Development of a Sustainability-Oriented KPI Selection Model for Manufacturing Processes

Kristo Karjust (), Marmar Mehrparvar, Sergei Kaganski and Tõnis Raamets
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Kristo Karjust: Department of Mechanical and Industrial Engineering, Tallinn University of Technology, Ehitajate tee 5, 19086 Tallinn, Estonia
Marmar Mehrparvar: Department of Mechanical and Industrial Engineering, Tallinn University of Technology, Ehitajate tee 5, 19086 Tallinn, Estonia
Sergei Kaganski: Department of Mechanical and Industrial Engineering, Tallinn University of Technology, Ehitajate tee 5, 19086 Tallinn, Estonia
Tõnis Raamets: Department of Mechanical and Industrial Engineering, Tallinn University of Technology, Ehitajate tee 5, 19086 Tallinn, Estonia

Sustainability, 2025, vol. 17, issue 14, 1-21

Abstract: Modern manufacturing systems operate in a global and competitive environment, where sustainability has become a critical driver for performance. Performance measurement, as a method for monitoring enterprise processes, plays a central role in aligning operational efficiency with sustainable development goals. Recently, a number of different frameworks, systems, and methods have been proposed for small and medium enterprises. Key performance indicators (KPIs) are known to be powerful tools which provide accurate information regarding bottlenecks and weak spots in companies. The purpose of the current study is to develop an advanced KPI selection/prioritization model and apply it in practice. The initial set of KPIs are obtained based on a literature review. The expert’s knowledge, outlier methods, and optimization of the enterprise analysis model (EAM) are utilized for reducing the initial set of KPIs. A fuzzy analytical hierarchy process (AHP) is implemented for prioritization of the criteria. Five different MCDM (multi-criteria decision-making) algorithms are implemented for prioritization of the KPIs. The recently introduced RADAR method is extended to the fuzzy RADAR method, providing a flexible approach for handling uncertainties. An analysis and comparison of the rankings obtained by utilizing five MCDM algorithms is performed. The prioritized KPIs provide valuable input for improving KPIs with the highest impact in particular small and medium-sized enterprises (SMEs) when implementing sustainability-aligned performance metrics.

Keywords: manufacturing systems; sustainability assessment; KPI selection model; KPI prioritization; fuzzy AHP; fuzzy TOPSIS; sustainable manufacturing (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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