The 5 Most Important Lean Manufacturing Metrics To Achieve Operational Success

Lean manufacturing strives to boost customer value by improving efficiencies and reducing waste across operations. Moving toward lean manufacturing requires more effective management of materials, human resources, and energy. Compiling and analyzing the right data is crucial to the success of lean manufacturing.

One of the most common problems that companies face when shifting to lean manufacturing is tracking the wrong key performance indicators (KPIs). Most companies focus on traditional accounting principles, such as standard labor costs or machine drivers, which only inform traditional—rather than lean—results. To achieve operational success through smart lean manufacturing decisions, companies must review lean-focused KPIs.

The Five Most Important Manufacturing Performance Metrics For Smart Manufacturing Success

  1. Total Cost, by Period

Comparing the current period’s total manufacturing spend against the last period’s total spend reveals whether you are reducing costs and achieving better output as time progresses. Understanding total cost trends inform resource allocation decisions that can improve output and reduce spending.

  1. Total Cycle Time (TCT)

Total cycle time calculates how long it takes to perform one repetition of any particular task or production of one part. Commonly referred to as “Start to Start,” this calculation can help minimize downtime and maximize productivity.

Examining TCT is a critical step in measuring manufacturing performance and matching supply with demand, a necessity for avoiding inventory shortfalls or excess.

  1. Delivery Performance

Delivery performance examines the difference between when a customer requests a product and the original schedule date and does not factor in shipping promises. This data reveals your operation’s ability to meet customer requirements.

Knowing whether production schedules are consistently meeting customer expectations is vital to meeting demand and shifting planning and scheduling to achieve lean manufacturing goals.

  1. Quality

Lean manufacturing focuses on quality from the perspective of the customer. Lean manufacturing stresses customer value and targets continuous improvement—from reducing product defects and rework of parts or components, to lower costs for end consumers. Examining the frequency and nature of customer returns or warranty claims is a good step toward improving quality and customer value.

  1. Safety

Keeping employees safe is vital to increasing production and lowering costs. Systematically incorporating safety measures into production and shop floor processes is an integral part of lean manufacturing. From ensuring floor spaces are clutter free, to integrating safety inspections into daily activities and audits, to eliminating extra inventory to maximize space, incorporating safety measures into lean processes helps to save time, money and resources.

When examining or incorporating any of the metrics above, it is essential that one step not degrade the performance of the other. When transitioning to lean manufacturing, the goal is to aggregate data, shift processes, and make changes that seamlessly function to serve increased efficiency, productivity, reduced waste, and lower costs.

FREEDOM™ smart manufacturing production management software is a suite of data reporting platforms that provide real-time metrics from any industrial asset on the plant floor. Providing 24/7 access to utilization, availability, performance, quality, and OEE reports. The software helps to dramatically increase manufacturing efficiency—serving any of your lean manufacturing goals.