NIST Study on KPIs Offers Manufacturers an Opportunity to Contribute

The National Institute of Standards and Technology (NIST) is conducting research into how manufacturers use Key Performance Indicators (KPIs) to improve manufacturing productivity.  The study is being conducted by Dr. Brian Weiss and a press release detailing the study follows:

“Does your organization define and monitor Key Performance Indicators (KPIs), either in your own business or that of your customers? If you do, then you know how challenging it is to choose the “best” set of KPIs – among the 1000’s available –to improve the performance of each business segment and satisfy corporate-level requirements. Apart from trial and error methods, do you know how to quantify the effectiveness of a KPI (or a set of KPIs)? The National Institute of Standards and Technology would like your input on this very topic.

NIST has assembled a KPI Effectiveness project team that is seeking to quantify the effectiveness of KPIs in order to enable automated optimal manufacturing to the benefit of the manufacturing industry. Our plan is to generate measurement techniques that quantify the effectiveness of KPIs to best position manufacturers to select the optimal KPIs for satisfying management performance requirements. Initially, we need to understand the barriers to quantifying KPI effectiveness.  Since we are not manufacturers ourselves, you are vital to the success of our project. Even though KPIs are primary tools for optimizing factory operations, manufacturers do not fully benefit from KPIs and we have heard from manufacturers like you that knowing the relative effectiveness of KPIs will further enable optimal manufacturing. We believe that it is critical for the NIST team to understand the current state-of-the-art of your facility with respect to KPIs, including those KPIs you employ, their effectiveness, and how you determine their effectiveness. 

To that end, NIST personnel are facilitating discussions, teleconferences and/or site visits with manufacturers implementing KPIs in their factory environments. These fact-finding discussions are being used to identify the measurement science barriers related to KPI selection, implementation and effectiveness where any and all company-specific information will be anonymously labeled outside of NIST. You are a key stakeholder in this effort so understanding your successes, challenges, and areas of concern is vital.

The NIST team’s main questions to understanding your usage of KPIs include:

What KPIs do you currently use in your plant/operations?

Where do you use these KPIs?

Why do you believe these KPIs are best for your requirements (corporate/business targets)?

What is lacking in the optimal use of these KPIs in your plant?

Who is responsible for those KPIs, including choosing them, monitoring them, responding to them, fixing problems indicated by them, and feeding results back to management about KPI effectiveness?

What is the perceived effectiveness of the KPIs you use, and how do you define and measure effectiveness?

How is the response to KPI changes known or defined?

To get your voice heard please contact Dr. Brian A. Weiss (brian.weiss@nist.gov) for more information.”

This is a real opportunity for manufacturers to contribute to improving manufacturing productivity and further reinforces the points I made in earlier posts that the federal government seems to have a renewed focus on improving US manufacturing productivity.


Dan Miklovic is blogger contributor for Control's blog Manufacturing 2010. You can email him at danmiklovic@gmail.com or check out his Google+ profile.

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