IAQG-KPI-Examples - Section 7.11.2 Metrics and KPI Definitions - Customer Metrics and Engineering and Product Development

Sep 13, 2026

Uploaded by Rowan

Section 7.11.2 defines key performance indicators used to measure delivery, quality, and engineering execution. It specifies calculation bases and exclusions for Customer Metrics such as Item Escape Rate (IER), Defects per Unit (DPU), concession-related measures, and on-time delivery, including transport-condition parameters. For Engineering and Product Development, it clarifies KPI intent and scope for Quality of Engineering Release, Engineering Escapes, and On Time Internal Engineering Release, emphasizing defined study boundaries and how planned versus actual release dates are compared.

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Key Performance Indicator (KPI)

Customer Metrics

Engineering and Product Development

| SCMH ([www.iaqg.org/scmh](www.iaqg.org/scmh)) Section 7.11.2 Metrics and KPI Definitions Rev: A Dated: 30 August 2018 | | | | | | --- | --- | --- | --- | --- | | Key Performance
Indicator (KPI) | KPI Description What the KPI Measures | | Indicator
Expressed in; | Remarks | | 1. Customer Metrics | | | | | | Item Escape Rate (IER) | Number of non-conforming items under company liability vs.. Number of items delivered by the company during the period. | Number of items delivered to the customer and subsequently identified by this customer as not compliant to the applicable definition or specfication. It excludes non conformities that are not under liability of the organization ([e.g. parts](e.g. parts) damaged by the customer during installation) . | Parts per million (PPM) or % | See SCMH section 5.1.2 . 'Delivery Metrics Definition Guidance' . | | Defects per Unit (DPU | Number of system defects, under company liability vs.. Number of systems delivered by the company during the period. | Number of sytem defects, anomalies or non-conformities detected on a delivered sytem or assembly by the customer to whom it was delivered. It excludes defects or non conformities that are not under liability of the organization (e.g. systems or assemblies damaged by the customer during installation, parts removed with no defect fault because of incorrect trouble shooting by the customer, etc. ) . | Unit per system or assembly | See SCMH section 5.1.2 . 'Delivery Metrics Definition Guidance' . | | Concession Rate (CR)
or Concession Number (CN) | Number of concessed items delivered vs.. Number of items delivered by the company during the period. | Number of items delivered by the organization to its customer covered by a concession accepted by the [customer vs. total](customer vs. total) Number of items delivered by the company to its customer during the period.
May also be the total number of items delivered by the organization to its customer covered by a concession accepted by the customer during the period. | PPM,% or Unit | See SCMH section 5.1.2 . 'Delivery Metrics Definition Guidance' . | | Concession per System (CPS) | Number of concessions raised on systems (or assemblies) vs. Number of systems or assemblies delivered by the company during the period. | Number of concessions accepted by the customer on systems (or assemblies) delivered by the organization divided by the number of systems (or assemblies) delivered by the organization to this customer during the period. | Unit | See SCMH section 5.1.2 . 'Delivery Metrics Definition Guidance' . | | On Time Delivery to Customer | On Time Delivery punctuality level of item | On Time Delivery (OTD): Number of Purchase Order lines/items delivered on time in the period by the company vs. Number of Purchase Order lines/items due in the period. | % | Note: Transportation is to be taken into account according to the PO clauses. That means: “Departure date” + “transportation duration” ≤ “Supplier Promised Date”. Parameters may vary from one customer to another (e.g. counting working days or calendar days, on time = -5 days/+2 days, or = -3 days, +0 day) .
See SCMH section 5.1.2 . 'Delivery Metrics Definition Guidance' . | | | s
deliveries (at the customer) | | | | | Customer Delivery Delay Average | Delay Average):
degree of performance related to the late delivered items (at the supplier) | Delay Average or Delivery Variance (DV): Cumulative number of days for all late deliveries in the period vs.number of late deliveries in the period. | Unit (days) | See SCMH section 5.1.2 . 'Delivery Metrics Definition Guidance' . | | 2. Engineering and Product Development | | | | | | Quality of Engineering
Release (Design Right First Time) | Reworks on engineering drawings, Number of published drawings which require a rework for correction. | Measures the corrections that are requested internally (by Design Engineering, Manufactu

FAQs

How are Item Escape Rate (IER) and Defects per Unit (DPU) calculated?

IER counts non-conforming items under company liability relative to items delivered during the period; DPU counts system defects under company liability relative to systems delivered. Both exclude non-conformities not under the organization’s liability.

What does On Time Delivery (OTD) require under the definition?

OTD uses the number of purchase order lines/items delivered on time divided by the number due in the period. “Departure date” plus transportation duration must be less than or equal to the supplier promised date, with counting parameters potentially varying by customer.

What is the purpose and scope emphasis of Engineering Escapes and Quality of Engineering Release?

Engineering Escapes measure missed execution against design requirements based on producer or customer identification of nonconformity causes tied to standard work or engineering design practices at the time. Quality of Engineering Release tracks reworks on engineering drawings after release when the design activity failed to prevent the error, with exclusions such as changes from new customer demand.

Sep 13, 2026

Uploaded by Rowan