4 Fleet performance KPIs that every shipping organisation should set today
Any organization seeking to improve efficiency and cost-effectiveness needs to have clear set ways of measuring success. This is especially true for marine vessel companies with large fleets who need to track and analyze an enormous amount of ship data. In order to understand your performance and identify areas for improvement, setting fleet key performance indicators (KPIs) is the key to real, accurate goal measurement.
KPIs are necessary for limiting the amount of useful data, they should not require any manual data input, and they should help align organizational goals such as with operational excellence models. Fleet managers might have trouble deciding which KPIs are the most important for managing fleet performance, so begin with these essential KPIs that every shipping organisation should set first.
1. Average length of time between failures
Measuring the length of time between unscheduled maintenance on your large vessels can give you an extremely clear benchmark for costs, and loss of time for ships out of commission for repairs. The average length of time between failures should be as high as possible, and if this KPI comes in surprisingly low, you may need to reassess how you handle servicing of your vessels and weigh the costs versus benefits of investing in new equipment versus continually servicing old equipment. Measuring this KPI can give you a clear indication of how reliable – or unreliable – your vessels are.
2. Unit costs
One clear way to understand your spend over time is to measure labor and material costs per vessel in your fleet. It may not be enough to monitor your spending on the fleet as a whole. By using individual unit costs as a measurement indicator, you can get a better picture of which vessels are most cost-effective, and which vessels are costing you the most to own and operate. If you still want to have an indication of spending per unit in relation to the entire fleet, you can also use the unit cost as a percentage of total cost as a KPI to understand the amount you’re investing into each vessel as a part of the fleet.
3. Vessel Utilization
This KPI can be quite surprising to some fleet managers, but it is especially crucial. Measuring the amount of time your vessel is in use, versus usable but not being used, versus in maintenance and repair, can help you to identify if your vessels are being underused or overused. If you find that the time a particular vessel is being used is less than the time spent unused or in repair, you may need to make scheduling, organizational, or servicing changes to optimize the time of use you get out of your individual ships.
4. Failure response time
One way that most marine vessel companies can improve their cost-effectiveness and reduce the time that vessels are in repair, is to measure the time it takes for failures on board to be identified, addressed, and solved. Most fleet managers need to improve response time, and often response time is crucial in reducing the impact of failures. By using failure response time as a standard KPI, you can identify needs for implementing new practice standards or technology to help you manage failure in the future.
Without setting KPIs, it can be difficult for fleet managers to have a perspective on the efficiency of their vessels. Costs for labor and materials can increase tremendously, maintenance periods can be too long, and the whole organization can run into problems with efficiency and reliability. Using ship automated data is a time efficient method for tracking your fleet and making changes that your whole organization. When you begin to analyze your data again benchmark KPIs, you can know precisely just where you need to make improvements for the future, and more importantly, make real changes based on data, not on perceptions.