SuREBPMS

Sustainable and resource efficient

business performance measurement systems
– The handbook

1
 Contents
Introduction 4
Measures, Indicators and KPIs 6
The purpose of BPMS 8
Manufacturing strategy 10
Management systems 12
Sustainability 14
The KPI life cycle 16
Design - The BPMS Framework 18
Design - Defining KPIs 20
Design - Basic Elements 22
Sustainable and resource efficient Design - Recommended KPIs 24
business performance measurement systems Design - Setting targets 28
– The handbook Implementation 30
Copyright © 2017 The authors Use - Measure 32
Use - Compile and Analyze 34
Use - Report and Make decisions 36
Authors:
Peter Almström Revise 38
Carin Andersson KPIs in early development phases 40
Anna Ericson Öberg References and further reading 42
Peter Hammersberg Publications from the SuRE BPMS project 43
Martin Kurdve
Authors 44
Anna Landström
Sasha Shahbazi
Magnus Wiktorsson
Christina Windmark
Mats Winroth BOXES
Mats Zackrisson There are THREE TYPES OF colored boxes in the handbook. See below what they represent.

Layout and graphics: Jonas Sandwall

PITFALLS SOLUTIONS INFORMATION
Illustrations: Josefine Ejnermark
Print: Billes Tryckeri, Mölndal, Sweden

ISBN 978-91-639-5272-2
 Introduction
Virtually every company has implemented some kind • How to manage and support a dynamic be- This handbook primarily targets production We would like to express our sincere gratitude to
of Business Performance Measurement System haviour and continuous update of the perfor- managers, XPS champions, and middle managers the industrial project partners Alfa Laval in Lund,
(BPMS), with the purpose of monitoring production mance measures in the BPMS? in large and medium sized companies within the GKN Aerospace Engine Systems in Trollhättan,
and business performance and executing business • How to integrate the perspective of sustainability manufacturing industry. However, both SMEs as Haldex in Landskrona, Volvo Cars Engine Plant in
and corporate strategy at all levels in a company. A on shop floor level in a company? well as any private or public organization could Skövde, Volvo Construction Equipment in Arvika
majority of these BPMS emanates from a multi- benefit from understanding and applying the prin- and Braås, Volvo GTT and GTO, ÅF, and Sandvik
dimensional scorecard integrating operational devel- Based on these challenges, the research project ciples presented, even though specific examples Mining and Construction for their great contri-
opment principles, such as Lean production and can Sustainable and Resource Efficient Business are from another context. bution during the project and for all the inspiring
be defined as: Performance Measurement system (SuRE BPMS) discussions concerning challenges, pitfalls, and
was initiated. This handbook will summarize The outline of this handbook takes it starting point remedies. During the project, a series of case
“A business performance measurement system refers some of the discussions and results from this in the motivation to measure performance and the studies has been performed together with the
to the use of a multi-dimensional set of performance project. The name of the project indicates the importance to link the design and target setting partner companies and we especially appreciate
measures for the planning and management of a two-fold scope: to the manufacturing strategy. The KPI lifecycle the support from Torgny Almgren, Pernilla Amprazis,
business” [1] is used to describe the design, implementation, Stefan Braunias, Nico Dima, Per Gabrielsson, Henrik
• Development of BPMS allocating minimum use, and revision phases of a BPMS, where the Kloo, Conny Larsson, Andreas Myrelid, Veikko
Recently, focus has also been put on Sustainable amount of resources to design and to use following symbols represent different parts of the Turunen and Johan Valett during these case studies.
Production, adding more frameworks and indicators while maximizing the understanding of what handbook:
for companies to administrate. The ongoing trend is should be done to improve the operational This project has been funded through the Strate-
that the number of measures constantly increases, but activities. gic Innovation Program Produktion2030, a joint
the question is if this trend increases the effectiveness • Development of BPMS integrating the per- Purpose of measuring effort by VINNOVA, Formas, and the Swedish
or if it supports the systematic strategic development spective of sustainability on shop floor level Energy Agency. Their support is gratefully ac-
of a business. The trend of increasing complexity in in a company. Strategic implications knowledged.
both BPMS and the production system, together with
the need of flexibility in meeting new challenges and We hope that this handbook will provide some new Overview of the KPI lifecycle
demands, raises a number of challenges: insights on how to design, implement, use, and Carin Andersson,
revise your Business Performance Measurement The Design phase Project Manager
• How should a BPMS be designed to allocate min- System (BPMS) towards better decision making,
imum amount of resources required for collecting directing operational improvement efforts to where The Implementation phase
data, analysing, and reporting information? it’s needed the most, while allocating less resources
• How to use the BPMS to understand opportuni- to manage it. We also hope to guide you on how The Use phase
ties, to trigger activities, and to develop decision to find indicators suitable for driving sustainability
support for improvements? improvements from a bottom-up perspective. The Revision phase

4 5
 Measures, Indicators OVERALL EQUIPMENT
EFFECTIVENESS (OEE)

and KPIs
A measure is the direct result of a measurement based on a few basic elements. These provide
activity that is performed to acquire data or infor- more information about the status of the process- AVAILABILITY EFFECTIVENESS QUALITY RATIO
mation, while an indicator is often compiled using es, also providing a wider range of improvement
two or more measures, thus being more aggregated opportunities.
and useful for predicting or estimating and be-
haviors. For example, each data point in a control Basic KPIs can be integrated or aggregated into
diagram is a measure, while the trend of the curve comprehensive KPIs, by e.g. a mathematical for- ACTUAL
PRODUCTION
PLANNED PLANNED
RUNTIME
ACTUAL
PRODUCTION
PRODUCED PRODUCED GOOD REWORK
BUSY TIME QUANTITY QUANTITY QUANTITY QUANTITY
in the diagram is an indicator. mula. KPIs are almost always associated with goals TIME PER ITEM TIME

used for reporting, benchmarking, or improvement

In practice in industry, these terms are mixed and all triggers. If using a comprehensive KPI to drive im-
measures and indicators used for decision making provement work, an understanding of the elements
or reporting are called performance indicators or and basic KPIs building up the comprehensive KPI An example of how a comprehensive KPI (OEE) is built up by basic KPIs and
key performance indicators (KPIs). It is unrealis- is necessary. COMPREHENSIVE KPI elements based on ISO 22400.The KPIs can be structured in a hierarchy where
tic that all these indicators are “key” but KPI has measures and other elements, such as planned busy time, are used to calculate
become a commonly accepted term. The term Everyone does agree on that KPIs are vital to BASIC KPI basic KPIs and basic KPIs are used to calculate comprehensive KPIs.
measure will be used to denominate the result of provide the information needed to explain and
a measuring activity and a measure can therefore communicate a company’s progress towards the ELEMENT
become a KPI or be aggregated or mathematically stated goals. What is sometimes forgotten is that
transformed to a KPI. a support infrastructure is needed to operate the
BPMS. Measurement equipment is needed, as well
According to the ISO standard 22400 [2] the base as databases for storing the information, analytical
for building a KPI are elements, being the lowest tools to transform data to information, and meeting
level in the hierarchical structure building up a procedures for taking actions. This infrastructure
comprehensive or high level KPI. The elements can be manual or digital using different IT-systems.
can correspond to measures e.g. by calculations More information about this is found in the Use
or identification of conditions or they can be set by section of this handbook. ISO 22400 “Automation systems and integration – Key performance indicators for
requirements. Elements or measure, being different manufacturing operations management”
time elements in the illustrated example to the right, Sustainability is an important theme for this hand- The ISO standard 22400 defines 35 KPIs, primarily for use in automated production in the manu-
can individually be subjects of improvements on a book and all aspects of environmental, social and facturing industry. An important contribution of the standard is that a large number of elements are
very local and basic level in a production system. economic sustainability are considered. These defined. These elements are typically different time or amount elements. There is a great need in
dimensions of sustainability are interconnected and industry to standardize these terms, because there is usually no consensus within each company
Basic KPIs, being e.g. equipment availability or in our studies, 90% of existing KPIs were found to about definitions of elements like lead times, cycle times and scrap amounts. If these definitions are
quality in the right hand example, is an indicator have a relation to sustainability. not standardized, it is hard to gain acceptance for the BPMS.

