Study Ties Profitability to Manufacturing Metrics

More of the manufacturers and producers who improved their profits significantly also use metrics consistently and align corporate objectives with operational metrics compared to their peers, according to a study by The Manufacturing Enterprise Solutions Association (MESA), announced in conjunction with its media partner IndustryWeek. The findings are available in White Paper #40 Performance Improvement andMetrics Practices.

Less than 40% of all respondents to this study saw predictive analytics as important or most critical, compared to over 85% who see actual values as important or most critical. This look back is beneficial in real time with the opportunity to predict or look forward on the horizon.

Averages, variance and trends are also considered important or most critical by over half of respondents. This research also indicates that while most manufacturers have undertaken performance improvement initiatives such as lean manufacturing, total quality management and six sigma, most are not consistent in using metrics. Fewer than two in five respondents report that their companies always use metrics to improve performance.

About 45% report that they sometimes do, but over 15% report that they do not often or never use metrics to improve performance. So these data-oriented initiatives may not deliver the intended benefits or are only used in a portion of the business, since metrics serve to focus the activities.

This group of respondents is primarily directors and managers, but 23% executives and 14% supervisors and staff also responded. Their satisfaction with the availability of metrics-to make sound decisions varies by scope of role. While no team leader is very significantly satisfied, over one third are significantly satisfied, bringing their level of significant/very significant satisfaction higher than senior executives and managers/project managers, who are close behind. Directors (25%) and staff (20%) are much less likely to be significantly or very significantly satisfied with available performance metrics needed for timely decisions.

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