The Integrated Approach: Why Individual Metrics Are Not Enough
Successful manufacturing companies rely on a systematic combination of team development, operational metrics, and continuous improvement. Not every metric is equally meaningful for every company— a controlling concept can only be successful if it meets the specific requirements of the individual operation.
Many managing directors in mechanical engineering face the challenge of selecting the right metrics from a wide range of options and meaningfully linking them with team development. The solution lies in an integrated approach that combines operational excellence with systemic organizational development.
Focus on a maximum of ten production KPIs that represent different business areas. According to recent studies, KPI systems with more than ten metrics quickly become confusing and lose their steering effectiveness.
Overall Equipment Effectiveness (OEE) is the fundamental metric. It is calculated from three components:
Practical Example: By systematically standardizing data collection and normalizing all production losses on a time basis, Thermo Fisher achieved a 17% OEE improvement in just 6 weeks.
Every team exists for an economic reason—therefore, team performance must be measurable. The combination of social and operational metrics shows whether team performance is actually improving.
Successful team development in manufacturing means:
Continuous Improvement (CIP/KVP) functions as a mindset focused on constant improvements in small steps. Instead of large, time-consuming projects, successful companies rely on many small, quickly implementable actions using the PDCA method (Plan-Do-Check-Act )
The key lies in systematic execution: CIP teams regularly analyze problems in their areas and develop concrete improvement proposals that can be implemented immediately.
Identify your individual controlling requirements through systematic analysis. Break down management’s strategic objectives into operational levels and define a maximum of three core KPIs per area.
Visualize the most important KPIs for your teams in clear dashboards. Modern cloud-based solutions enable even SMEs without their own IT infrastructure to enter fully integrated digital processes.
Establish annual audits of your CIP teams with clear problem analyses and improvement proposals. This systematic approach leads to continuous process improvements and increased productivity.
Combine team and process performance in structured reviews. Initial improvements can be measured after just a few weeks, as demonstrated by the Thermo Fisher example, since many small measures can be implemented quickly.
Centralized data storage reduces error rates by 40% to 75% and enables efficient collaboration. Automated workflows reduce data entry errors and shorten development times while improving product quality.
The willingness of top management to implement changes immediately is critical. CIP teams must be empowered to act directly and provided with the necessary resources for successful improvement projects.
Develop KPIs together with production managers. This participatory approach supports active use of the developed KPI systems.
CIP becomes an integral part of effective, active quality management. As part of the overall corporate culture, continuous improvement creates sustainable competitive advantages.
Studies show: that manufacturing companies with systematic performance management typically achieve an initial ROI in less than 12 months.
Continuous improvements lead to measurable cost reductions and productivity gains that amortize investments in a short period of time.
Start with 3–5 key KPIs and expand gradually. Companies should track no more than ten production KPIs to keep complexity manageable.
Initial improvements can be measured within just a few weeks, as shown by the Thermo Fisher example. Since many small measures can be implemented quickly, process performance improves continuously.
Costs vary depending on company size, but manufacturing companies with systematic performance management typically achieve an initial ROI in less than 12 months, justifying the investment.
Develop KPIs together with managers and communicate transparently the benefits improvements bring to daily work.
Cloud-based solutions enable entry even without an in-house IT infrastructure. A gradual implementation is more effective than a complete system overhaul.
[S] OptiProERP – The Importance of KPIs in Manufacturing: „The number of KPIs for a business should be around 10, since too many can become unmanageable and ineffective.“
[S] MasterControl – Manufacturing Excellence customers typically see initial return on investment (ROI) in less than 12 months
[S] Sci-Tech Today – Automation is directly linked to an error reduction rate spanning from 40% to 75% compared to traditional manual processes
[S] PTC – By standardizing data collection efforts and normalizing all production losses on the basis of time, Thermo Fisher saw a 17% OEE improvement in just 6 weeks
[S] OEE.com – OEE (Overall Equipment Effectiveness) is the gold standard for measuring manufacturing productivity
Copyright © 2025 Peter Littau
Copyright © 2025 Peter Littau