6 7
 The purpose of BPMS
IMPROVE

There are three major purposes of KPIs: Report, CONTROL

Control and Improve. Some KPIs may be use- Production control occur at all levels and with
ful for all these purposes, while others are only different time scale. From the measure of a
for one purpose. These purposes exist on all specific quality parameter in a machine that is
different hierarchical levels in the company and used to adjust the process, to monthly follow-up
for all different functions. However, the following of delivery performance at factory level to control
description is focused on the production and the that the delivery requirements are met. A control
KEY
production support functions. activity is performed to secure that a measure is PERFORMANCE
within the acceptable interval, and is therefore
REPORT always connected to control limits, upper and/or INDICATOR
There are several purposes of reporting such as: lower limits, defining an acceptable interval.

• Mandatory reporting based on legislation. IMPROVE

• Other public reporting such as Annual reports Improvements can be of different magnitude: From
or CSR (corporate social responsibility) small, continuous improvements to large invest- REPORT CONTROL
reports. ment projects. KPIs provide an understanding that
• Benchmarking, for example between improvements have been achieved.
factories in the same company group. There might be a need for new, specific KPIs to
• Internal reporting. make sure that the improvements reach the strate-
gic objectives. For example: The strategic objective
Internal reporting is represented by measures is to be flexible. Flexibility, in this case, is measured
that are passed on to the level above and not indirectly through a KPI for the service level to the
necessarily used for direct control, e.g. Energy customers. To become more flexible, it is deter-
consumption and Number of accidents. mined that the set-up time must become shorter.
A new KPI to measure the set-up time must be SILO MENTALITY
Accidents are obviously handled on the level defined to be used in the improvement project, but There are several pitfalls linked to the manufacturing strategy process. One is to not define
where they have occurred, but the measure of the before and after the improvement project there is no suitable attributes to the performance objectives, leading to different interpretations among
number of accidents is only reported upwards. need to measure the set-up time itself. people at the company on what is meant by each objective. This will also lead to differences
in interpreting the KPIs linked to these attributes.

8 9
 Manufacturing strategy
PERFORMANCE KPI UNIT
OBJECTIVE

Manufacturing strategy is the way we, at operation- back as reclaims instead? Another example, related DELIVERABILITY ON TIME %
al level, decide to meet the targets set at corporate to flexibility, may be product flexibility measured in
LEAD TIME h
and business levels. Manufacturing strategy links terms of number of products or variants, product
the corporate and market objectives to the pro- mix flexibility measured as the ability to run differ- FLEXIBILITY
duction resources, so that decisions being made ent products in the same production cell or line, or
are in congruence with targets and that targets are volume flexibility showing the ability to increase or
being set that are based on what is possible to decrease the production volume.
achieve. Strategic improvements need to be within COST
reasonable reach considering present capabilities The figure to the right shows an example of how to
and investments. It is important to create a two-way do the matching between performance objectives
communication between goals and capabilities and decision categories. The performance objective QUALITY
when developing the manufacturing strategy. deliverability is often considered very important,
but in this case two KPIs are needed, on time
The task is to have an ongoing matching or rec- delivery and lead time. These KPIs are measured

PROCESS TECHNOLOGY

PRODUCTION PLANNING
QUALITY MANAGEMENT
onciliation between the performance, regarding and described with their measured units, % and

VERTICAL INTEGRATION

DECISION CATEGORIES
manufacturing objectives, and the operational hours respectively. When looking at the decision

HUMAN RESOURCES
capabilities. Finding the right BPMS to do this is categories, we can see that all decision categories
naturally central. Every performance objective may may affect the deliverability. Taking on time delivery

ORGANIZATION
have several KPIs, which need to be measured in and vertical integration as example, the question is

& CONTROL

& CONTROL
order to track the performance. What do we mean “How important is good supplier control for achiev-

FACILITIES

CAPACITY
by quality? Do we find quality problems during ing on time delivery?” This has to be investigated
production and measure it as rework or scrap? Or and suitable actions can be made to improve the
do we send products to customers getting feed- performance up to the desired target.

DECISION CATEGORIES

NON-DEFINED ATTRIBUTES
There are several pitfalls linked to the manufacturing strategy process. One is to not define
suitable attributes to the performance objectives, leading to different interpretations within Each performance objective and attribute is more or less dependent on all decision categories.
the company on what is meant by each objective. This will also lead to differences in Example: How important is good supplier control (dealt with in the vertical integration) for
interpreting the KPIs linked to these attributes. achieving on time delivery?

10 11
 VISION &
Management systems STRATEGY

The use and improvement of the BPMS are is responsible for setting targets and define the
closely connected to the management systems measurements for efficient control of their unit. To
QUALITY ENVIRONMENTAL OPERATIONAL XX
for e.g. environmental, quality, and occupation- communicate progress to and receive feedback MANAGEMENT MANAGEMENT DEVELOPMENT MANAGEMENT
al health and safety management, as well as to from management the teams and units also need SYSTEM SYSTEM PROGRAM SYSTEM
operational development (OD) programs (e.g. to report KPIs upwards in the organisation to
continuous improvement initiatives). If the differ- higher levels where aggregated or specific targets
ent certified management systems are integrated needs to be known.
with each other and with OD-programs, it is rec-
ommended that the organization for the man- However, often are management systems and PRINCIPLES PRINCIPLES PRINCIPLES PRINCIPLES
agement system also take care of the operation, OD-programs not fully integrated and contain dif- & RULES & RULES & RULES & RULES
maintenance and development of the BPMS. ferent sets of KPIs. Although policies and visions
may be aligned, the connections to the strategic
To engage the whole organization, top manage- business process may be inefficient. The use of
ment should delegate selected responsibilities of different tools for similar purposes such as differ-
the BPMS control to the appropriate operational ent ways to do risk analysis for safety, quality and
level. Motivation to participate in data acquisition economy is common, as well as different ways to TOOLS & TOOLS & TOOLS & TOOLS &
METHODS METHODS METHODS METHODS
and improvement work is promoted if each team map production processes.

