“It’s impossible to manage what you can’t measure,” Anonymous
There is nothing like one metric rule in employee evaluation for manufacturing; instead, it is a combination of both quantitative and qualitative metrics. Most companies use a 360 or 180-degree feedback loop to assess employees for more accurate results.
Manufacturing companies use the evaluation results for their strategic short-term and long-term goals, as well as to gain clarity on their current standing. The metrics also provide them with substantial information that’s necessary for decision-making.
Performance metrics may differ from one industry to the next; however, there are some that remain constant. In this article, we outline eight common employee evaluation metrics for manufacturing companies.
- Customer satisfaction rate
Customers are the number one priority for any company – they are the most treasured asset. Without them, there’s no business. A happy client can serve as an ambassador because they will go around referring the company to people around their circles. Given their essential role in the sustainability of a business, it’s critical that they are fully satisfied with the services or products on offer.
Companies perform routine customer satisfaction surveys to measure the number of consumers who would rate their satisfaction levels as very satisfied. If more clients rate their experiences highly, then it’s an indication of excellent customer service – and the opposite is true. This metric is ideal for evaluating the customer support team, quality assurance team, production team and even the delivery team.
- Changeover time
Changeover is the process of changing a machine or line from running one product to another. Manufacturing companies can use this metric to gauge the amount of time or speed it takes to make the conversion. Depending on the efficiency of the employee and equipment, the process can last anywhere from a few minutes or hours, to even days.
Downtimes are never good for business, and if they last for days, then it can cost a company millions of money. It’s therefore critical for managers to track this metric for an insight of where and how they can improve the changeover times. For example, if the equipment is the issue, they can shift to using one that’s easy to install and configure. The effectiveness of an employee can be measured by how efficient the process runs when all systems are fully functional.
- Capacity utilization
This metric indicates the amount of manufacturing output that’s used at a given time. It highlights the overall slack that’s in a facility in percentage form. Therefore, a company that’s running at full capacity has 100% capacity utilization.
Managers can use the capacity utilization metric to check how well the department in charge is doing. There’s need for questioning if the parameter falls behind the expected percentage.
- Production or schedule attainment
This is a measure of how frequent the company achieves its production targets within specified times. The metric uses the percentage of scheduled production to indicate the actual output – low numbers may mean that the production team is unable to plan for practical challenges or that the machine is not optimized correctly.
- Produce defects
This is an incredible metric for assessing the production and quality assurance team – managers in manufacturing companies can calculate the number of products that have been produced incorrectly or with defects. When the number of defective products is high, then it is an indication of low work quality. They can also check for errors and corrections when performing employee evaluation for manufacturing.
- Planned maintenance percentage (PMP)
Companies use PMP to measure the maintenance staff. The metric indicates the number of hours utilized on scheduled maintenance activities over a specified duration and is often represented in percentage form. For instance, if the team used 375 hours on planned maintenance activities, out of 500 total hours on all maintenance, the planned maintenance percentage is 75%. Other employers prefer to use ratiometric rather than a percentage to show the frequency of planned maintenance versus the emergency or unplanned one – in this case, 2:1.
- The rate of absenteeism
Absenteeism and performance go hand in hand. According to some studies, employees who are highly engaged and motivated take fewer sick days, which is 37% less than those who aren’t. Besides, when employees consistently miss work, they lower the company’s productiveness, which often leads to lower organizational performance.
- Overtime per employee
Employees who are willing to work extra time are often motivated and are bound to deliver more, regarding work quantity. Employers can check how much effort each employee is putting towards the company by calculating their total hours of overtime.
Managers often combine the performance metrics with recruitment information to measure the employees who are highly likely to be top performers. They do this by matching the employee’s profile against their performance after one year of service. Patterns obtained can be used to influence the decision regarding the type of new candidates that they should hire.