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What are KPIs and what are they (Part 2)

KZK Solutions /kzoli62/
Published by Z. Kovács in Production · 12 November 2021
Tags: Production;KPI
As I wrote last time, I will now continue with the transport indicators.

OTD (On Time Delivery) and COTD (Customer On Time Delivery) Orders fulfillment

The OTD is a key performance indicator (KPI) that includes compliance with the regulation. OTD is part of the entire supply chain management, which includes booking, delivery reliability and delivery performance. The OTD measurement indicates the period or time window in which the shipment can take place.

As a KPI, OTD is a way to monitor and analyze performance. You need to know how efficiently and effectively the whole process works.

Based on the above, it can be measured in a daily, weekly, monthly time window. Daily measurement makes sense if it is important if the manufacturer works with a daily delivery, JIT (Just In Time) or JIS (Just In Sequence) system.

I tend to distinguish between two types:

OTD = Actual delivery quantity / Planned delivery quantity


COTD = Actual Delivery Quantity / Customer Demand

This indicator shows the quality of the delivered products. From its value it can be deduced the efficiency of the production and the manufacturer's quality assurance processes.

QD (Quality Delivery) Delivery quality

Ez az indikátor megmutatja, milyen a kiszállított termékek minősége. Az értékéből következtetni lehet a gyártás és a gyártó minőségbiztosítási folyamatainak hatékonyságára.

Never forget,
Quality must not be ensured, but manufactured !!!

Let's look at the calculation:

QD = quantity of products delivered without complaint / total products delivered

When calculating this indicator, special care must be taken to ensure that any pieces complained of are always assigned to the correct delivery.

Process indicators

Process tracking identifies relevant process KPIs and measures them transparently and continuously, while exploring the root causes of process problems.

In order to have a clear idea of your organization and to be able to make decisions based on facts and data, your management team needs to have a system of intelligent, efficient, and realistic KPIs.

Let's look at the most common indicators:

FPY (First Pass Yield) is a good product at first

The first good return (FPY), also known as throughput return (TPY), divides the number of units leaving the process by the number of units entering the process in that period.

There is a process that is divided into four sub-processes: A, B, C and D.
  • Calculate the yield for each step.
  • Multiply these.
You can also get the total yield for the whole process by simply dividing the number of good products produced by the number of pieces starting at the beginning of the process.

If we calculate the final FPY of several steps, as I mentioned above, this is often called the stacked FPY, RTY (Rolled Throughput Yield).

LTY (Last Time Yild) ultimately a good product

Its calculation is the same as the FPY calculation, but the improved products or the number of NFF (No Failure Found) products.

The permitted number of repairs is usually determined in advance by the customer at the time of concluding the contract. This can be assigned to a process step, e.g. how many times a PCBA can be heated during electronic assembly.

Several companies also use the concepts of SPY (Second Pass Yield) and TPY (Third Pass Yield), which depends on the repair cycles already mentioned.

LTY-FPY also known as repair efficiency

This number alone may not say too much, but if we look deeper, look at the fixes and NFF numbers, we can conclude that:
  • Type defects
  • Process errors
  • Component defects
In many cases, the customer is also curious about the RTPR (Re-test Past Rate).

BTS (Built to shedule)

This indicator helps to determine the extent to which production can follow and meet the schedule given by the planning.

If this is not the case, there are several reasons:

  • The planning is not with updated data such as. cycle time working
  • There is too much loss of time in production for some reason such as e.g. downtime. There are several reasons for this:
    • The technical condition of the machines, which may indicate a lack of maintenance
    • Lack of material, which may indicate a problem with logistics

Let's look at the calculation:

BTS = number of units produced for a given time / number of units planned for a given time

Next time, I will deal with KPIs related to personnel management.

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