Manufacturing KPI is a web-based monitoring and reporting software that provides real time data to your organization. The manufacturing kpi software allows you to effectively manage both overall performance and key performance indicators related to safety, profitability, cost reduction and yield improvement in a single platform.
Kpi software for manufacturing companies and what is kpi in manufacturing and how to use regression analysis for kpi calculation.
MANUFACTURING KEY PERFORMANCE INDICATORS AND METRICS
✔ SEE DIFFERENT TEMPLATES & DESIGNS ✔ FIND & TRACK THE RIGHT MANUFACTURING KPIS TO MEET YOUR CORPORATE OBJECTIVES
A manufacturing KPI or metric is a well-defined measurement to monitor, analyze and optimize production processes regarding their quantity, quality as well as different cost aspects. They give manufacturers valuable business insights to meet their organizational goals.
PRODUCTION VOLUME
Evaluate your production volume over time
Our first manufacturing KPI example will give you an overview of what your factories are able to produce in a month, a semester or a year. You then have the big picture of what your business is handling and when. Comparing it to previous similar periods with the help of a dashboard is a good indicator of evolution, to stop anomalies, regress or progress. Likewise, measuring which machine makes up for which percentage of the production can give you an idea of their performance and importance – no one wants to see a 45%-production machine breaking down without a plan B. Acknowledging that will also help in assessing your assets and what you invest in them (cf. return on asset).Performance Indicators
A good production volume is one that satisfies demand but does not leave too much inventory in stocks.Relevant Showcase Dashboard
PRODUCTION DOWNTIME
Optimize your maintenance regularly
One of the most important manufacturing metrics to track is production downtime. If your machines are not working, the result is money that can’t be made: reducing your downtimes to a minimum must be your goal number one to avoid further lost profit. When downtime happens, it is necessary to report the reasons why it occurred, as it is the only way you can track the problems, assess them, and then acknowledge what needs to be solved. Downtime can also be planned, when the equipment needs maintenance, or during lunch breaks and shifts: that way, you can not only optimize it, but also keep it under control by preventing machines out of service, or inventories running out of stocks taking you by surprise.Performance Indicators
Try to reduce your downtime as much as you can. Monitoring will help you improve processes, boost profitability, and evaluate the effectiveness of your equipment.Relevant Showcase Dashboard
PRODUCTION COSTS
Monitor the costs implied in the production
The production cost by product specifies how much each component of your product costs and how much it represents for your finished product. Breaking down this manufacturing metric into the various types of costs will tell you which ones are making the biggest part of your unit and can help you if you want to track different expenses that can be optimized. Tracking these production costs over time is a good thing to know how they evolve and if you manage, at the end of the day, to stay under the target price per unit you set in order to make it profitable.Performance Indicators
Measure the overall costs per unit your business has over a production cycle, and see if that makes you profitable in regard to the sales price you want to set.Relevant Showcase Dashboard
Manufacturing KPI Software & Metrics Dashboard
Measure what matters.
Your manufacturing, distribution or supply chain business is healthiest when everyone focuses on the same thing: the critical few key performance indicators (KPIs) that are essential to meeting daily, monthly, weekly, and annual goals and advancing your digital manufacturing objectives. Dploy Solutions KPI Management software keeps the entire team focused on manufacturing metrics that directly lead to increased margin and revenue. Everyone is accountable for achieving KPI targets and is equipped with problem solving capabilities for quickly changing misses into hits.
Work together, not against, each other.
When businesses have too many goals, those goals compete with each other, or employees don’t know where to focus, it’s hard to make progress toward anything. This is especially true as manufacturers look to advance their digital transformation journeys.
High-level views into the business via dashboards
Focus on meaningful KPI metrics you can act on now.
Dploy Solutions KPI dashboard software brings clarity and alignment to your daily, weekly, monthly, and annual business performance goals. The solution empowers everyone in your organization to:
- See real-time performance data related to the critical KPIs across divisions, regions, or locations.
- Know at a glance which production KPI metrics are on track, and which aren’t.
- Safeguard against critical misses with customizable alerts that notify the right people and escalate up the chain of command as needed—senior leaders become involved only when issues can’t be resolved at a lower level.
- Drill down into root causes behind performance problems.
- Create action plans to remove roadblocks.
- Put countermeasures in place to permanently resolve problems.
- Track implementation and impact of improvement actions.
- Identify performance trends over time and further analyze problems and successes.
Problem Solving Capabilities
Alerts and Escalations
Win the year, one day at a time.
With Dploy Solutions KPI Management software, you improve daily execution from the factory floor to the executive floor. And the progress you make is in the areas that matter most to your longer-term success. People at all levels are empowered to understand what’s critical to the business, actively manage issues, problem-solve in real time, and identify new opportunities to improve and grow your manufacturing business in the digital manufacturing era.
