Front-line leadership and performance indicators

So, what do I mean by “results”? First of all, let me clarify a common mistake. Organizations often mix up actions with results. Actions are the things we do to produce results. But if these actions do not generate results worth more than the cost of these actions, we can call the whole effort a waste of money and time.

Five years ago, I visited a plant that had formed improvement teams to re-engineer the maintenance function. Eight people worked full time with two outside facilitators to draw maps of existing maintenance processes and then proposed improvements. They found that planning, scheduling and preventive maintenance could be improved, a fact that was identified in several days. This effort took a total of no less than 16 weeks for eight people (5,120 hours), plus the cost for two outside facilitators.

I recently met with members of the original improvement team. They reported that (after five years!) some improvements had started in one plant area, but most plant areas had done nothing. This example is not an exception. It is very common, and I can give many more examples of wasted efforts than of true success stories. I always wonder how management can get away with such wasted initiatives. On the other hand, it helps me understand that most organizations don’t show much enthusiasm for new improvement efforts. They have seen too many wasted efforts coming and going.

In order to change this disbelief, top management down to middle management must demonstrate long-term dedication for the improvement effort. Good advice: Do not call the effort a program because there is no end to the improvement effort, and there is nothing revolutionary about it. Most actions are to improve existing daily work.

Successful organizations decide what they need to do, then they execute it. This is the only difference between the best performers and the rest.

Front-line performance indicators

Again, do not mix up actions and results. Results include improved competitiveness (tons/cost), productivity (tons/hours worked) and overall production efficiency (tons made/tons that could have been made, etc.).

Actions include better alignment, balancing, lubrication, planning, scheduling, etc. The outcome of all these actions can be measured, and the indicators used should be as closely related to the action as possible. Action indicators should be used to drive continuous improvement and necessary change of behaviors to deliver expected results.

Front-line performance indicators include:

• Break-in work within weekly and daily schedules. To use this indicator, you must have weekly and daily schedules. You also need a clear definition of break-in work; for example, work added to daily schedules less than 19 hours before start of the working day or shift. Best performers have less than 10 percent break-in work, often achieving only 5 percent break-in work within daily schedules.
• Combined trends of overtime, contractor usage and backlog hours;
• Average vibration level trend.
• Average life of select components.

If you don’t measure selected front-line performance indicators, you won’t know if you truly improve. If you measure them and see improvements, then you can also expect results indicators to improve.