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KPI’s on the Manufacturing Line – Painting a Complete Picture of Your Operation with an MES

When building a jigsaw puzzle, which pieces do you select first?

Do you randomly start sifting through the chaotic mounds of pieces, grabbing the ones that catch your eye and trying to fit every other piece in the pile to it (even if they clearly don’t fit)? Although this may seem like the only way to start, studying the puzzle’s image and deploying strategies such as grouping pieces by color or element within the photo can help eliminate all the unnecessary guesswork of trying to fit mismatched pieces together through developing ‘starting-blocks.’

Similar to building a jigsaw puzzle, uncovering the Hidden Factory within your organization can often be a struggle, as the number of ‘pieces’ of data collected in a manufacturing operation can exceed your typical hobby store puzzle… by a factor of 100,000. Analyzing your process, developing business rules to aggregate your data, and measuring KPI’s (Key Performance Indicators) are essential steps to painting a complete picture of your operation.

Analyzing Your Operation – Capturing Actionable Data

One of the most important aspects of achieving data driven insights is properly selecting and configuring an MES (Manufacturing Execution System) solution to suit your operation’s specific needs. To drive change and analyze KPI’s, you first need a representative dataset to work with. Whether you already have an MES system or are interested in installing one, brainstorming key areas of focus will allow for strategic capturing of data that is reflective of your process. It’s not just about capturing data; it’s capturing actionable data.

It’s often helpful to think of an MES as a physical camera at every station on a manufacturing line. This camera will record what happened at the station, how long an event took, and who was present. You can’t set the camera up too close to the station as you may miss some important events that are outside the field of view. On the other hand, you can’t set the camera too far away and risk losing focus on the finer details. The camera must be positioned just right to capture an accurate representation of what’s occurring.

With that in mind, some fundamental questions to consider for capturing the most effective data are:

  • Which operators are logged into a station, and did they arrive on time?
  • When did a product arrive in an operator’s station?
  • When did they start to work on that product?
  • Of all the specific process steps at each station, how long did each take?
  • Were any defects logged related to that product? Were those defects resolved and by who?
  • Did any operators need materials and what were they? How long did they wait to get them?
  • When were products completed?
  • Did the station go over cycle? If so, what was the reason, and how many times did that happen?

Ideally, an MES should address the questions above to accurately reflect your operation and drive a repeatable process. It is important to remember that not all MES systems are built equally and can vary according to industry and operation. To further help narrow down your operation’s MES requirements, PINpoint has devised an in-depth analysis of the MES needs of different Discrete Manufacturing Operations.

Selecting Quantifiable and Insightful KPI’s

Once you have access to a comprehensive dataset, KPI’s help drive a process of continuous improvement by targeting specific data captured on the line. Regardless of the nuances of each manufacturing operation, the methodology behind achieving actionable insights from your data remains the same. Productivity, process capability, value-added time, operator performance, and quality are five of the primary areas of KPI’s used to drive improvement.


Productivity KPI’s describe your day-to-day production. Were you above or below your targets? How do production levels vary across lines, stations, operators, and dates? Were there any anomalies? Productivity KPI’s should be the highest level of analysis and provide a ‘roadmap’ for more detailed findings.

  • Performance – Line/Station Actuals vs. Targets
  • OEE (Overall Equipment Effectiveness) How well a manufacturing operation (equipment, time, materials) is used during production


Process Capability

Process Capability is the measure of how much a process can uniformly produce given the constraints on the line and production. Measuring process capability is where an MES really shines, as an effective MES will capture the exact cycle time required across for every line, station, product, operator, and process step. Quantifying how long different processes take not only helps you plan for production, but also identifies opportunities for improvement and growth on the line.

  • Cycle Time The amount of time spent working on the product
  • Process Variability The amount of variation in cycle time for a process step/product
  • Over-Cycle Time The amount of time past the desired cycle time target
  • TAKT Time The ratio of production time to target number of units to build 


Value-Added Time

One of the gold standards in manufacturing spaces is the concept of Lean Six Sigma. Lean manufacturing seeks to quantify and eliminate wastes on the line to further production. According to the principles of Lean, there are two types of time in manufacturing: value-added and non-value added. Value-added time is the amount of time that directly contributes to creating the product. All other operations (transportation, waiting, over-processing) are considered wasted non-value-added time. Through identifying which factors drive value-added time/non-value-added time, can an operation maximize their value-added time and further production. Sadly, despite the huge benefit of being able to quantify and monitor value-added time, many manufacturers (even those with MES solutions) often cannot quantify this metric properly.

  • Value-Added Ratio A ratio of time spent working on products to the total time in production
  • Time-Buckets PINpoint’s proprietary 5-Bucket Model categorizes production time into distinct groups to target where waste is occurring on the line


Operator Performance

An operation is only as good as the people working within it. Regardless of all the process engineering performed on a line, understanding and optimizing the effectiveness of your operators is a critical step. Besides quantifying metrics such as cycle-time at an operator level, management should seek to understand operator behaviours such as: When do operators come back from breaks? Are they always at their station? Do they struggle with certain process steps/require additional training? What motivates operators, does seeing how well they perform increase production?

  • Shift Adherence The ratio of time spent logged in vs. total production time
  • Late Logins The amount of time spent logged out during production



Quality can often make or break an operation. If a product isn’t built right the first time, or worse, is defective and sent to the customer, this can have major time and financial implications. Implementing strategic check/verification steps within an operation will help reduce quality errors. However, if implemented ineffectively, they can use up valuable working-time for a meaningless scan operation. Metrics such as step bypasses and defect reasons highlight areas where quality issues occur most on the line and why.

  • Bypasses Steps that have been ignored intentionally for a product
  • Defects Manufacturing errors that reduce the quality/functionality of the product


Applying Insights to Drive Change

The last step to enacting change is determining how you will interpret your KPI’s and the significance you will assign to them – this is achieved through applying your business rules against your KPI’s. When first looking at your selected KPI’s it’s important to ask: “what am I trying to achieve with my operation?” Having a goal in mind, whether it be to increase production, reduce defects, or alter the flow of your line, is key to selecting which metrics are meaningful to you.

Interpreting your data and driving change is the most difficult step of all, and for a good reasontechnology alone isn’t the answer. Industry expertise, a rich data set, KPI’s, and a realistic action plan are all required to generate actionable insights. This is where PINpoint really outshines other MES providers: we know that effective change is only possible through pulling the people, process, and technology levers in your organization. PINpoint isn’t just an MES company, our dedicated services experts are veterans in the discrete manufacturing space and have developed a proven methodology, The PINpoint Way, to drive improvements in as little as 90 days. Our services team will partner with you to gain a first-hand understanding of your operation and apply the PINpoint Way and our industry knowledge to uncover insights and start you down the path of continuous improvement.

Looking to start driving change through KPI’s? Explore both our MES solutions and targeted PASS Reviews to uncover KPI’s within your operation and take critical steps towards improving production.

4 Big Benefits of an MES Solution
for discrete manufacturing