Sunday, January 22, 2012

10 Points to Ponder That Can Improve Your Key Performance Indicators Immediately

Here are 10 Points to Ponder That Can Improve Your Key Performance Indicators (KPI) Immediately:
1.    Spend time planning for KPI implementation
Decide who needs to know about the metric or indicator and what they need to know. Who is affected and who can affect the KPI. Communicate the intent of the metric in a way that can be easily understood.
2.    Think about unintentional consequences
Understand what your metric drives. Does it require a second metric to ensure that it does not drive a bad behavior? If you would like to read more about this topic check out this rant.
3.    Limit your focus to ten indicators or metrics or less at each level of the organization.
Even if you track many indicators in your EAM/CMMS the focus needs to be on a short list. It is OK to have a list of focus KPIs and monitor KPIs. Focus on your key performance indicators and ensure organizational understanding. Monitor your results with the common indicators. Here is a link to more information on this topic.
4.    Manage behaviors measure results.
You must identify the behaviors that you want to change and address them directly with that portion of the organization. Ensure that your indicators align directly to those organizational changes.
5.    Cascade indicators down from corporate goals.
If your primary indicators do not align and support the corporate objective then you will have organizational confusion. The process works best if indicators are developed from the top down. 
6.    Leading verses lagging indicators
You don't drive your car using just your rear view mirror. Use indicators that tell you more than just what you have done. They should help you understand what you can expect in the future.
7.    Use your metrics to ensure the truth.
Many of the indicators have corresponding indicators that work in a checks and balance fashion. This allows you to use one indicator and then if there is a question about the validity of the number you can check with the other indicators.
8.    Have metrics that both operations and maintenance share accountability for.
Consider not building or reinforce organizational silos. Try to select indicators that both operations and maintenance and others affect and share them as part of their performance reviews.
9.    Understand the components that make up the metric.
Many organizational struggles are over both metrics definitions and the data that is used to calculate them. Create or use an existing KPI standard and document the data sources.You can find the SMRP Metric Compendium here.
10.    KPI’s are not forever
Change the metrics you focus on as your business goals change or as you notice that the change in behavior that you are measuring has been completed and has become the new way the organizations works. Here is another entry on this topic.

Two Bonus Thoughts:
Balanced score cards can help in understanding your organization.
Do not compare what is not the same. Indicators cannot be bench marked well with other facilities if they are not calculated the same way.

I hope that this list helps you think about the metrics and indicators that you are using and drives the results that your facilities want. If you have any additional questions please feel free to contact me at

Monday, January 16, 2012

What I Learned From a Rolling Mill in Indiana

What I Learned Series Post 2

This is series of post will cover basic concepts and "ah ha" moments that I have had over the years in the various companies that I have consulted. Some of the content will be common places in your facility and some of it may be new but I share it all with the intent to provoke thought and demonstrate how many things are the same no matter what the end product of the facility.  If you would like to know more about any of the topics please feel free to contact me.
  1. Situational leadership is imperative. People's needs change as they move through the change process. The way the leaders of the organization interact must be different as they enter the different phases. See this post for more information. At this site, the focus teams that were dedicated to the project focus areas were moving through the change process very well. They had passed the "valley of despair" and were moving up into the development phase. About that time the client project leader was promoted and an individual who had not been involved was put in place. At this point I did not understand this concept of situational leadership.This lack of understanding lead to unnecessary friction. Had I understood the needs of the new person were different than the focus teams who had been working for months then I could have avoided the pain and moved the project along faster.
  2. Competing initiatives kill if not managed. If you do not manage competing initiatives effectively it can lead to a slow death of the projects. Take the time to create a master plan that looks at not only your project but also any other projects that might occur during the same time frame. This is best done with the leadership team with input from any corporate improvement groups. You need to consider all of the plant projects, their resource requirements, and how they fit with other projects. When you go through this exercise you find that some things must be done in a certain order and that some can be done in parallel. You will also identify where synergies between projects will lead to progress in both at the same time.
  3. Operating context is important keep your cookie cutters in the kitchen.This site saw firsthand that they needed to take the time to look at each asset individually based on criticality. This allowed them to use information from previously done FMEA and maintenance plans but not without verifying that the equipment was used in the same way with similar environment. See this post for more information on the importance of understanding operating context.
This client was one of my first major project and for that reason also one of the most educational of my consulting career. This is but a sampling of the learnings but I hope they allow you more success in less time.

