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=Key Performance Metrics at Delft Solutions= | =Key Performance Metrics at Delft Solutions= | ||
Delft Solutions utilizes three fundamental metrics to measure and improve business performance: Effectiveness, Reliability, and Throughput. These metrics work in concert to provide a comprehensive view of operational excellence. | Delft Solutions utilizes three fundamental metrics to measure and improve business performance: Effectiveness, Reliability, and Throughput. These metrics work in concert to provide a comprehensive view of operational excellence, or how well we're doing as a team. Almost every decision we take is influenced directly or indirectly by their impact on the metrics. | ||
==Effectiveness== | ==Effectiveness== | ||
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* Lower TDD indicates higher reliability. The ultimate goal here too, is 0. | * Lower TDD indicates higher reliability. The ultimate goal here too, is 0. | ||
Throughput- | Throughput-Euro-Days are very similar to Inventory-Euro-Days, with two key differences being: | ||
1. the 'clock' on IED starts running from the moment you work on the project. TED starts from the expected delivery date or deadline of the project. | |||
2. IED will only go up as you work on the project. If you skip a day of work for a sick day, vacation, or just the weekend, IED will not go up. TED will always go up, every day, even if no work on the project is being done. | |||
* Incorporates both time and monetary value | * Incorporates both time and monetary value | ||
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Like almost all lean thinking, you can only deliver quality products. Badly engineered products or bad testing is so antithetical to lean thinking, that none of the metrics will work correctly if you start reducing quality. | Like almost all lean thinking, you can only deliver quality products. Badly engineered products or bad testing is so antithetical to lean thinking, that none of the metrics will work correctly if you start reducing quality. | ||
= Example = | |||
To illustrate the behaviour of metrics in various situations, we list a few examples: | |||
== Project == | |||
== Late delivery == | |||
We sign a new customer for a project that is expected to take 3 days of work and be billed at 1.000 € per day. The customer agrees with the fixed-price quote we give her. However, we think the project will take us 2 days, so we decide to start the work on day 2. | |||
It turns out we were wrong and the work actually takes us 4 days to deliver. The customer is slightly upset, but they added a little buffer for this possibility so they can still use the work. We send the invoice on day three and the customer pays the invoice on day five. | |||
{| class="wikitable" | |||
|+ The metrics behave as follows | |||
|- | |||
! Day !! Effectiveness !! Reliability !! Throughput | |||
|- | |||
| 1 || 0 || 0 || 0 | |||
|- | |||
|} | |||
== Cancellation == | |||
=Relationship Between Metrics= | =Relationship Between Metrics= | ||