Four specific activities are necessary when converting from one measurement system to another.

1. Changes must not only be published, but also communicated openly and discussed with all those who are involved or impacted by the changes.

2. Training is vital for people to feel comfortable with the new pro­cess and to alleviate the anxiety of not having the skill or knowl­edge to succeed in the new environment.

3. If people are to remain motivated during the change process, re­wards should be given in return for services or accomplishments. These can be in forms other than monetary, such as additional responsibility, promotion, public recognition, or simply a letter from top management. The key is to have a reward system that includes various types and that contributes to the success of the overall process.

4. Benchmarking helps raise people's awareness of best practices, and helps organizations measure from an "as is" position to a "should be" position. It allows them to see that others have succeeded while going down the same path and proves that what seems to be impos­sible is possible.

SPECIFIC MEASUREMENTS TO ACHIEVE WORLD-CLASS GOALSNew ways of doing business require new performance measurements. The following are but a few of the measures being used by world-class organizations to foster continuous improvement and achieve strategic goals.

Quality

defects per million
cost of quality (prevention, appraisal, internal and external failures)
supplier certification or certified items
reduction of supplier base
hours of employee quality training
hours of preventive maintenance
mean time between failure
certification of internal operations
unscheduled machine downtime
number of customer complaints, warranty claims, and recalls
unscheduled service call
percentage of lots rejected in error.

Cost

reduction in data transactions
materials shipped to point of use by supplier
dollars of product output per employee
throughput times from supplier to customer
budgeting expense trends
projects operating within budget.

Flexibility

reduction in cycle time
reduction in setup time
reduction in lot/batch size
increase in standard materials used per product
number of parts and levels in bills of material
degree of cross-training of production personnel.

Reliability

• increase in overall equipment effectiveness
• reduction in warranty costs
• reduction in engineering changes.

People Productivity and Development

sales per person
value added per person
employee turnover ratios
number of employees participating in improvement teams
competitive compensation packages
accident rates
absentee rates
training hours per employee
employee grievances
workdays lost due to accidents
percentage of appraisals completed on time
percentage of positions filled from within the organization
• percentage of employees with personal development plans
• number of recognition events and awards.

Inventory
inventory turnover by product and group
inventory days on hand
inventory record accuracy
items above/below target limits
physical inventory variances
number of adjustments to inventory records.

To Be Continued