KPIs

KPIs, short for Key Performance Indicators, are defined, measurable metrics used to evaluate how effectively an organization, process, team, or system is achieving specified objectives. In industrial and manufacturing environments, KPIs commonly focus on safety, quality, delivery, cost, and compliance.

What KPIs include

In regulated and manufacturing contexts, KPIs typically:

• Align to clear objectives, such as reducing unplanned downtime or improving first-pass yield.
• Have a defined calculation method, data source, and measurement frequency.
• Are traceable to operational data from MES, ERP, historians, quality systems, or OT equipment.
• Are monitored over time to identify trends, deviations, or the impact of process changes.

Examples of common manufacturing KPIs include:

• OEE (Overall Equipment Effectiveness): Combines availability, performance, and quality metrics, often based on standardized time categories such as those defined in ISO 22400.
• First-pass yield / right-first-time: Percentage of product that meets specifications without rework.
• On-time delivery: Proportion of orders or batches completed by the agreed date and time.
• Scrap rate: Portion of material or units that must be discarded.
• CAPA closure time: Time required to close corrective and preventive actions in quality systems.

Operational use of KPIs

In daily operations, KPIs are used to:

• Track performance of equipment, lines, work centers, and plants against targets.
• Support shift reviews, tier meetings, and management reporting.
• Provide objective input for continuous improvement, root cause analysis, and risk assessments.
• Align OT and IT data (for example, mapping machine states to standardized time categories) so calculations are consistent across sites.

Standards such as ISA-95 and ISO 22400 are often referenced to structure and name KPIs in a consistent way, for example by defining standard time categories that feed into KPIs like OEE and availability.

What KPIs are not

• They are not raw data points without context; a KPI has a specific purpose, definition, and target.
• They are not automatically comparable across sites unless definitions, data sources, and time categories are harmonized.
• They are not the same as alerts or alarms, although KPIs may be used to trigger alerts when thresholds are exceeded.

Common confusion

• KPI vs. metric: All KPIs are metrics, but not all metrics are KPIs. A KPI is a metric that has been designated as critical for tracking performance against a stated objective.
• KPI vs. OEE: OEE is a specific KPI (or family of KPIs) describing equipment effectiveness. KPIs is the broader category that includes OEE and many other indicators.

Link to ISO 22400 and time categories

In the context of ISO 22400, KPIs that measure equipment or line performance (such as OEE, availability, and utilization) are calculated from standardized equipment time categories. Examples include operation time, standby time, non-scheduled time, and unplanned downtime. Plants typically configure how machine states and events map into these categories to keep KPI calculations consistent and auditable across systems and locations.