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Performance measurement is one of the methods used to deal with organizational and company developments in order to maintain the company's competitiveness. UKM Akbar jaya bakery is an industry that was founded in 2001, located in the city of Medan which is engaged in the bread and cake industry, with a total of 8 permanent employees with a fairly high production level and a fairly short order time span. The problem in this research is not achieving the planned daily production capacity which is caused by unstable employee performance in each production process. Key performance indicators (KPI) or key performance indicators are determinants of key indicators that are measurable and provide information on the extent to which the strategic objectives assigned to a company have been successfully achieved. A company that uses KPIs will make it easier for companies to measure or evaluate employee performance and can reduce the element of subjectivity because employee evaluations are more objective. The purpose of this research is to optimize the level of performance measurement of Akbar Jaya Bakery's employees in order to meet daily production targets using the KPI method. Based on the analysis obtained from UKM Akbar Jaya Bakery in 2022 and 2023, it is found that in 2023 there will only be an increase in the proportion of demand fulfillment in the previous year, it is still very significant, a strategy is needed to improve employee performance, namely by providing rewards or bonuses, fulfilling employee rights, provide more training or training, build the owner's friendship with employees, as well as transparent performance appraisals for employees. From performance measurement using the key performance indicator method, it can be concluded that through the key performance indicator method, as many as 9 performance assessment indicators are formed which will become a reference for selecting the main performance indicators in measuring employee performance, namely: Fulfillment of requests, Reduction of Waste, Optimization of material costs, Efficiency of use raw materials (flour), Participating in Training, HR with expertise, Adding Production Equipment, Increasing types of cakes, Punctuality. Based on this research, only 4 indicators are the most prioritized in improving employee performance, namely efficiency in the use of raw materials (flour) with a yield value of 125%, skilled human resources with a yield value of 100%, addition of production equipment 166%, and an increase in the type of cakes with yield value of 200%.
Keywords: Performance Measurement, Employee Performance, Key Performance Indicator.
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