ABSTRACT
Metrics should, first and foremost, encourage desired behavior. Metrics for cells need to focus on reducing time, space, and defects. Human beings adjust behavior based on the metrics they’re held against. Anything measure will impel a person to optimize his score on that metric. Utilization shows the percentage of time that a resource is utilized. For example, the most commonly used calculation of utilization divides run hours by available hours. Efficiency, also a local measure, evaluates how a resource performs against an arbitrary standard. The most common efficiency measure is labor efficiency, although efficiency measures are often used for both machines and people. Labor efficiency is based on standard hours divided by actual hours. The gross profit margin appears to be exactly the same. Overall Equipment Effectiveness has received a lot of press, being hyped as the granddaddy of all metrics for operations managers.
