Measuring Maintenance KPIs

Basic maintenance KPI metrics

As the adage goes, you can’t improve a process without first measuring its performance, but what are the most important maintenance KPI metrics you should measure? Establishing a baseline for success should be the first step whenever you set out to improve something. Bill Gates draws the example of the steam engine  – one of the biggest advancements in the industrial age, as being a product of incremental design changes and precise feedback, as opposed to one Eureka! – type moment. “Without measurement,” writes William Rosen, invention is “doomed to be rare and erratic.”With the steam engine, the criteria is fairly straightforward. A superior design would have some combination of being lighter, more powerful, more fuel efficient, cheaper to construct, etc.

The same is true for maintenance metrics and there is a wealth of performance indicators that can be used to measure and improve performance. For example,

Performance Indicators Chart

Minimizing downtime might seem like a worthy goal, but not if it also has a negative impact of product quality or employee morale. Or, if it jeopardizes a longer term strategy of increasing the proportion of preventive/reactive maintenance. When optimizing the department there are dozens of confounding factors to be considered. The struggle then becomes which maintenance metrics to focus on.

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Introducing the balanced scorecard approach

The balanced scorecard approached was first introduced in the early 1990’s and encouraged managers to track performance using a variety of metrics. The central idea is to avoid optimizing one area at the expense of another. Increasing machine availability by stocking an excessive number of spare parts – OEE improves, but inventory costs skyrocket as well. The age-old practice of measuring performance based solely on financial indicators alone has been found to be inadequate and missing the whole picture. Hence, a new school of thought has emerged that reconciles high-level financial measures with more practical day-to-day key performance indicators (KPIs).

Balanced scorecards provide a clear and effective approach to capturing a high-level view of the organization.

Critical Success Factor Chart

*Cost/unit should be defined based on the specifics of your organization. Generally speaking, it will include some combination of labour, spare parts, overtime, contract labour, utilities, insurance, etc.

**OEE: Overall equipment effectiveness = (Availability)*(Performance)*(Quality)

This holistic approach to maintenance brings the organization one step closer to integrating maintenance with other high-level goals and promotes the idea that maintenance metrics should be viewed as an input to production instead of a necessary waste.

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