AN EVALUATION OF FACTORY PERFORMANCE UTILIZED KPI/KAI WITH DATA ENVELOPMENT ANALYSIS(Operations Research for Performance Evaluation)

Koichi Murata, Hiroshi Katayama
2009 Journal of the Operations Research Society of Japan  
In this paper, based on Key Performance Indicator (KPI) and Key Activity Indicator (KAI) as the fundamental data for calculating defined factory performance function, evaluation system of factory performance is discussed by following four phases. 1) Designing framework for evaluation system of factory performance, 2) Constructing structure of KPI/KAI database, 3) Formulating evaluation of factory performance with proposed model utilized Data Envelopment Analysis (DEA) and 4) Classifying
more » ... Classifying analyzed factories based on established factory performance values. Factory Evaluation Based on KPI/KAI by DEA 205 2. Literature Review Key performance indicator/Key activity indicator There are some reports and practical guides about Key Performance Indicator (KPI) and Key Activity Indicator (KAI) in TPM. KPI represents a result of improvement project, e.g. sales, profit, productivity of labor, performance rate of equipment, quality product rate, Mean Time to Failure (MTBF) and Mean Time to Repair (MTTR) [11, 17, 19] . KAI represents a process for achieving a purpose of improvement project, e.g. a total number of education times for employees who tackle performance improvement projects, a total number of employees who pass a public certification examination and an accumulative number of Kaizen cases [11] . Shirose [17] explained two indicators, which are an overall management indicator and KPI for measuring the effect of TPM activities, in fabrication and assembly industries. Aims of measuring two indicators are following four reasons [17]: • To learn if activities of individual echelons lead to positive results • To learn if propriety tasks can be detected from the results Priority tasks to be attained, if the targets are not achieved. Priority tasks for further improvement, if the targets are achieved. • To allow evaluation as to how echelon-based results are connected to profitability improvement and cost reduction for the entire plant Achievement indicators for individual echelons (circle, assistant section manager, section or department manager, plant manager levels) are consistently systemized. • To learn priority problems for individual echelons. Also, 53 indicators of KPI are divided into six groups, i.e. productivity group, quality group, cost group, delivery group, safety group and moral group. JIPM [11] tackled with classification of 97 indicators utilized factories/offices received TPM Awards based on some outline reports of TPM Awards. Procedure for classifying 97 indicators consists of two steps. For the first step, 97 indicators are divided into three groups, i.e. overall management indicator group, KPI group and KAI group. For the second step, each three group derived in the first step is divided into several subgroups. Overall management indicator group consists of two sub-groups, i.e. sales indicator group and profit indicator group. KPI group consists of seven sub-groups, i.e. quality indicator group, cost indicator group, delivery indicator group, productivity indicator group, safety and healthy indicator group, environment indicator group and moral indicator group. KAI group is classified by eight principles in TPM development [7] , i.e. 1) Focused improvement (kaizen) to make equipment more efficient, 2) Autonomous maintenance activities, 3) Planned maintenance for the maintenance department, 4) Technical training in equipment maintenance and operation, 5) An early equipment management problem, 6) Quality maintenance activities, 7) A system for increasing the efficiency of administrative and support function (office TPM) and 8) A system for management of safety and environmental issues. Three kinds of group in the first step of classification as shown in JIPM [11] are referred to in this paper. It is A) overall management indicator group, B) KPI group and C) KAI group. KPI that represents a result of improvement project is considered as A and B. And KAI that represents a process for achieving a purpose of improvement project is considered as C. Proposed evaluation system of factory performance in third section and a preliminary experimentation in forth section are tackled with followed by this classification.
doi:10.15807/jorsj.52.204 fatcat:xksleddk3vacfm6stgxvzsmt6y