Success factors for In addition, to succeed with alignment of

operational development are: BPMS in the operational systems:
COMMON DATA
• Management involvement • Focus on the improvement cycle AND ONE
• Training and education (Plan-Do-Check-Act) INTEGRATED BPMS
• Employee empowerment • Connect BPMS development to production
• Alignment to long term strategy development
• Take ownership of measurement standards
• Ensure integration with the operational The vision and strategy must be the common base for all principles and management system
development methods and tools rules. The methods and tools needs to be in line with these and the KPIs need to be appropri-
• Make use of internal auditing ate for the tools and methods as well as give correct feedback for strategic decisions.

12 13
 Sustainability

Sustainability is a growing concern for manu- can, if defined properly, be used to monitor and
facturing industry and is usually explained as improve environmental sustainability, leading to
a three-dimensional concept as illustrated to lower levels of energy and resource use.
the right. A sustainable corporation aim for low
environmental impact, care about people working To move towards more Sustainable and Resource
at or being influenced by the company, and still Efficient BPMS, the following steps are recom-
remain competitive. The basis for sustainable mended:
manufacturing operation is to create high values
while using less resources. In that perspective is • The BPMS enables sustainable manufac-
resource efficiency a virtue of every manufactur- turing by including KPIs covering a broad
ing operation. Wasted resources do not add cus- scorecard with the sustainability dimensions
tomer value and represent costs to the enterprise of economic, social and environmental per-
and society in general. However, the challenge is spectives.
to link sustainability improvements on the oper- • The BPMS enables sustainability by including
ational level to financial results and sustainability KPIs supporting proactive decisions instead
improvement on corporate level. An increased of reactive reporting.
sustainability awareness is promoted by integrat- • The BPMS enables sustainability by widen-
ing more sustainability KPIs on lower company ing the perspectives including development
levels, and communicating these upwards in the processes and aligning the BPMS to manu-
organisation. facturing strategy and objectives.
• The BPMS is sustainable in terms of resil-
As shown on the right-hand side, sustainability ience to change where a dynamic behaviour
KPIs are not only environmental KPIs such as and continuous update of the KPIs in the
measures of emissions or energy consumption. BPMS are enabled and encouraged.
The manufacturing company can take conscious • The BPMS is resource efficient as cost
steps towards a more economic, social and efficient efforts are spent on collecting data,
environmental sustainability by defining KPIs that analyzing and reporting different information
drive behaviour and improvements in all three and decision making. There are many KPIs that influence two or even three of the sustainability dimensions.
dimensions. Many of the commonly used pro- • The BPMS is resource efficient by encourag-
duction KPIs focusing efficiency and productivity ing use of standards and best practice.

14 15
 MANUFACTURING STRATEGY

The KPI life cycle CHANGED KEY OBJECTIVE AND GOALS

STRATEGY

There are many elements that go through distinct The Use phase is the central BPMS phase with
life cycles, e.g. equipment that is developed, the purpose of monitoring and transferring infor- CHALLENGES DESIGN
produced, used, returned, disassembled and pro- mation within the organization to prioritize and
duced and used again. Also KPIs have a lifecycle initiate actions to meet the goals and purposes of
of design, implement, use and revise as illustrat- the manufacturing strategy.
ed to the right.
Within the use phase, Measuring is about es- REVISE IMPLEMENT
The Manufacturing strategy is the starting point tablishing the right objectives and assign own-
of the KPI life cycle. A BPMS should commu- ership to the measures, as well as ensuring data
nicate and deploy the strategy by appropriate availability and quality. Compile and analyze is
measures leading the organisation towards the the prerequisite for establishing information and
strategic purposes and goals. Before developing an understanding of how to act to improve. Using USE
any individual KPIs, the manufacturing strategy variation as a tool, analyzing trends and under-
needs to be in place and commonly understood. standing root causes are important elements. USE
Establishing a scheme for Reporting information INPUT
The first step in the BPMS life cycle, is to under- to the right stakeholders and the right time will
stand what should be measured and how. A well support decision making. A good visualization
designed set of KPIs should provide the informa- of a measure will provide information about
tion you need to make better decisions, answer- improvement opportunities and how to prioritize
ing e.g.: between actions. MEASURE

• Are we doing the right things? The manufacturing strategy should never be
• Are the things done in the right way? static, and the new knowledge the KPIs provide
DIGITAL
about the operation should initiate a Revision MAKE OR
COMPILE AND
Implementing the selected KPIs is a delicate task of both the goal levels and the set of KPIs. For DECISIONS MANUAL ANALYZE DATA
and will have less success if you do not get the example, if excessive amount of downtime is
whole organization on board. Finding the triggers caused by equipment setup, a new temporary
and work procedures for engaging and motivat- KPI measuring setup time is required, together
ing the organization is the path to success. with goals for this KPI and actions to increase REPORT
the setup efficiency. This KPI should be removed
when the target has been reached.

The KPI life cycle.

16 17
 Design
- The BPMS Framework
1 INTERNAL
CUSTOMER 2 INFORMATION
NEEDED 3 KPI
PRESENTATION 4 KPI
DEFINITION 5 DATA AND
ANALYSIS

The initial phase of the BPMS lifecycle deals with FINANCIAL AND NON-FINANCIAL KPIS
the design: what should be measured and how A classic set of perspectives in a BPMS is given in

i
should it be measured? The BPMS design con- the Balanced Scorecard, including Financial (cash
cerns four levels: flow, sales growth, operating income, return on equity
etc), Customer (% sales from new products, on time
• BPMS architecture and key perspectives. delivery, customers’ ranking etc), Internal business
• More specific set of KPIs in each perspective. processes (cycle time, unit cost, yield, product
• Individual KPI definition. introduction etc) and Learning and growth (time for
• KPI target value. product development, product life cycle, time to
market etc).
The set of KPIs is developed in a deployment/
feedback-process aligned with overall vision, LAGGING AND LEADING WHO WHAT HOW WHAT WHAT
needs to make information is should the KPI is the KPI data gathering/
objective and goals, as illustrated [3]: Lagging indicators are typically “output” oriented and
a decision? necessary? be presented? definition? analysis method?
external KPIs concerning effectiveness dimensions;
if the right work is done altogether. Leading indica-
tors are typically “input” oriented and internal KPIs
concerning efficiency dimensions of analyzing if work
DEPLOYMENT

VISION is done in the right way. Leading indicators will in the

end influence the lagging indicator.
FEEDBACK

BUSINESS
OBJECTIVES

STRATEGIC GOALS
It is essential to have a PULL-approach when defining the KPIs. Start thinking about who needs to make a decision, since the KPIs
CRITICAL SUCCESS FACTORS Leading / internal KPIs should assist in the decision-making. The next step is to decide what information is necessary for that decision-maker and how it
should be presented to convey the information in the best way. First when this is clear it is time to define in detail what properties to
CRITICAL TASKS ACTION PLAN
measure and how.
PERFORMANCE MEASURE
Financial Non-financial
KPIs KPIs

The Balanced Scorecard is probably the best known

of the multi-dimensional performance measure-
ment frameworks developed in the late 1980s and Lagging / external KPIs
early 1990s. The aim was to be more proactive and
emphasise a balance between financial, internal,
non-financial and external measures.

18 19
 Name First pass yield (FPY)
Design Objective Improve quality

- Defining KPIs Description The first pass yield (FPY) designates the percentage of products, which full
fill the quality requirements in the first process run without reworks (good
parts). It is expressed as the ratio between good parts (GP) and inspected
parts (IP).

