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Wednesday, April 24, 2013

Best Practice Metrics Performance Requires Best Practices...

Over the years I have worked with many sites all over the world specifically to help them with assessments of their "As is" state. These were in preparation for their reliability, safety, and operations improvement initiative that will help them attain their "to be" state and the performance gain that is associated with that improvement.
The assessment process has many different variations depending on the site and the topic but all of them should have three things in common. The three are:
  • a metrics or key performance indicator review
  • practices and documentation review
  • interaction with as many of the affected and involved individuals as possible to understand application, culture, and norms 
If you are lucky then all three will tell a similar story and you can begin to plot a course to the "to be" state and the value of that progression. This does not always happen. Sometimes two will agree but one does not support the others. It is a bit like looking down at the dash of the car and seeing that your oil pressure is low and you are idling at 500 RPMs but your speedometers says you are traveling at 145 MPH. This indicated disconnect is concerning. Let me give you two industry examples. In the first example, let us say you are assessing a facility and you find well documented business processes but mediocre metrics performance and when you go to the plant floor and speak with the crafts, operators, and the supervisors you realize they don't know anything about the processes or the metrics. Or another possibility, maybe you find that the metrics show great performance but there are no or very limited business process and from the discussions with the site personnel you discover the site culture does not support the current level of metric performance or suggested reliability. This is where the improvement process can bog down. In the first example you would need to investigate to truly understand, but it appears on the surface that the business processes may have come from somewhere else and were never embraced or lost support for what ever reason. In the second example, the metrics may have been "optimized" over time which can cause them to get to a point where the math that is used to make them look so good is beyond science. I worked in one facility many years ago that regularly ran with an overall equipment effectiveness or OEE of 115. They ran a 115 with mediocre practices so there was still room for improvement. If they got it all right, there was potential to see 125 on a 100 scale metric but alas it did not happen as far as I know. Maybe they decided to change the math.
My point is that if the three areas of focus do not match you may want to use some root cause analysis tools to find the underlying causes. Once these are found then you can explain the disconnect between the three areas. The second step is to help the site see the mismatch in metrics, practices, application and culture. I like to use our maturity matrices which you can get here to help with this element. The site has to understand that world class performance on metrics has to be supported by world class performance in business process, culture, and application. Once they are comfortable with this then they can begin to embrace the true "as is" and discover the true potential that they can capture in the gap.
Have you experience the mis-match?

2 comments:

  1. According to my experiences in two different plants, KPI metrics and values should be initiated by the hands on supervisors and artisans or operators. It shouldn't be a top down concept. And the management KPI should reflect the completion of all those KPIs. If you find some mismatches between strategic objectives and operationals', you need to realign them as top down approach. In general it's not necessary, excpt if the communication is not a regular practice.

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  2. Francisco mejiaMay 3, 2013 at 1:46 PM

    The second example can be an example of the lack of communication from the top down. Who is supposed to set the expectations? Who is supposed to required the people doing generating the metrics of how they should be calculated?

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