KPIs can feel like a buzzword—every manufacturer knows they should be tracking them, but few feel confident about where to start or what actually matters. In this episode of Buy the Numbers, Mike Payne sits down once again with Jon Hughes of CLA to unpack the real purpose of KPIs, why they're so misunderstood, and how data-driven decision-making can completely change the way a shop performs.

Mike and Jon dive into the QDISC framework—Quality, Delivery, Inventory, Safety, and Cost—and explore how these five buckets give manufacturers a clear, stable foundation for visibility. But they don't stop at what to track. They go deeper into how to understand the story behind the metrics, how to trend progress over time, and how to set targets that actually mean something for your business and your customers.

Whether it's measuring scrap and rework, calculating utilization, tightening cost control, or maintaining high on-time delivery, the two leaders discuss how the right KPIs help owners move from reactive firefighting to proactive leadership. They also break down the softer side of metrics: employee engagement, customer satisfaction, and the "why" behind the numbers that every team member needs to understand.

Most importantly, Mike and Jon show that KPIs don't have to be complicated. In fact, the power comes from keeping them simple, actionable, relevant, and directly tied to your goals. If you're ready to elevate your operation by measuring what actually matters, this episode gives you the roadmap to get there.

You will want to hear this episode if you are interested in...

• (1:16) Introducing Jon Hughes and why KPIs matter
• (2:34) Why business owners struggle to start tracking KPIs
• (3:51) Learn how to grow your top and bottom line with CLA
• (5:46) How data reduces pressure and improves decision-making
• (7:41) KPIs as a living system that changes with your business
• (8:57) The QDISC framework: Quality, Delivery, Inventory, Safety, Cost
• (10:47) Safety metrics and examples of what to measure
• (12:15) Quality metrics: scrap, rework, escapes, and root-cause analysis
• (14:51) How to set meaningful KPI targets and benchmark well
• (16:55) Benchmarking challenges and looking at your own historical data
• (18:09) Trending metrics using percentages versus absolute values
• (19:44) Using yield and scrap data to price jobs correctly
• (22:48) Delivery and inventory KPIs, including OTD and cycle counting
• (24:26) Cost and capacity KPIs: utilization as a profitability lever
• (25:16) How ProShop ERP can help you achieve on-time delivery
• (26:15) Mike's simple utilization KPI: billed vs. paid hours
• (30:28) Pricing strategy and understanding capacity
• (31:30) Tracking safety using workers' comp modifier as a high-level metric
• (33:18) Why less is more when selecting KPIs
• (34:32) Financial review vs. weekly KPI review
• (36:26) Integrating KPIs into 13-week cash flow
• (37:39) Digging deeper only when KPIs show leakage
• (40:13) Measuring soft KPIs like customer concerns and employee satisfaction
• (42:48) Using employee surveys and tracking trends over time
• (44:00) KPIs as directional tools for improvement
• (45:12) Teaching employees how their actions affect KPIs
• (47:23) Using KPIs in all-hands meetings and bonus plans
• (49:16) Why we created Hire MFG Leaders (and why you should use it)
• (49:45) Final thoughts, how to connect with Jon, and closing

Resources & People Mentioned

• Learn how to grow your top and bottom line with CLA
• The KPIs to Help Manufacturers Improve Company Performance
• Your 6-Step Guide to Achieving Over 95% On-Time Delivery with Minimal Effort
• Cash Flow Power Moves: Pricing, Terms & Tools That Protect Your Business
• Why we created Hire MFG Leaders (and why you should use it)

Connect with Jon Hughes

• CliftonLarsonAllen (CLA)
• Connect on LinkedIn

Connect With Buy the Numbers

• Follow on LinkedIn
• Connect with Mike Payne on LinkedIn

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