There is now a strong consensus that KPIs When designing the KPIs, it is worth having SMART Formula FPY = GP / IP
should be derived from strategy. In addition, it is objectives in mind [4], meaning they should be:
central to develop the KPI based on the use and Unit %
need of information for decisions. On an over- Specific A specific area for improvement.
Target value (range 0-100%) 2017: 97%
all level, literature mentions two general usage Measurable Quantify or at least suggest an
areas of KPIs [1]. First, the KPIs should support indicator of progress. Frequency Reported every shift
in measuring the success of the implementation Assignable Clear who will do it.
of the defined strategy. Second, the information Realistic results that can realistically be Source Inspection station
and feedback from the KPIs should be used to achieved, given available resources. Who report Operator at inspection station
challenge the assumptions and test the validity of Time-related Specified when the result(s) can
the strategy. be achieved. Who acts Manager

KPI definition template with First pass yield as an example.

KPIs SHOULD:
Be related to the company’s objectives and manufacturing strategy.
Support the comparison of organizations which are in the same business. WITNESSED PITFALLS TO AVOID WHEN DESIGNING KPIs:
Acknowledge differences between departments, sites and circumstances.
Be under control of the evaluated organizational unit. ENVIRONMENTAL KPIs • Too many KPIs. There is a tendency to add KPIs but not to remove. This creates
Provide fast feedback. The current practice of environmental unclear priorities and confusion.
Stimulate continuous improvement rather than simply monitor. KPIs suffer three typical shortcomings:
Be selected through discussions with the people involved (customers,
• Unclear or complicated definition of KPI. This can create lack of accuracy and
non-intuitive actions, but also loss of acceptance and misuse of the KPI.
employees, managers). • System level: KPIs are well repre-
Have a clear purpose. sented on site or company level,
• KPIs that are not possible to influence on lower levels. Creates loss of accep-
Have clearly defined data collection and calculation methods. less on work station and team level. tance and frustration.
Be simple and easy to use. • Topic: KPIs are well represented
Preferably be ratio-based and not absolute. on energy usage, less on material • Measuring what is available, not was is needed. From a technology point of view,
Preferably be objective and not subjective. efficiency. massive amount of data is available. The relevant analytics and synthesis of data
• Frequency: KPIs are well repre- is the challenge.
sented in annual environmental
reports, less in daily improvement • Sub-optimization. Optimising on a KPI in one part of the value chain might create
efforts. negative consequences for another.

20 21
 TIME ELEMENTS

Design Planned busy time

Planned run time per item
The planned time when a work unit can produce products
The planned time for producing one product

– Basic Elements Planned scrap quantity The number of expected process-related scrap
Actual unit delay time Time for unplanned stops due to e.g. mal-function
Actual unit setup time Time for preparation of a work order
Elements are the measures and set values that aggregated upwards in the organisation.
are used to calculate KPIs. Some elements Actual personnel attendance time The time that the personnel is available to work on production orders.
can act as KPIs by themselves. A pitfall when Most elements are either times (e.g. Processing Actual personnel work time The time a worker needs to produce one production order
designing KPIs are that they are not clearly time) or amounts (e.g. Products produced). The
Actual order execution time The time from start to end of a production order
defined and understood. This can happen when elements presented in this section are some of
the perception of the elements in a KPI differs the elements that are standardized in ISO 22400. Actual production time The time that a work unit is producing
in the organisation. For example, people in the The authors recommend companies to use these, Time between failures The busy time between two consecutive failures at a work unit
same organisation can have different ideas but any elements might work as long as they are
Time to repair The time a work unit is unavailable due to failure
about what cycle time (or “Planned run time per well defined and standardized within the company.
item” according to ISO 22400) is. Does it include Corrective maintenance time The time when corrective maintenance is performed at the work unit
the material handling? Does it include distur- It is essential that every company uses well Preventive maintenance time The time when preventive maintenance is performed at the work unit
bances? These and similar uncertainties have defined elements, if not, there will be a constant
a large influence on the BPMS as a whole as discussion within the company about the validity AMOUNT ELEMENTS
the elements are used to calculate KPIs and are and effect of different KPIs. Produced quantity Number of products produced in a production order
Scrap quantity Produced quantity that do not meet the quality requirements and needs to
be scraped
REFERENCE TIME (CALENDAR TIME)
Good quantity Produced quantity that meets the quality requirements

PLANNED OPERATION TIME

NO Rework quantity Produced quantity that do not meet the quality requirements but can be
PRODUCTION reworked to meet the quality requirements

PLANNED BUSY TIME PLANNED DUE TO Storage and transportation loss Number of products lost in storage or transportation
DOWN TIME NO ORDERS
Inspected quantity Inspected quantity
ACTUAL UNIT BUSY TIME ACTUAL UNIT DUE TO TRANSPORTS
DOWN TIME AND QUEUEING Raw materials inventory Amount of material that will be transformed into finished goods [kg, m3
etc.]
ACTUAL UNIT PROCESS TIME ACTUAL UNIT DUE TO
DELAY TIME BREAK DOWNS Finished goods inventory Amount of finished goods that can be delivered [kg, m3 etc.]

ACTUAL UNIT
Consumable inventory The amount of material that is consumed during the production process
ACTUAL PRODUCTION TIME [kg, m3 etc.]
SETUP TIME

Consumed material The amount of material that has been consumed in the process [kg, m3
The time bar model explains how the different time elements from the ISO 22400 standard are related to each other. The model etc.]
shows how the planned operation time is the sum of all other time elements and can be used as a tool to visualise where most of Work in process inventory The amount of material that is assigned to a production order
the productivity losses are created.
Failure event count Number of events when the work unit is unavailable due to failures
Equipment production capacity The maximum number of products that can be produced in a production
equipment during a set time period
22 23
 Design
- Recommended KPIs PRODUCTIVITY
Worker efficiency Describes the relationship between the time the employee works and the atten-
dance time.
Worker efficiency = Actual personnel work time / Actual personnel attendance time
The KPIs in the following list are based on ISO All the KPIs are not intended to be used on all hi-
22400 and complemented with KPIs from the erarchical levels and generally it is recommended Throughput rate How much time it takes for one quantity to pass through the production system.
Throughput rate = Produced quantity / Actual order execution time
literature as well as KPIs used by the companies to use as few KPIs as possible.
participating in SuRE BPMS. The KPIs are sorted The purpose of this list is to serve as inspiration Overall equipment effectiveness A comprehensive KPI that Indicates the efficiency of a work unit.
into different categories to stress the importance in the design phase. The KPIs may have to be ad- Overall equipment effectiveness = Availability * Effectiveness * Quality ratio
of balancing different perspectives in the BPMS. justed or specified in order to suit your company.
Availability Indicates how much of the planned busy time that the production unit is actually
producing.
FINANCIAL Availability = Actual production time / Planned busy time
Inventory turns Measures the average number of times the inventory stock is replenished and
is used as an efficiency measure. Effectiveness Indicates the relationship between the planned cycle time and the actual cycle time.
Inventory turns = throughput / average inventory Effectiveness = Planned runtime per item * Produced quantity / Actual production time
Scrap and rework cost The value of rework and scraped products