Tuesday, January 10, 2012

What I learned from a paper mill in Canada

What I learned series post 1

This is series of post will cover basic concepts and "ah ha" moments that I have had over the years in the various companies that I have consulted. Some of the content will be common places in your facility and some of it may be new but I share it all with the intent to provoke thought and demonstrate how many things are the same no matter what the end product of the facility.  If you would like to know more about any of the topics please feel free to contact me.
Paper Mill
  1. Unions can drive change initiatives as much or more than leadership. They can be an excuse for why change is stalled, or they can be the reason for success with a change initiative. It is up to the leadership and the relationship they foster. This facility had five unions and four supported the change and the fifth did not fight it. The key to this support was open transparent communication, involvement, and a clear understanding of what was at stake for all parties in the end.
  2. Communication planning is crucial but execution is everything.This is one of the best examples of the change initiative being planned and the details socialized that I have ever seen. The project leaders brought everyone in the plant together to hear the message and learn of both the concepts being implemented and the tools that would be used to ensure success. They also spoke of the risk and what they had planned to mitigate them. It was a great process to be a part of.
  3. Burning platforms burn. Focus on these driver for change and use them to make progress but remember they are nearly single use so the same motivator can not be the burning platform that you continuously use for every change initiative.  This was a facility that knew their fate if an improvement was not made. They could see that they had to make a change or their high production cost would price them out of the market. They used it effectively and were successful in creating a fundamental change in performance.
  4. It is hard to see the changes you are making when you are in the middle of them. Especially in the planning phase. As you start to move through the change journey you will not always be able to see the progress that you are making in terms of bottom line performance gain. Use a master plan to show the items that have been successfully completed and celebrate the little steps until the journey you have made becomes apparent.  
There were many other learnings from this site and it was one of my favorite sites because of their desire to change and the hard work they put into making it happen. 

Tuesday, January 3, 2012

Operating context is important... So keep your cookie cutters in the kitchen

As we all think about focusing on our New Year Resolutions and leave the cookies behind remember to also "keep your cookie cutters in the kitchen"

In the battle to "leverage" everything we do to the maximum and ensure full return on effort and investment many sites copy preventive maintenance task across all "like" assets. This copying process is continued with failure modes effects analysis, and root cause analysis findings too. The problem comes in when determining what the definition of "like" is.

Some folks say "a pump is a pump is a pump..." I would suggest: Not exactly. The issue centers around operating context. Let me give you a real example, let's say your plant had a new fork lift in the warehouse that was used to manage raw materials which you serviced using the manufactures suggested PM. Then let's say your business needs changed and now due to storage constraints you had to move some of the raw materials storage outside. Outside of your warehouse is a dirty world where leaked raw materials blow in the wind covering everything with a coat of fine hard particles. If you were to continue with the original preventive maintenance program on the same schedule that was developed for the relatively clean warehouse then you will suffer the effects of operating context. The air filters will clog with debris before their change interval is reached and then they will collapse in. When they collapse then the hard little particles begin to destroy the engine from the inside out. Now you find yourself changing the engine more often than the oil and your cost are through the roof.

The point is that if you change the operating context then you have to change the maintenance strategy. The strategy that works for one asset in one area will not always work in another. The strategy has to match the new failure modes from the new environment. The same thought has to go into leveraging FMEAs or PMs or RCAs across other parts of the plant. If the situation or applications is different, if it is dirtier or hotter or more caustic, then you have to consider that when applying the previously developed information. Don't get me wrong you can use leveraged information it just has to be done wisely. If you start with the cookie cutters then for the sake of the asset take the time to ensure it meets the needs dictated by the operating context and does not create more reliability problems than it solves.