How can you use performance measurement to reduce waste in production?

2 Collect and analyze your performance data

The second step is to collect and analyze your performance data regularly and systematically. You can employ various methods and tools for this, such as surveys, observations, records, tests, and models. It's important to use the right methods and tools for your performance indicators, and make sure your data is accurate, reliable, and consistent. Additionally, descriptive and inferential statistics should be used to summarize and interpret your data, so that patterns, trends, and anomalies can be identified.

3 Report and communicate your performance results

The third step is to report and communicate your performance results to your stakeholders, such as managers, employees, customers, or suppliers. You should use clear and concise language, graphs, tables, charts, or dashboards to present your performance results, and highlight the key findings, achievements, and challenges. You should also explain the causes and effects of your performance results, and compare them with your targets, benchmarks, or best practices. You should tailor your reports and communication to the needs and expectations of your stakeholders, and use feedback mechanisms to solicit their opinions and suggestions.

4 Use your performance results to improve your production process

Using performance results to improve your production process is the fourth step. Identify and prioritize areas of improvement, set new or revised goals, objectives, and action plans. Also evaluate and adjust production strategies, policies, and procedures; implement changes or innovations that can enhance production efficiency and effectiveness. Monitor and measure the impact of your improvements, and celebrate successes.

Performance measurement can help you reduce waste in production, leading to cost savings, increased productivity, quality, competitiveness, and organizational learning. However, it requires careful selection of performance indicators that reflect goals and priorities; timely, accurate data collection; clear communication with stakeholders; and systematic use of results to improve the process. Best practices include aligning performance indicators with strategic objectives; establishing a performance measurement system; creating a performance measurement culture; and integrating performance measurement with production planning, control, and improvement. Performance measurement is an ongoing process requiring commitment, collaboration, and adaptation. Use it to reduce waste in production and improve your production performance.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?