Manufacturing cost per unit The cost of producing on unit QUALITY

Quality ratio Shows the share of the produced products that meet the quality requirements.
HUMAN RESOURCES Quality ratio = Good quantity / Produced quantity
Actual personnel attendance time The time that the personnel is available to work on production orders. Actual to planned scrap ratio Shows how much of the planned amount of scrap that is actually scraped.
Actual to planned scrap ratio = Scrap quantity / Planned scrap quantity
Absence from work Percentage or amount of employee absence due to different reasons.
First pass yield The percentage of the inspected products that fulfills the quality requirements
No. of training hours per employee How much time is spent on training the employees without rework.
First pass yield = Good quantity / Inspected quantity
Employee satisfaction rate Often measured by an employee satisfaction survey
Scrap ratio Shows the share of the produced products that are scraped.
Scrap ratio = Scrap quantity / Produced quantity
Male to female ratio Indicates the share of male or female employees
Rework ratio Shows the share of the produced products that requires rework in order to meet
Employee turnover The number of employees leaving their job divided by the average number of the quality requirements.
employees Rework ratio = Rework quantity / Produced quantity
Overtime Measures the amount of overtime
Storage and transportation loss Share of products lost during storage and transportation and the amount of
ratio consumed material.
IMPROVEMENTS Storage and transport loss ratio = Storage and transport loss / Consumed material
Level of housekeeping Often measured using monthly 5S audits
Number of suggestions The average number of improvement suggestions made by the employees
per employee
Number of implemented How many of the improvement suggestions have been implemented
improvement suggestions

24 25
 FLEXIBILITY SPEED
Actual order execution time The time from start to end of a production order
Batch size How large batches are produced

Percent of employees cross How many of the employees are trained on all tasks in e.g. A work unit Actual unit busy time The time that a work unit needs to execute a production order
trained to perform all tasks

Percentage of personnel from The number of personnel employed by temporary work agency in relation to the SUPPLY CHAIN
temporary work agencies total number of personnel Customer complaints How many complaints are received from the customers
Customer satisfaction Often measured by a customer satisfaction survey
Number of models produced in How many different models can be produced in the same production system
one line Supplier quality How much of the material received from suppliers meet the
Late order changes How many orders are changed late in the process quality requirements
Supplier delivery on time How many of the deliveries from suppliers are on time
Actual unit setup time Time for preparation of a work order
SAFETY
DELIVERY Accidents Number of accidents with injury
Produced quantity Number of products produced in a production order Incidents Number of incidents without injury

Percentage on time delivery Indicates the share of deliveries that are done on time Eliminated risks Number of eliminated safety risks

ENVIRONMENTAL
EQUIPMENT Water use How much water is used
Mean operating time between Statistical indication of the mean operating time between failures. Recycled water ratio The share of recycled water used
failures Mean operating time between failure = ∑ Time between failure for a work unit
Energy use How much energy is used
for all failure instances / (Failure event count +1)
Renewable energy fraction The share of renewable energy
Mean time to repair Statistical indication of the mean operating time it takes to repair a work unit.
Mean time to repair = ∑ Time to repair for a work unit for all failure instances / Use of packaging material How much packaging material is used
(Failure event count +1) Share of reused or recycled material How much of the material is reused or recycled
Corrective maintenance ratio Indicates how much of the total maintenance time that is spent on corrective
maintenance. Waste Amount of waste of different types e.g. Consumables, hazardous waste
Corrective maintenance ratio = Corrective maintenance time / (Corrective
maintenance time + Predictive maintenance time)
Emission kg of emission of e.g. Ozone depleting substances, green-house gases, and
Equipment load ratio Indicates how much of the capacity of an equipment that is used. other environmental affecting gases
Equipment load ratio = Produced quantity / Equipment production capacity
Material use per unit of production kg/PU or m2/PU, can be different types of material
Actual unit delay time Time for unplanned stops due to e.g. mal-function

26 27
 Productivity

Design
- Setting targets
Reliability Speed
Targets need to be set for all KPIs. For some KPIs Setting target levels is not an easy task and there
the target level is obvious and therefore unnec- are a number of factors that complicate the target
essary to state explicit, for example the target for setting: Target
number of accidents (should be zero).
• Targets cannot be set appropriately without knowing Actual
There are many targets where the ultimate goal is current and future process capability.
given, for example everything that can be 100%, • Targets do not explain how to improve performance.
such as Delivery accuracy. However, for several • Targets provoke cheating, including either
reasons the company may choose not to set it to distortion of the data or distorting the way the
100%, but rather a lower value. The value can be work gets done. Quality Flexibility
based on one or several of the following princi-
ples, and there is not one best solution: Setting targets is always a compromise between A spider web diagram can illustrate goal categories and the actual present level.
different objectives and the interest of different
• Top-down breakdown from strategic objectives. stakeholders [5]:
• Bottom-up calculation to get a theoretical
ideal value. • If set too high, targets create stress and
• Historical data: averages or best observed. de-motivation;
• Best practice in business. • if set too low, targets encourage complacency;
• Challenging levels to promote continuous • if imposed, targets are unlikely to be owned by
improvements. those who have to deliver them; and
• if negotiated, there is an incentive to press for
lower targets that are easier to meet.

ONLY HISTORICAL BASES FOR TARGETS

Goals that are set only based on historical results combined with an arbitrary annual
improvement lacks relevance and potential to control and improve the operation.
Historical data can be a starting point for the goal level, but this data needs to be
combined with decided operational improvement initiatives and the improvement
these are expected to result in. This will lead to a higher level of ambition since results
of every improvement initiative are explicitly connected to the goals of relevant KPIs.

A control chart is a way to understand the variation in different KPIs.

28 29
 Implementation
CORPORATE
A successful implementation is dependent on A bottomup flow of information needs to be estab-

PRIORITIZE AND INITIATE IMPROVEMENT ACTIVITIES

creating understanding and motivation bringing lished through aggregation of lower level KPIs (see
everyone to be involved, in a strategy deployment the right hand illustration). Equally important is the
process. The presence of management is of cru- top–down feedback of reactions, actions and chang- REGION
cial importance to establish motivation through- es based on the information and understanding this
out the organization. The clarity of the manage- brings about.
ment´s message and setting reachable goals are
triggers for motivation as well as to improve for DEFINE ORGANIZATIONAL ROLES SITE
the sake of the company and the employees. The functionality of the BPMS is dependent on a
Showing how practical examples of improve- clear distribution of roles and an engaged organiza-

REPORTS
ments have positive effects will support involving tion running, maintaining and revising the system.
the workforce in measuring activities. Employees need to be assigned responsibilities
for data collection, aggregation, visualization, and DIVISION
SETTING UP WORK PROCEDURES reporting, as well as to identify and initiate activities.
Work procedures for data collection, visualization
and aggregation need to be developed. Based EDUCATING THE ORGANIZATION
on the KPI definition the data sources for the The organization needs to have a common view and
separate elements needs to be identified, also understanding of what to measure, how and why. In AREA
the data quality should be secured. If the data is addition, each stakeholder involved needs to clearly
not already available, it is preferable to set up an understand their role and responsibility in the pro-
automatic digital data acquisition solution. If that cess. The education and preparation therefor have
is not possible, templates for manual data acqui- to encompass the following:
sition should be carefully designed. It is better to • The link to the corporate and the manufacturing
TEAM
measure manually than not measuring at all. strategy.
The transformation of data into information and • The definition of the KPI and its elements, as
further into understanding is crucial to be able to well as how the result should be interpreted.
decide on actions to take if targets and goals are • Information about the different roles, clarifying The strategy deployment process and feedback though reports.
not met. who should be communicating with whom.

