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The Perfect KPI

AACO knows that linen production management in a plant is a challenge.  What to produce in the limited time you have is a difficult decision.  Peter Drucker said, “what gets measured gets managed, what gets managed gets respected.”  So, what KPI (key performance indicator) should we measure? Is there such a thing as “the perfect” KPI in the laundry world?

Some say it is PPOH (pounds per operator hour).  Some say it is Profit per operator hour.  However, what works one week as a good KPI may not work the next week.  Especially if your staff works toward fulfilling the KPI and not fulfilling the customer’s needs.

For example, let’s say that a health care laundry plant is using PPOH (pounds per operator hour) as their KPI in which they award bonus pay.  Now let’s say that a manager’s shift is one hour from ending and s/he has to make a choice between sheets and blankets or running pillowcases and stacking wash cloths.   If the manager’s pay is based upon pounds, what items will the manager choose?  Easy prediction….sheets and blankets since they weigh more per piece.

But what if the customer is complaining that they are short on pillow cases and wash cloths?  The answer is still the same… if you are bonusing on PPOH the customer will be shorted the needed small items.

What’s the answer?  Some plants will use a combination of PPOH and item make up as a KPI.  The reality is that the workforce will work towards that KPI and eventually the KPI may have to change, based upon the needs of the final user/customer.  The answer may be that the KPI needs to change as the customers’ needs change and as the production workers processes evolve.

Do you have thoughts on this?  Please contact our team of experts to discuss and don’t forget to ask about American Associated Companies newest quality linen products and current value deals.

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