SCMH Section 7.11.

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Revision Letter: B
Revision Date: 19JUNE2020
iaqg.org/tools/scmh Section 7.11

Plan and Manage Key Performance Indicators (KPI) - Detailed

Definitions

Introduction and Defined KPIs for Plan and Manage:

IAQG standards AS/EN/JISQ/SJAC 9100, 9110 and 9120 require every organization to
continuously improve their performances and determine actions to ensure these performances
are in line with targets defined by internal and external stakeholders.

IAQG Product and Supply Chain Improvement Strategy Stream has identified a list of most
commonly used Key Performance Indicators (KPIs) covering the main domains of the supply
chain (‘Customer metrics’, ‘Engineering and Product Development’, ‘Program Management’,
‘Manufacturing and Production’, ‘Supplier Management’, and ‘In Service – feedback from
operations’).

Use of these KPIs should support harmonization and reduction of customization of these KPIs
between the entity establishing them and its different internal and external customers.

SCMH Section 7.11.2 contains a list of KPIs, although not exhaustive, the KPIs listed in this
guidance document relate to the Supply Chain domain of Plan and Manage. Additional KPIs
from the 7.11.2 matrix will be added to this document as they are completed by the SCMH KPI
Detailed Definitions project team.

This section provides more details on how the Plan and Manage KPIs are established and
gives some examples for their use. The IAQG will continue to pursue this activity and the
SCMH will be updated as the work progresses.

Some of the KPI(s) described in this section are used to directly measure the result or the
performance of an activity, while some others are designed to analyze data (e.g. Pareto
analysis), evaluate the robustness of a process and determine necessary actions.

Depending on their nature, their level of granularity and the customer requirements, these
KPI(s):
- may be systematically provided to the customer (e.g. monthly or quarterly),
- may be monitored by the organization to manage its business and be provided to the
customer on specific request only (e.g. in case of performance degradation, in the
frame of continuous improvement or development project, during audits or
assessments, etc.)
- or may remain internal (never disclosed externally)

Each KPI is listed on a single page and provides the following information: KPI Name; KPI
Abbreviation; KPI Description; KPI Formula; KPI Unit of measure; Detailed explanations

KPIs defined to date for Plan and Manage:

Adherence to Program Gates

Program Non-Recurring Costs Adherence
Program Recurring Costs Adherence

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© 2020 IAQG The IAQG is a legally incorporated international not for profit association (INPA) with membership from the Americas, Europe and the Asia Pacific Region (Rev. 08-2015)
 SCMH Section 7.11.3
Revision Letter: B
Revision Date: 19JUNE2020
iaqg.org/tools/scmh Section 7.11

Plan and Manage Key Performance Indicators (KPI) - Detailed

Definitions

KPI Name Adherence to Program Gates

KPI
APG
Abbreviation

KPI Adherence to Program Gates (APG) measures the number of program gates
Description successfully passed on time as planned.

Number of gates successfully passed on – time

KPI Formula APG = x 100%
Number of gates due to have been passed per plan

KPI Unit of
Percent (%)
measure

What the KPI

Measure the number of program milestones successfully passed on time.
Measures

Gates: A decision point at the end of each phase of the Program Management
Plan.

Program gates are usually passed based on the approval of senior management
to pass the gate as the outcome of a successful gate review. The gate review itself
will adhere to a protocol and will have attendant metrics that must meet pre-
established levels.
Detailed
explanations Example: Engineering Change Introduction: Multiple milestones are needed to
be met in order to roll up a change.
Gate 1. Engineering Release – Pass on time
Gate 2. Industrialization – Pass on time
Gate 3. Logistics to determine part lead-times - Late
Gate 4. Programs decided cut in date based on milestones – Pass on time

APG = 3 / 4 x 100 = 75 %

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© 2020 IAQG The IAQG is a legally incorporated international not for profit association (INPA) with membership from the Americas, Europe and the Asia Pacific Region (Rev. 08-2015)
 SCMH Section 7.11.3
Revision Letter: B
Revision Date: 19JUNE2020
iaqg.org/tools/scmh Section 7.11

Plan and Manage Key Performance Indicators (KPI) - Detailed

Definitions

KPI Name Program Non-Recurring Costs Adherence

KPI ΔPNRCA
Abbreviation

KPI It is a measure of adjustment of actual program non-recurring costs versus

Description program target non-recurring costs.

PNRCAact
ΔPNRCA = x 100%
PNRCAtarg

KPI Formula PNRCAact – actual program non-recurring costs for the certain period of time
PNRCAtarg – planned or target program non-recurring costs for the certain period
of time

KPI Unit of Percent (%)

measure

What the KPI Measure the Non-Recurring Costs vs. program target.
Measures This is generally measured at some specific program milestones.

Δ - difference between the current status and the previous status.

Non-recurring costs (NRC) are fixed, non-repetitive, even though the total
expenditure may be cumulative over a period of time.

Examples of NRC: salary of the program managers, investment costs, leases,

real property taxes, insurance, etc.

Program costs: sum of non-recurring and recurring program costs

Note:
1. This kind of KPI remains internal.
Detailed 2. PNRCA may be done at the end of the programme or at specific
explanations program milestones to regularly analyse costs change (deviation)

Example 1: Program A/C XYZ, step 2.

Target Actual
Non-recurring costs 1 000K 1 200K

ΔPNRCA = 1200 / 1000 x 100% = 120% (or +20%)

Example 2: Program A/C XYZ, step 2.

Target Actual
Non-recurring costs 900K 700K

ΔPNRCA = 700 / 900 x 100 %= 78% (or -22%)

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© 2020 IAQG The IAQG is a legally incorporated international not for profit association (INPA) with membership from the Americas, Europe and the Asia Pacific Region (Rev. 08-2015)
 SCMH Section 7.11.3
Revision Letter: B
Revision Date: 19JUNE2020
iaqg.org/tools/scmh Section 7.11

Plan and Manage Key Performance Indicators (KPI) - Detailed

Definitions

KPI Name Program Recurring Costs Adherence

KPI ΔPRCA
Abbreviation

KPI It is a measure of adjustment of actual program recurring costs versus program

Description target recurring costs.

PRCAact
ΔPRCA = x 100%
PRCAtarg

KPI Formula PRCAact – actual program recurring costs for the certain period of time
PRCAtarg – planned or target program recurring costs for the certain period of
time

KPI Unit of Percent (%)

measure

Measure the Recurring Costs vs. program target.

What the KPI This may be done at the end of a program or at specific program milestones to
Measures regularly verify Recurring costs evolution versus time.

Δ - difference between the current status and the previous status.

Recurring costs (RC) are variable costs, which occur regularly and may be
changed due to many factors within the program life cycle.

Examples of RC: wages of the operators, raw material, seasonable costs (gas,
electricity), transport expenses, etc.

Program costs: sum of non-recurring and recurring program costs

Note:
1. This kind of KPI remains internal.
Detailed 2. PRCA may be done at the end of the program or at specific programme
explanations milestones to regularly analyse costs change (deviation)

Example 1: Program A/C XYZ, step 2.

Target Actual
Recurring costs 1 200K 1 000K

ΔPRCA = 1000 / 1200 x 100% = 83% (or -17%)

Example 2: Program A/C XYZ, step 2.

Target Actual
Recurring costs 1 700K 2 000K

ΔPRCA = 2000 / 1700 x 100% = 118% (or +18%)

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© 2020 IAQG The IAQG is a legally incorporated international not for profit association (INPA) with membership from the Americas, Europe and the Asia Pacific Region (Rev. 08-2015)