Introduction:
Measurements communicate values and priorities to an organization. Time and resources devoted to measurement demonstrate management commitment that the object of the measurement is important. Therefore, the selection of appropriate metrics is an essential starting point for process improvement.
Lean six-sigma management:
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Time Metrics – How long it takes to produce a product/service? How much of that is processing time versus idle time |
Cost Metrics – How much does the process cost to operate (FTEs). Is there identifiable savings for the project |
Quality Metrics – How often does the process lead to mistakes that require rework. How do customers view the process? |
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1. Lead Time for process- total time (from start to finish from the customer’s perspective including waiting time) to develop the product/service. 2. Typically expressed in days 3. Best and worst completion time 4. Percent on-time delivery 5. Processing time- time to complete a process or process step, excluding wait time 6. Activity ratio – processing time divided by lead time, expressed as a percentage 7. Value added time 8. Non-value added time 9. Non-value added but necessary time 10. Percent value added time |
1. Labor savings 2. Cost savings 3. Cost per product- including labor, material, and overhead to produce the product/service |
1. Customer satisfaction 2. Rework 3. Percent complete and accurate percent of occurrences that work in process released to the next step does not require a downstream customer to make corrections or request information that should have been provided initially. 4. Rolling first pass yield – percent of 5. Occurrences that the product or document passes through the entire process without needing rework. |
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Output metrics 1. How many were produced each month/year 2. Production 3. Backlog – number of products/services that have not been started or entered into the process 4. Work in process – things currently being processed 5. Inventory- a supply of raw materials, finished products, and/or unfinished products in excess 6. of customer demand |
Process complexity 1. to be done during the event 2. Process steps 3. Value added process steps 4. Decisions 5. Handoffs 6. Loop backs 7. Black holes |
Organizational Metrics 1. Lean events conducted 2. Lean Event participation – number of employees 3. Lean training provided-number of employees attended.
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