Measureables: Efficiency - Effectiveness of COP (Customer Oriented Process) and KSP

L

lday38

#1
I have been using the turtle approach to document the inputs , and output ,etc.. and measurables of my processes. On the process Qoute and Contract Review , I cant figure out what type of measure of efficency and effectivenss. Can anyone tell me if they have such a process measurable?
 
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M

M Greenaway

#2
What about....

Quote turnaround time.

Orders won/lost to quotes given.

Order posting time.

Number of re-quotes or order changes.
 
R

Randy Stewart

#3
Also look at the old amendments to contracts for engineering changes, it may also open a door for change management measurables.
 

Cari Spears

Super Moderator
Staff member
Super Moderator
#4
Efficiency - Customer wanted when, we submitted when.

Effectiveness - We generate a hit/miss ratio - how many quotes turn into contracts. We also review our Job End Report, this tells us how much of a profit was estimated compared to the actual profit.

This works for us because we don't run production parts - we make, remake or repair machine details. Each job is different than every other job, we have 4 full time estimators and they each submit dozens of quotes a week. Our plant managers also do a bit of the estimating to some of our house accounts. This is a big issue for us as estimating is a large overhead expense.
 
Last edited:
#5
Cari Spears said:
Efficiency - Customer wanted when, we submitted when.

Effectiveness - We generate a hit/miss ratio - how many quotes turn into contracts. We also review our Job End Report, this tells us how much of a profit was estimated compared to the actual profit.
Good point Cari. Most folks probably wouldn't have looked at that. These numbers, coupled with why the numbers are, can have a tremendous role in organizational change. :agree:
 
P

p_tww

#7
?????Confused??
My understanding is
Effectiveness is to reach your planned result. For order review, that could be 100% on time delivery etc.
efficiency is how many resource you put to reach the planned result. for order review, it could be review cycle time etc.
 

Cari Spears

Super Moderator
Staff member
Super Moderator
#8
p_tww said:
?????Confused??
My understanding is
Effectiveness is to reach your planned result. For order review, that could be 100% on time delivery etc.
efficiency is how many resource you put to reach the planned result. for order review, it could be review cycle time etc.
You've got it.

We determine the effectiveness of our quoting process by the hit/miss ratio. Our first planned result in quoting a job is to be awarded the contract. We investigate, usually through the Sales Reps, missed quotes in order to determine why we were not awarded the contract. Was it price, delivery, did we not submit the quote in time (we do alot of rush repair work, if their part is here, their machine is down), etc. Then we review this information with the estimators and the management team in order to determine ways we can improve the hit/miss ratio.

Our next planned result is to make some money on the job we've been awarded. The measure of effectiveness is our job end report. The estimator estimates how much material, outside processing, purchased items, tooling, manhours, etc. will cost. Our job end report tells us the estimated profit, it details the expenses, and shows the actual profit. Again, this information is reviewed with the estimators and the management team.

We measure the efficiency of our contract review / quoting process by tracking whether we submitted the quote on or before the requested date. Due to the nature of our products, we cannot just say "all quotes must be submitted in X number of days". All RFQ's are logged in by the front office anyway, and the day the quote was submitted is entered by the same function, so we just added a column on her log for the quote due date as requested by the customer and we investigate the cause of quotes submitted later that that date. It is worth noting here, that the efficiency of our quoting process directly contributes to the effectiveness.

If you can offer some information about your company like - how many employees? do you run production quantities or low volume / short runs? are you manufacturing or distributing? etc. - then we can talk about what measurables would work for your organization.
:)
 
P

p_tww

#9
Hi, Cari

thanks for your input.
It's just a discussion. I thought the measure for efficiency on your contract review process was for effectiveness.
what' s the purpose on contract review/quoating process? if you satisfied the customer required date, it means you achieve your planned results. But for that decision, how long will you make decision?how many people you needed and how much you needed? that would be for efficiency.
 
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