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Essential Operations Management Metrics
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First Pass Yield (FPY)
Measures the percentage of products that are manufactured correctly and without scrap the first time through the production process. Important for quality control.
On-time Delivery (OTD)
Measures the rate at which products or services are delivered to the customer at the promised time. Important for customer trust and satisfaction.
Lead Conversion Rate
Measures the effectiveness of sales efforts by indicating the percentage of leads that convert into customers. Important for gauging marketing and sales success.
Order Fulfillment Cycle Time
Measures the average time taken from receiving an order to delivering the product to the customer. Important for customer satisfaction and supply chain efficiency.
Capacity Utilization
Indicates the percentage of the total potential output that is actually being produced. Important for assessing how well resources are being used.
Inventory Turnover
Measures how often a company's inventory is sold and replaced over a period. Important for understanding stock efficiency and optimizing inventory levels.
Net Profit Margin
Measures how much net income is generated as a percentage of revenues. Important for understanding overall profitability and financial health of the business.
Employee Turnover Rate
Indicates the rate at which employees leave a company. Important for understanding workforce stability and the cost implications of hiring and training.
Gross Margin
Reflects the financial health by indicating the percentage of revenue that exceeds the cost of goods sold (COGS). Important for evaluating a company's financial viability.
Cycle Time
Measures the time it takes to complete one production cycle from start to finish. Important for identifying process efficiency and setting benchmarks.
Return on Assets (ROA)
Indicates how profitable a company is relative to its total assets. Important for assessing the efficiency in using assets to generate earnings.
Customer Satisfaction Score (CSAT)
A metric that assesses how satisfied customers are with a company's products or services. Important for customer retention and loyalty.
Defect Rate
Measures the frequency of defects in the production process. Important for quality management and reduction of waste.
Days Sales Outstanding (DSO)
Measures the average number of days it takes a company to collect payment after a sale has been made. Important for analyzing cash flow and accounts receivable performance.
Return on Investment (ROI)
Measures the gain or loss generated on an investment relative to the amount of money invested. Important for evaluating the efficiency of an investment.
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