Measuring maintenance performance: a holistic approach

TLDR

Performance measures must link to strategy, with value‑based metrics assessing future organizational value, the Balanced Scorecard translating strategy into operational measures, system audits evaluating culture, and Data Envelopment Analysis benchmarking maintenance efficiency against peers. The paper examines the pitfalls of indiscriminate use of common maintenance performance indicators, reviews four measurement approaches, and proposes a research agenda to facilitate BSC adoption. The authors propose a research agenda to smooth the adoption of the Balanced Scorecard approach to managing maintenance operations. The BSC‑based approach best aligns with the design principles of an effective performance measurement system.

Abstract

Performance measures should be linked to an organization’s strategy in order to provide useful information for making effective decisions and shaping desirable employee behaviour. The pitfalls relating to the indiscriminate use of common maintenance performance indicators are discussed in this paper. It also reviews four approaches to maintenance performance measures. The value‐based performance measure evaluates the impact of maintenance activities on the future value of the organization. The Balanced Scorecard (BSC) provides a framework for translating strategy into operational measures that collectively capture the critical requirements for sustaining the organization’s success. System audits are the tool for measuring organizational culture, which in turn determines the appropriate approach to the organization of maintenance functions. The operational efficiency of an organization’s maintenance function can be benchmarked with those of its counterparts in other organizations by using Data Envelopment Analysis (DEA). Among these approaches, the one which builds on the BSC embraces the design principles of a good performance measurement system. To smooth the adoption of the BSC approach to managing maintenance operations, a related research agenda is proposed in the concluding section.