ESTABLISH A METHOD FOR DATA COLLECTION

Taking the right action is dependent on the quality of the data acquired. The data source should also
DATA INFORMATION KNOWLEDGE UNDERSTANDING
be considered.

CHOOSE OR DEVELOP IT SUPPORT

An IT-based automatic data acquisition solution is highly preferable. If that is not feasible a manual Transformation of data to understanding for reporting.
method needs to be put in place. Manual data acquisition systems provide less reliable and accurate
data and is more time consuming, both to acquire and to visualize and aggregate.

30 31
 Use
- Measure
Several types of elements might be needed to methods might provide less reliable data and are MES Software 09:24
calculate a KPI and these could come from differ- more time consuming when it comes to calculating
ent data sources. Some elements are not mea- and visualizing KPIs.
sured, but rather set, such as “Planned runtime Company Y, Site X, Line B, Station 8-13 Operator: A. Beson
per item”. Based on the definition of a KPI and Since the purpose of monitoring should be to
the elements included in the mathematical formu- improve, the data collection system should also
lation, the data source for each element needs to include information about e.g. reasons for down-
be identified. For example, “Percentage on time times or speed losses if OEE, tact or productivity is A stop occurred
delivery”, should the information be gathered by monitored, or reasons for quality defects if quality is
the shipping personnel at the company or by the monitored. This is needed to initiate the appropriate Order ID: X885-2342-11
receiving personnel at the customer? It depends improvement activities. To conclude: Time interval: 9:15:43-9:22:46
on who is responsible for the logistic services.
• Reliable data need to be retrieved for each ele-
Stop time: 0:7:03
The data source might be manual or automatic. ment in the KPI definition. If data is not currently
An IT supported automatic data acquisition solu-
tion is preferable. If setting up a digital data ac-
collected or available in any company data-
base, data acquisition needs to be installed and Register the stop reason
quisition solution is not feasible, manual methods secured.
need to be implemented. To support standards • Automatically operated digital data acquisition
Lack of Machine Operator on
procedures and homogenous data input, tem- solutions are preferable, but it is better to moni- Sensor error
plates should be designed and clear and concise tor manually that not monitor at all. material setup break
instructions developed to support the employees • Data collection should not just be to register a
in understanding how and what to measure. It number or a value but also additional informa- Machine Operator Out of cutting
should be noted that manual data acquisition tion for guiding further improvement actions. Other reason
breakdown occupied fluid
MANUFACTURING EXECUTION SYSTEMS (MES)
Data acquisition software is usually a part of a Manufacturing Execution Systems (MES). The
MES integrates the data collection with the production planning system. The technological An example of an interface of a data acquisition software. It is very important to have clear definitions of all the stop reasons, and further
development of data acquisition technology is fast, sensors and communication devices get to use the registered data to actually eliminate frequent disturbances. If the operator feels that the information isn’t used, he or she will
faster and cheaper. Common technology today for data acquisition: not bother to register correctly.

• Bar and QR codes with optical readers

• RFID (Radio-frequency identification)
• Optical, inductive, or mechanical sensors
• PLC or machine control system data

32 33
 Use
– Compile and Analyze

Your KPIs should help you to understand how However, as an example, by visualizing variation
your organization is performing in comparison to using e.g. a control chart, much more information
the corporate visions and goals and guide you about the process will occur. It will show if the
to the right actions. For the KPI to assist in the process is stable, predictable, and only contains UNSTABLE, STABLE, UNSTABLE, STABLE, STABLE,
decision-making it is necessary to first define chance causes of variation. If the process instead is small variation! large variation! large variation! deviates from target! on target!
the decision-makers and state what information unstable, it is unpredictable. From a decision-mak-
is needed as well as how it should be presented ing perspective, it is important to understand the Different types of variation.
to convey the information in the best way. First difference since they call for totally different actions.
when this is clear it is time to define what proper- An improvement of a stable process often requires
ties to measure and how. That is the foundation a change of the entire process, a decision made on
for being able to compile and analyze the KPIs in a high management level. Improving an unstable
the best way. process, containing one or a few unpredictable and
traceable causes of variation, is often possible at
LEADING AND LAGGING KPIS shop floor level. USING AVERAGE VALUES
One should also reflect upon if the KPIs are lag- It is common to use aggregated, average values on KPIs. Sometimes it is only displayed as
ging or leading. Lagging indicators are typically ING a two-point-comparison, stating if the target was reached or not. There is a risk of asking
LAGG

“output” oriented, easy to measure but hard to the wrong questions and keeping the organization busy trying to eliminate random variation
improve or influence. In a business context an ex- in vain.
ample of a lagging indicator is revenue. Leading
indicators are typically “input” oriented, harder to
measure but easier to influence. The increase in
quality defects could be an example of a lead-
ing indicator that in the end would influence the
lagging indicator revenue. DISPLAY VARIATION
If variation is displayed, e.g. by using a control chart, the manager will be able to ask the
VISUALIZING VARIATION right questions to reveal causes instead of symptoms. The focus will be on the process,
To present the data in a way that it is understand- the variation and any signs of instability. A BPMS could benefit threefold when adopting
able and at the same time contains as much this way of analyzing and presenting the data. Firstly, by getting the ability of guidance on
information as possible could be a challenge. suitable actions. Secondly, is the possibility of prediction, since a stable process can be
expected to deliver within the control limits. Finally, is the opportunity to monitor a process
and get a warning signal if the process changes and becomes unstable.

34 35
 Use
– Report and Make decisions

REPORTS
There are many stakeholders to each organi- • Provide different stakeholders with right information.
zation who need reports about the operation. • Differ between measures that should trigger action
Most stakeholders are internal, i.e. part of the on the level collected and those that will be reported
same organization, but there are also external to other corporate levels or external stakeholders.
stakeholders that require reports, such as tax
authorities and environmental organizations. The MAKE DECISIONS
reports have different purposes depending on Checklist for decision making:
the stakeholders’ interest. Some are for making • Secure engagement from decision makers by report-
direct decisions, e.g. how much carbon tax the ing the right thing to the right stakeholders.
company should pay, while other data reported • Review performance and create a list of action to
externally may be for analysis and actions that lay remedy problems or reach targets.
much further in the future. Most reports used in • Prioritize between actions.
the daily operation are communicated in oral form • Decide on targets for prioritizing and use tools for
and maybe documented by the KPI value only on different targets (e.g. cost simulation for cost targets).
a whiteboard. • Discuss scenarios for what could be gained or lost if
an action is postponed in time.
Checklist for reports: • Discuss risks and benefits of different causes of
• Decide on a structure of reporting that is action.
easy to understand. • Do not focus on only each measure and hitting the
• Decide on an appropriate reporting interval numbers, a systems view is sometimes necessary to
(can differ between measures and purpose of adopt.
reporting). • Follow up if a decision led to the intended effect.

