Problem 12-15 (Algo) Internal Business Process Performance Measures [LO12-3] Tombro Industries is in the process of automating one of its plants and developing a flexible manufacturing system. The company is finding it necessary to make many changes in operating procedures. Progress has been slow, particularly in trying to develop new performance measures for the factory. In an effort to evaluate performance and determine where improvements can be made, management has gathered the following data relating to activities over the last four months: Quality control measures: Number of defects Number of warranty claims Number of customer complaints Material control measures: Purchase order lead time Scrap as a percent of total cost Machine performance measures: Machine downtime as a percentage of availability Use as a percentage of availability Setup time (hours) Delivery performance measures: Throughput time Manufacturing cycle efficiency (MCE) Delivery cycle time Percentage of on-time deliveries Month 2 3 4 189 167 128 92 50 43 34 31 106 100 83 62 8 days 7 days 5 days 4 days 2% 2% 3% 6% 5% 6% 6% 10% 94% 91% 88% 84% 8 10 11 12 ? ? 7 ? ? ? ? ? ? ? ? 95% 94% 91% 88% The president has read in industry journals that throughput time, MCE, and delivery cycle time are important measures of performance, but no one is sure how they are computed. You have been asked to assist the company, and you have gathered the following data relating to these measures: