It is actually extremely tough to determine manufacturing performance. Dimensions employed to measure manufacturing performance are quality, delivery, flexibility and cost performance.
Quality is a multifaceted term and it can be looked at from various viewpoints like characteristics, serviceability, aesthetics, reliability, conformance, performance, durability and perceived quality. However for manufacturing the conformance dimension is most important because it indicates the process’ capability to produce goods to their predetermined specification reliably and consistently. Internal measures of quality performance consist of percentage of goods that pass final inspection, scrap rate, etc. Client satisfaction is usually viewed as the top measure of external quality performance. Higher levels of conformance quality should be achieved before attempting to improve any other performance dimension.
It has two major dimensions: delivery reliability and delivery speed. Delivery reliability is usually known as dependability or on-time delivery and concerns the ability to deliver according to a plan. Delivery speed is related to the delivery cycle length. In fact the long-term success of a company demands that promises of speedy deliveries be kept with a high level of reliability.
Flexibility is a multidimensional concept and has many dimensions like volume, variety, process, delivery-time and material handling flexibility. Probably the most significant dimensions are the capability to alter production volume and the ability to modify products. A quality which separates flexibility from other dimensions of performance is that it is a way of measuring potential instead of actual performance. Therefore, flexibility can be termed as an enabler, enabling the manufacturing system to offer shorter delivery lead times and wider product range.
Cost is an absolute term and measures the amount of resources used to produce the product. Slack and Lewis (2002) stress thatall producers, even those whose primary source of competitiveness is different from product selling price, will be interested in keeping their costs low. Every dollar removed from the operation’s overall cost is a dollar added to the bottom line profits. Therefore cost performance is the most important of the different operational performance dimensions.