Digital dashboards can be used in decision making.

36 37
 WE PRODUCE IN A
SAFE WAY

Revise
TOTAL RECORDABLE
HEALTH LOST TIME INJURY TOTAL RECORDABLE NUMBER OF NEAR NUMBER OF RISKS % OF SOLVED RISKS
INJURY FREQUENCY
ATTENDANCE FREQUENCY RATE INJURIES MISSES REPORTED REPORTED
RATE

Performance measures should reflect both the appropriate data. Finally, triggers represent changes in HAS AN ACCIDENT,
PERSONNEL SAFETY ROUND IN TOTAL RECORDABLE NEAR MISS OR RISK NUMBER OF SOLVED % OF SOLVED RISKS
internal and external environments of organi- the internal or external environment that initiate a revision AVAILABLE OR NOT TIME INJURIES
MONTHLY AUDIT
HAPPENED DURING RISKS
THE DAY
sations. As the competitive environment of a of the BPMS.
company changes, the KPIs must be adjusted
accordingly. Organizations often add KPIs more PRESENT STATE ANALYSIS METHOD
frequently than they delete them and therefore To perform the revision on level B and C, a present state
HAS AN ACCIDENT,
PERSONNEL LOWER THE VALUE
NEAR MISS OR RISK NUMBER OF SOLVED
AVAILABLE OR NOT OF CONSEQUENCES
the set of KPIs need to be continuously evaluat- analysis method with four steps can be used: OF A RISK
HAPPENED DURING
THE DAY
RISKS

ed and questioned. The BPMS and KPIs can be

revised on four levels [1]: 1. Management interviews: The strategic goals and the
BPMS structure is identified and described. Aggregation of the same KPI
STRATEGIC LEVEL
A. Revision of the strategy, PMS architecture and 2. Mapping of KPIs: All KPIs used at all hierarchical
cascading structure levels in the organisation is mapped and documented SITE LEVEL Mathematical relation
B. Revision by omitting or adding KPIs. in a standardised way.
C. Revising an individual KPI definition. 3. Rationalization potential: All mapped KPIs are com- AREA LEVEL Other logical relation
D. Revising the KPI target value pared to determine if there are KPIs measuring the
WORK CENTER LEVEL
same thing or having the same purpose. The purpose An example of the fourth step in the present state analysis method. In this example the strategic objective
In order to manage BPMS revisions, five factors of this step is to identify redundancies and stan- “We produce in a safe way” is related to KPIs on site level, area level and work center level. There are
should be considered [6]: culture, processes, dardise KPI definitions within the organisation. three different types of relations, aggregation, mathematical and other logical relations. Some KPIs are not
people, systems and triggers. The culture within 4. Interrelations between KPIs and strategic goals: clearly related to the other indicators or the strategic objective.
the organization should ensure that the KPIs are The relations between KPIs on different hierarchical
used, appreciated and relevant. There need to levels and to the strategic goals are identified and
be processes in place for reviewing, modifying visualised (see figure on next page). This analysis
and deploying KPIs. It is also necessary that the shows how well the strategy is deployed throughout
people in the organisation have the required skills the organisation and if there are any missing KPIs in
to use and revise the BPMS and that there are relation to the strategy. It is also identifies the KPIs
information systems that are able to handle the that are not related to any goals or other KPIs. About 2 % of the total work time in the companies studied in
the research project is spent on meetings where the results
of KPIs are discussed. Therefore, it is important to revise the
KPIs regularly to maintain an efficient BPMS so that only
relevant information is discussed during these meetings.

38 39
 KPIs in early ADVANCED ENG INEERING PROJ ECT OPERATIONAL KEY

development phases
ENABLING INDICATORS DEFINITION PERFORMANCE
INDICATORS INDICATORS
BOP compliance
Quality deviations
# Inspections QUALITY
…
Problem solving speed First Time Through
Performance Indicators are not only essential projects moves from the concept stage into the
during operational phases of all the organiza- realization stage and further to the operational
tion’s processes. Also during the development stage. For example is OEE not a suitable early Dock-to-dock time
Unit handling … Flow efficiency
phases of both product and production systems, phase KPI since no reliable data on performance WIP WIP
…
where future performance of the operational is available. Instead equipment capacity or Flow time efficiency DELIVERY
order-to-delivery-process is set, KPIs are import- “planned runtime per item” is more appropriate, Value Adding Space …
Efficiency
ant to consider. The KPIs designed to monitor since the equipment provider can contribute with Work load variation
progress in early development phases might not this information. Productivity
…
have the same scope or purpose as those used Trapped operators
during operation, therefore the set of KPIs can It is also advisory to perform risk or sensitivity
… FINANCE
and should evolve from the start of a new green- assessments, when there is a lack of reliable Automation level
field project to when operation is running accord- data. This will indicate how different parameters IMPROVEMENT
ing to plan. In setting up a new plant an early influence e.g. costs, and will identify key influ- …
Ergonomic deviations Ergonomic deviations
phase activity can be to simulate the layout and ential parameters that are important to consider PERSONNEL
…
capacity of different options. This would require throughout the project. Common areas of interest
a certain set of KPIs to feed into the simulation in early phases relate to e.g. cost analyzes, Capacity utilization … Resource efficiency SUSTAINABILITY
software. Considering operational KPIs already in throughput scenarios or work environment and
development phases will support future opera- workplace design principles.
tional top-class performance.
Advanced Production Production Production
Operation
Engineering tools are essential instruments to engineering preparation realization ramp-up
To consider and assess the future outcomes of assess future performance of the product and
operational KPIs already in development phases production system during development stages.
is a challenge, since the amount of data and Product behaviour is verified by various CAD
information is limited. The principle suggested and FEM tools, producibility is verified by risk The figure illustrates how “enabling indicators” were defined by one industrial project partner in early phases of product and process
here, is to define areas of “enabling indicators” analysis, CAM tools and DFA/DFM methods, development. These could later be aligned and support later stage “project definition indicators” (not defined in figure) and later also
that can be analyzed or assessed in early phases and production system performance and cost operational KPIs. The principle is to establish this alignment within each KPI area (Quality, Delivery etc) throughout the life cycle of the
of product and production development. These is assessed by simulation and analytical tools. production system, starting off in Advanced Engineering throughout Production preparation, Production realization, Production ramp-up,
early phase KPIs need to be supported by de- These tools can all be used to guide towards a and finally Operation.
fined means of calculation or assessment. The high performing operational system, in terms of
“enabling indicators” could be operational KPIs different KPIs.
or be transformed into operational KPIs as the

