Performance Indicator Management Flashcards

A maintenance manager observes that the Mean Time Between Failures (MTBF) for a critical asset class has been steadily increasing. However, the overall maintenance cost per unit produced has also increased significantly over the same period. What is the most likely cause of this situation?

Answer: The increase in MTBF is being achieved through an overly aggressive and expensive preventive maintenance program.

An increasing MTBF is a positive lagging indicator of reliability. However, when coupled with a sharp increase in maintenance costs, it often indicates that the improvement is being achieved through excessive or inefficient preventive/predictive maintenance activities. The goal is to optimize reliability at an optimal cost, not to maximize MTBF regardless of expense.

A reliability manager wants to implement performance indicators that provide early warnings of potential future failures and allow for proactive intervention. Which type of indicator should the manager focus on?

Answer: Leading indicators (e.g., PM Compliance)

Leading indicators are predictive measures that track the performance of activities believed to drive future results. PM compliance, schedule compliance, and work order planning accuracy are examples that indicate whether the maintenance process is healthy. A decline in these leading indicators can predict a future decline in lagging indicators like MTBF or OEE.

Which of the following is the BEST example of a leading indicator for maintenance and reliability performance?

Answer: Percent of Planned and Scheduled Work

The percentage of planned and scheduled work is a strong leading indicator. A high percentage suggests that the organization is in control of its maintenance activities, working proactively rather than reactively. This proactive stance is a predictor of future success in reliability. MTBF, OEE, and Rework Percentage are all lagging indicators because they measure the outcomes of past activities.

Senior management has tasked a plant manager with improving the facility's overall reliability. The manager decides to introduce a new set of performance indicators for the maintenance department. What is the most critical first step in developing and implementing these new KPIs?

Answer: Ensure the chosen KPIs are directly aligned with the plant's strategic business goals.

The most critical first step is to ensure that any performance indicators are directly linked to the overall strategic goals of the business (e.g., reduce cost, increase production throughput, improve safety). Without this alignment, departments may focus on improving metrics that do not contribute to what the business actually needs to achieve, potentially driving the wrong behaviors. The other steps are important but follow after strategic alignment is established.

A corporation uses Overall Equipment Effectiveness (OEE) as a primary lagging indicator of manufacturing performance. A maintenance supervisor needs to select a KPI for their team that directly supports and influences the 'Availability' component of OEE. Which KPI would be most appropriate?

Answer: Mean Time To Repair (MTTR)

OEE is calculated as Availability x Performance x Quality. The 'Availability' component is directly impacted by how long equipment is down for repairs. Mean Time To Repair (MTTR) is a measure of the average time it takes to repair a failed piece of equipment. By focusing on reducing MTTR, the maintenance team can directly and positively impact the Availability score, which in turn improves the overall OEE. First Pass Yield relates to Quality, while Production Rate Variance relates to Performance.

A maintenance team has consistently missed its target for 'Weekly Schedule Compliance' for the past three months, with actual compliance hovering around 60% against a target of 90%. What is the most effective next step for the maintenance manager to take?

Answer: Charter a team to perform a root cause analysis on the reasons for schedule breaks.

A performance indicator showing a negative trend is a signal that a process is not performing as expected. The correct response is not to punish individuals or manipulate the target, but to use the data to trigger a formal problem-solving process. A root cause analysis (RCA) will help the team identify the underlying reasons for the schedule breaks (e.g., poor planning, parts unavailability, emergency interruptions) so that effective corrective actions can be implemented.