Efficiency: The Mother of All KPIs – Breaking It Down Simply
1. Efficiency (Fundamental Formula) Efficiency = Output Input \text{Efficiency} = \frac{\text{Output}}{\text{Input}} This is the base formula, where "output" and "input" can be anything—energy, time, raw materials, or resources. 2. Productivity (Material-Based Efficiency) Productivity = Output Quantity Input Quantity (Material) \text{Productivity} = \frac{\text{Output Quantity}}{\text{Input Quantity (Material)}} Measures how much product is made from a given amount of raw material. Higher productivity means better utilization of raw materials. 3. Availability (Time-Based Efficiency) Availability = Actual Operating Time Total Scheduled Time \text{Availability} = \frac{\text{Actual Operating Time}}{\text{Total Scheduled Time}} Reflects how much time a machine or system is available for operation versus planned time. If a machine is down for maintenance, availability decreases. 4. Utilization (Machine Usage Efficiency) Utilization = Operating Time To...