40 41
 References Further reading Publications from the SuRE BPMS project
[1] Bourne, M., Mills, J., Wilcox, M., Neely, A. & Bititci, U., Turner, T. & Begemann, C. (2000) Ericson Öberg A., Hammersberg P., Fundin A. (2017) Landström, A., Almström, P. & Winroth, M. (2017) “Review of
Platts, K. (2000) “Designing, implementing and “Dynamics of performance measurement systems”, “Factors influencing control charts usage of operational a performance measurement system at shop-floor level”, pre-
updating performance measurement systems”, International Journal of Operations & Production measures”, Measuring Business Excellence, Vol. 21 Issue: sented at the 24th EurOMA conference, Edinburgh, Scotland.
International Journal of Operations & Production Management, Vol. 20 Issue 6 pp. 692 – 704. 3, pp.225-238. Nafisi, M., Wiktorsson, M. (2017) “Ensuring manufactur-
Management, Vol. 20 Issue 7 pp. 754-771. Ericson Öberg, A, Andersson, C, Hammersberg, P, and ability in early stages of new product development: a com-
Bourne, M., Bourne, P. (2011) “Handbook of Windmark, C. (2016) “The absence of variation in key perfor- parative study of two practices.” 24th EurOMA Conference,
[2] ISO (2014) “ISO 22400-2:2014 Automation sys- Corporate Performance Management”, John Wiley mance indicators”, Proceedings of PMA Conference, 26–29 Edinburgh, UK.
tems and integration -- Key performance indicators & Sons, Ltd, UK. June 2016, Edinburgh, UK. Shahbazi, S., Amprazis, P. (2017) “Improve material
(KPIs) for manufacturing operations management Ericson Öberg, A, Braunias, S, Andersson,C, and Ham- efficiency through an assessment and mapping tool”, 23rd
-- Part 2: Definitions and descriptions”, the Interna- Deming W.E. (1994) “The New Economics for mersberg, P. (2016) “Changing from watermelon mea- annual conference of International Sustainable Development
tional Organization for Standardization, Geneva. Industry, Government”, Education, Cambridge, MA: sures to real decision support: including information about Research Society (ISDRS), Bogotá, Colombia.
MIT Press. variation in performance measurements”. Proceedings of Shahbazi, S., Salloum, M., Kurdve, M., & Wiktorsson, M.
[3] Bititci, U. S., Carrie, A. S., & McDevitt, L. the 5th World Conference on Production and Operations (2017) “Material Efficiency Measurement: Empirical Investi-
(1997) “Integrated Performance Measurement Sys- Kennerley, M. & Neely, A. (2002) “A framework of Management P&OM Havana 2016, 6–10 September 2016, gation of Manufacturing Industry”. Procedia Manufacturing,
tems: an audit and development guide”. The TQM the factors affecting the evolution of performance Havana, Cuba. 8, 112-120.
Magazine, 9(1), pp. 46-53. measurement systems “, International Journal of Ericson Öberg, A. (2016) “Predictability: an enabler of weld Shahbazi, S., Wiktorsson, M. (2016) “Using the Green
Operations & Production Management, Vol. 22 production development”, Doctoral thesis, Department of Performance Map: towards material efficiency measure-
[4] Doran, G. T. (1981). “There’s a S.M.A.R.T. way Issue 11 pp. 1222 – 1245. Materials and Manufacturing Technology”, Chalmers ment”, 23rd EurOMA Conference, Trondheim, Norway.
to write management’s goals and objectives”. Man- University of Technology. Shahbazi, S., Wiktorsson, M., Kurdve, M., Jönsson, C,
agement Review. AMA FORUM. 70 (11): 35–36. Neely A. (1999) “Performance measurement sys- Kurdve, M., Landström, A., Ericson Öberg, A., Zackris- Bjelkemyr, M. (2016) “Material efficiency in manufacturing:
tem design: a literature review and research agen- son, M., Persson, K., Myrelid, A., Trollsfjord, P., Berglund, Swedish evidence on potential, barriers and strategies”,
[5] Meekings, A., Briault, S. & Neely, A. (2011) da”, Int. J. of Operations & Production Managment, R. & Harlin, U. (2016) “Implementation of daily visual Journal of Cleaner Production, Vol. 127, P. 438–450.
“How to avoid the problems of target‐setting”, Vol. 15 Issue: 4, pp.80-116. management at five small and medium sized enterprises in Windmark C., Andersson. C. (2016) “Analysis of the poten-
Measuring Business Excellence, Vol. 15 Issue: 3, Produktionslyftet compared to six larger Swedish compa- tial of assessing sustainable production with a cost model”,
pp.86-98. Neely, A., Adams, C. & Kennerley, M. (2002) “The nies”. In proceedings of Swedish production symposium, presented at the 7th Swedish Production Symposium, Lund,
Performance Prism”. Prentice Hall: Harlow, UK. Lund, Sweden, November 25-27. Sweden.
[6] Kennerley, M., Neely, A. & Adams, C. (2003) Landström A., Almström P., Winroth M., Andersson C., Winroth M, Almström P, Andersson C. (2016) “Sustainable
”Survival of the fittest: measuring performance in a Wheeler D. (2000) “Understanding Variation The Windmark C., Shahbazi S., Wiktorsson M., Kurdve M., Production Indicators at Factory Level”, Journal of manufac-
changing business environment”, Measuring Busi- Key to Managing Chaos”, 2nd ed., Knoxville, TN: Zackrisson M., Ericson Öberg A., Myrelid A. (2016) “Pres- turing Technology Management, Vol. 27 Issue 6 pp. 842-873.
ness Excellence, Vol. 7 Issue 4 pp. 37-43. SPC Press. ent state analysis of business performance measurement Zackrisson, M., Kurdve, M., Shahbazi, S., Wiktorsson,
systems in large manufacturing companies”, Proceedings of M., Winroth, M., Landström, A., Almström P., Andersson
PMA Conference, 26–29 June 2016, Edinburgh, UK. C., Windmark C., Myrelid, A. (2017) “Sustainability Perfor-
Landström, A., Almström, P. & Winroth, M. (2016) mance Indicators at Shop Floor Level in Large
“Performance indicators at different organisational levels in Manufacturing Companies”. Procedia CIRP, 61, 457-462.
manufacturing companies”, presented at the 7th Swedish
Production Symposium, Lund, Sweden.

42 43
 Authors
PETER ALMSTRÖM, Assoc. Professor SASHA SHAHBAZI, PhD candidate
Chalmers University of Technology Mälardalen University
Dept. of Technology Management and Economics School of Innovation, Design and Engineering
[email protected] [email protected]
+46 761010567 +46 736620915

CARIN ANDERSSON, Professor MAGNUS WIKTORSSON, Professor

Lund University Mälardalen University
Dept. of Mechanical Engineering School of Innovation, Design and Engineering
[email protected] [email protected]
+46 702509539 +46 739607499

ANNA ERICSON ÖBERG, PhD CHRISTINA WINDMARK, PhD candidate

Volvo Construction Equipment AB Lund University
Manufacturing Research Operations Europe Dept. of Mechanical Engineering
[email protected] [email protected]
+46 737656441 +46 462224388

PETER HAMMERSBERG, PhD MATS WINROTH, Professor

Chalmers University of Technology Chalmers University of Technology
Dept. of Industrial and Material Science Dept. of Technology Management and Economics
[email protected] [email protected]
+46 761 19 14 53 +46 761257053

MARTIN KURDVE, PhD MATS ZACKRISSON, Lic. Eng.

Swerea IVF AB Swerea IVF AB
Energy and Environment Energy and Environment
[email protected] [email protected]
+46 707806132 +46 8203953

ANNA LANDSTRÖM, PhD candidate

Chalmers University of Technology
Dept. of Technology Management and Economics
[email protected]
+46 729862686

44