What Are the Most Important Manufacturing KPIs? 

What Are the Most Important Manufacturing KPIs? 

By Marta Teneva

November 30, 2023

In the competitive landscape of modern manufacturing, executives understand that simply maintaining efficiency isn’t enough—it’s about mastering it to achieve industry leadership.  

Decision intelligence requires a sophisticated understanding of performance metrics that go beyond the surface. Manufacturing KPIs (Key Performance Indicators) provide the foundation for these insights. 

However, with a plethora of metrics at hand, distinguishing which KPIs are truly transformative can set industry leaders apart. 

To help you with that, here’s a list of 10 KPIs every manufacturing executive should prioritize to drive operational excellence and strategic growth.  

Top 10 Manufacturing KPIs 

1. Overall Equipment Effectiveness (OEE) 

Definition: Overall Equipment Effectiveness (OEE) measures the efficiency and effectiveness of a machine or set of machines. It is a composite metric of availability, performance, and quality of machines during production. 


Overall Equipment Effectiveness

2. First Pass Yield (FPY)  

Definition: First Pass Yield determines the percentage of products produced that meet quality and compliance standards without rework. 


first pass yield

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3. Cycle Time 

Definition: Cycle time is the time required to complete one cycle of an operation or produce one unit from start to finish. 


cycle time

4. Scrap Rate

Definition: Scrap rate represents the percentage of materials discarded during or after the manufacturing process due to defects or excess. 


Scrap Rate KPI

Discover more: How to Choose the Right Manufacturing Analytics Solution? 

5. Inventory Turnover 

Definition: Inventory turnover indicates how many times a company’s inventory is sold and replaced over a specific period. 


inventory turnover

Learn from the best: Data-Driven Giants: How Big Players Optimize with Manufacturing Analytics 

6. Machine Downtime Rate 

Definition: Machine downtime rate captures the percentage of total time a machine is unavailable or non-functional, affecting production efficiency. 


Machine downtime Rate

7. On-time Delivery Rate 

Definition: On-time delivery rate evaluates the percentage of orders or shipments delivered to customers on or before the promised date. 


On-time delivery rate KPI

8. Capacity Utilization Rate 

Definition: Capacity utilization rate shows how much of the manufacturing operation’s total capacity is being used at a given time.


Capacity utilization rate KPI

9. Return on Assets (ROA) 

Definition: Return on Assets (ROA) measures how effectively a company’s assets are being used to generate profit.


return on assets KPI

10. Production Cost Per Unit 

Definition: Cost per unit indicates the total cost to produce one product unit, considering materials, labor, overhead, and other related expenses.


production cost per unit KPI

Keep Exploring: 5 Global Manufacturing Analytics Trends 

Manufacturing KPIs FAQs 

Track the Right Manufacturing KPIs with B EYE 

Navigating the world of manufacturing KPIs is both an art and a science. Since 2012, B EYE has been a trusted partner of Global Fortune 500 companies, bringing tangible results to the table. Our expertly crafted dashboards, utilized by over 5,000 employees worldwide, streamline operations and save over 30,000 hours of manual labor every year. Recognized as one of the “1000 Fastest Growing Companies in Europe” by the Financial Times in 2020, our track record speaks for itself. Let us empower your manufacturing processes with the right KPIs to drive unparalleled growth and efficiency. 

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