In recent years, more and more businesses are taking to the Lean Six Sigma approach to help meet their goals and shareholders’ expectations in the most efficient way possible.
Since Lean Six Sigma combines the best of both Six Sigma and Lean methodologies, it focuses on improving processes. Tracking the process quality through KPIs and metrics is central to achieving Lean Six Sigma objectives for your business. Let’s see the main KPIs and metrics managers should focus on.
What are Lean Six Sigma KPIs and Metrics?
The central goal is to reduce defects and improve efficiency. Metrics and KPIs (Key Performance Indicators) are quantifiable measures of how a process has been performing and its quality.
KPIs and metrics are great ways to benchmark your business processes and compare their relative progress with time. Improving customer satisfaction is key and KPIs can help you how far your business has been successful so far in that objective.
Keep Track of Deadlines with Process Cycle Time
This refers to the time a product takes as it passes through the production cycle. This is on a per-product basis.
Improve Customer Satisfaction with Lead Time
The lead time is the time it takes between a customer placing an order and the product being delivered to them. It’s the total turnaround time it takes your business to meet customer expectations.
Improve Quality with Defect Rate
A defect is a lack of efficiency in the process of product manufacture. Every business should target reducing the defect rate as much as possible. The defect rate measures the number of defects per product unit.
Measure Compliance with Safety Metrics
It is imperative to track and quantify workplace safety. While the metrics differ depending on your business nature, log incidents and injuries and study their trends over several years. You can also track lost workdays to understand the implications incidents have on lost time. Safety metrics are the perfect way to understand compliance with regulations, like the OSHA guidelines.
Measuring labor productivity is a great idea for managers to keep performance goals on track. You can watch out for the number of product units produced per labor hour spent. Alternatively, it can also be measured in terms of monetary costs.
Track People Presence
Certain metrics account for unplanned events which will directly affect business turnover. Track absenteeism rates to know the number of leaves, both approved and unapproved, and the major reasons, including emergencies and illnesses. You should also monitor terminations and employment rates.
Consistency is crucial when managers use metrics to track project progress. A metric or Key Performance Indicator (KPI) is a quantifiable measure of how your business has been performing. KPIs help you see how far you are in your Lean Six Sigma roadmap.
Metrics will immediately identify all areas where there’s a major scope for improvement. Business success is directly impacted by the metrics you select and monitor so identify and choose the best ones based on your methodologies. This improves product quality and bolsters customer satisfaction levels manifold.
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