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Intro: Welcome to the E6S-Methods podcast with Jacob and Aaron, your weekly dose of tips and tricks to achieve excellent performance in your business and career. Join us as we explore deeper into the practical worlds of Lean, Six Sigma, Project Management and Design Thinking. In this episode number 13 (Part 3 of 4), we reveal the path to choosing leading metrics for projects over the more common lagging business metrics. We illustrate two tools that can be used to scope down to more leading metrics for your projects. If you're just tuning in for the first time, find all our back episodes on our podcast table of contents at e6s-methods.com. If you like this episode, be sure to click the "like" link in the show notes. It's easy. Just tap our logo, click and you're done. Tap-click-done! Here we go. http://bit.ly/E6S-013RB Leave a Review! http://bit.ly/E6S-iTunes

I Leading vs. Lagging indicator metrics

a. Explain with examples Leading vs. Lagging

i. Most Business metrics are lagging indicators for what correlates to long-term success. Lagging means, behind the curve, cannot use to change directions very quickly.

1. On-time delivery

2. Customer Satisfaction

3. New Product Hit Rate

4. Repeat Sales

5. New Product % of Overall Sales

6. Net Promoter Score

7. First Pass Yield; Or Rolled-throughput Yield

8. Days Lost Time

9. Customer Returns/Credits

b. Drill down from common business metrics to "six sigma" metrics related. Six Sigma projects need to scope down closer to some leading indicators that are closer to the specific processes. Indicators where a fast course correction can be taken in order to preserve the higher level business metrics. Get closer to the inputs. Y=f(x). (Recommended Tools: Fishbone Diagram, Force Field Analysis)

i. % On-time Delivery – May be a function of yield or capacity constraints. (metrics not mutually exclusive) Y=f(x)

1. Turn-around Time or Throughput Time – The time it takes to produce 1 piece from order to delivery. (Not to be confused with Cycle Time, which is machine time only.)

2. % On-time Start

3. % Equipment Up-time

4. % In-process yields

5. Inventory Levels

6. Order Entry Error Rate

7. % Supplier Conformance (Logistics reliability, both incoming and outgoing)

ii. % First Pass Yield (or RTY) Y=f(x)

1. In-process Defect Rate (per unit)

2. Training effectiveness/Standard Work

3. % On-Time Preventative Maintenance

4. % Supplier Conformance (incoming quality)

5. Design Effectiveness

6. % Gauge R&R/ Measurement Systems

iii. Days Lost Time

1. Training Effectiveness/Standard Work

2. % Hazard Evaluation Rate

3. Job Hazard Risk Score

4. % On-Time Preventative Maintenance

Drill your project metrics down to the process level, (closer to the inputs), so as to measure leading indicators of success, rather than long-term lagging business indicators.

II *** Measure the right stuff***

III Recap Episode

Outro: Thanks for listening to episode 13 of the E6S-Methods Podcast. Stay tuned for episode number 14, (Part 4 of 4), where we wrap up our “Measure the Right Stuff” series with Project Goal Setting, the 70% Rule of Thumb. Don't forget to click "like" or "dislike" for this episode in the show notes. Tap-click-done! If you have a question, comment or advice, leave a note in the comments section or contact us directly. Feel free to email me "Aaron," aaron@e6s-methods.com, or on our website, we reply to all messages. If you heard something you like, then Clammr, and share it. Didn't like what you heard? Join our LinkedIn Group, and tell us why. Don't forget you can find notes and graphics for all shows and more at www.E6S-Methods.com. "Journey Through Success. If you're not climbing up, you're falling down." Leave a Review! http://bit.ly/E6S-iTunes

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