Drill down capabilities
Why Your Company Should Be Using Manufacturing Specific KPIs to Stay Competitive
The manufacturing industry represents more than 10 percent of the US economy, and more than 15 percent of the global GDP. The only way to stay ahead in this fiercely competitive industry is through the implementation of manufacturing KPIs and metrics.
Everyone strives to increase the top line of a business, trying to gain more market share in an attempt to increase profits. While this is important, what if you could grow your bottom line without having to take on expansion risks? This is where KPIs for the manufacturing industry come into play.
The Fundamental Manufacturing KPIs and Metrics That You Should Be Using in 2021
When your company is just starting to implement KPIs, the whole concept can seem fairly daunting. Rest assured, it isn’t as bad as you think. Everything can be broken down into smaller, more digestible morsels of information. In this section, we will go over 10 of the basic examples of KPIs in manufacturing that your company should consider using:
- Throughput – This is probably one of the most fundamental KPIs for the manufacturing industry while also arguably one of the most important. The Throughput KPI measures the production capabilities of a machine, line, or plant; also known as how much they can produce over a specified time period.Throughput = # of Units Produced / Time (hour or day)
- Cycle Time – The cycle time KPI is very simple in nature, but that doesn’t mean it can’t be manipulated to be a very powerful tool. In the manufacturing industry, cycle time is the average amount of time it takes to produce a product. Simple, right? Maybe not as simple as you think. The cycle time metric can be used to measure the time it takes to manufacture a completed product, each individual component of the final product, or even go as far as to include delivery to the end user. Thus, cycle time can be used to analyse overall efficiency of a manufacturing process on the macro scale, as well as determine inefficiencies on a micro scale.Cycle time = Process End Time – Process Start Time
- Demand Forecasting – This manufacturing metric is used by companies to estimate the amount of raw materials they will require to meet future customer demand. This metric can be a little bit trickier for companies to fully utilize, as it is highly dependent on uncontrollable external factors. The basic formula is as follows:Projected Customer Demand = Raw Materials * Production Rate
- Inventory Turns – This is a measure of how many times inventory is sold over a specific time period and helps indicate resource effectiveness. Low ratio numbers indicate poor sales and excessive inventory, while high ratio numbers represent strong sales or insufficient inventory.Inventory Turns = Cost of Goods Sold / Avg. Inventory
- Production Attainment – This production performance metric measures production levels over a specific time period and calculates what percentage of the time a target production level is achieved.Production Attainment = # of Periods Production Target Met / Total Time Periods
- Cash to Cash Cycle Time – This is a time-based manufacturing KPI metric. It measures the amount of time it takes from an initial cash outlay for raw materials, inventory, or a manufacturing plant until the company receives cash from its customers for its products. This KPI is typically measured in days.Cash to Cash Cycle Time = Inventory Sale Date – Inventory Purchase Date
- Avoided Cost – This doesn’t mean you can just avoid paying bills and keep all the profits. The avoided cost manufacturing metric is an estimate of how much money you saved by spending money. Seems strange, right? The most common example is how much money is spent on machine maintenance vs. repair cost if a machine were to break down, plus the lost production value associated with the repair downtime.Avoided Cost = Assumed Repair Cost + Production Losses – Preventative Maintenance Cost
- Changeover Time – At the most basic level, changeover time represents the amount of time required to switch from one task to another. Typically, in manufacturing, it represents the amount of time lost from switching a production line from one product to another. However, it can also represent the amount of time lost during a shift change.Changeover Time = Net Available Time – Production Time
- Takt Time – This is a very useful manufacturing KPI when scheduling production orders or deciding whether to take an order from a client. Takt time is the maximum permissible amount of time that can be spent manufacturing a product while still meeting a client’s deadline. For those who are curious, Takt stands for “taktzeit,” a German word meaning “cycle time.” While very similar in nature, this is not to be confused with the cycle time KPI.Takt Time = Net Available Time / Customer’s Daily Demand
- Return on Assets (ROA) – You might be thinking, this seems like it has less to do with manufacturing and more to do with finance. That is because it does. However, financial metrics are just as important as manufacturing metrics. You can’t have a business if you aren’t making money. This metric evaluates how well your business is making use of its assets (money). It is the annual net income divided by total assets (fixed assets + working capital).ROA = Net Income / Avg. Total Assets
It is key to note that these are just the basic KPIs used in the manufacturing industry. A company should look beyond these for more insight into their production practices.
Conclusion
Manufacturing KPI software is a collection of reports, dashboards, and documents that allow you to effectively deploy and control performance objectives throughout your organization. These documents will help you and/ or your manager understand how you are performing with respect to safety, material usage, quality, and efficiency. This is an especially important feature in today’s competitive environment.