision-making.
Develop and train your workforce: Invest in developing the skills and capabilities of your workforce. Provide training programs, workshops, and resources to enhance their knowledge and expertise. Ensure that employees understand the importance of operational performance and empower them to contribute to improvement initiatives. Foster cross-functional collaboration and create platforms for knowledge sharing and idea generation.

Operational performance is an essential part of business

Operational performance is an integral part of any business. It helps you understand how well your operations are running and allows you to adjust as needed. You can improve your operational efficiency to align with your business goals with the right tools and strategies.