– Inventory Management. I’ve found that the KISS principle is best for understanding most KPI’s and implementing them in any industry. In either case I’m not sure the KPIs differ that much……. However I would like to know your opinion? As a result of these changes, several large pub companies sprang up, and the brewing company (the subject of this study) determined to sell distribution services to these entities. first of all THANK YOU for your articles and your answers. We’ve assembled a collection of sample Key Performance Indicators for you to use as a starting point when building scorecards. I like this site, because so much useful stuff on here : D. hi I am a logistics supervisor,my role involves warehousing,inbound and outbound logistics,transport operations what are the right KPIs for my job. Required fields are marked *. Hi, thank you for the article, it was very helpful. You can use the perfect order KPI to track OTC performance, by breaking it into its components and applying the metrics as relevant to the different functions in your supply chain. Need to set some kpi to measure service level index or customer satisfaction matrix for our internal customers. Why Klips. WMAPE with promo packs is not something I have any direct experience with. I’m in the industry of e-commerce Under operations for First Mile and Last Mile Delivery. What Are Logistics KPIs Good For? Please send me your fortnightly Email Bulletin. If a new service offer was being promoted for example. Monitors the degree of incidents from the placement of the order to the delivery of a shipment. The more background you can give the better. The 6 most important KPIs for logistics service providers. What type of planning? Always think about what precisely you are trying to measure. Marketing KPIs. Ideal for companies that offer road transportation. I work in a firm where the supply network is now being newly designed. These problems were all carry-overs from an earlier era when the logistics operation primarily served an internal supply chain. Dear Rob, Thanks for the article and all the helpful tips. Lead Time is a KPI that tracks how long your company’s processes/operations last, from start to finish. Supply In Full On Time. Dear Sir Can you suggest some KPIs for a material management department which deals with network parts that are delivered by suppliers? KPIs not only provide an organization with a focus for strategic and operational improvement, but a way to compare achievements to similar organizations. However, the traditional model for licensed alcohol sales was undergoing a transformation, with most of the major brewers disposing of their estates following freshly introduced laws, implemented to curb what was seen by the government as a barrier to fair competition in the industry. So take cost as a start. My current position is Supply Chain Manager in Automotive company dealing with foreign and local suppliers and also we serve the aftersales and whole sale for genuine parts for many brands, below areas are reported to me: – Procurement and logistics. POD records are often delayed. Logistics involves the significantly sophisticated data, communication as well as management systems needed in the modern business ecosystem. Do they directly support those objectives? What figure do you use for non-promo? For Procurement KPIs I would think about……….. Supply In Full On Time (SIFOT) by Supplier. However, in Supply Chain, you would generally expect to see the following standard set, along with those that are more specific to your business needs. Hi Rob, I am trying to find templates to structure SLA’s for the below type of 3PL providers. Yes! In a single overview, they show how far you have reached your goals … Best Regards, Rob O’Byrne Email: [email protected] Phone: +61 417 417 307. Deliveries per hour Cases/units. I always suggest keeping it simple. As some basic inventory KPIs I would suggest: Stock Turns. Thanks for the above KPI’s , I need to see some KPI’s for Supply chain GM / Or Director level Specially in Food Manufacturing sector. I don’t think your industry would be any different from others. HI Rob, thanks for the great article, I recently joined a healthcare manufacturer as a logistics specialist, I need to create a KPI for the last mile inland delivery whether to warehouse or customer directly. Freight Forwarder informed within specified timeframe. As in any business activity, supply chain operations need to focus doggedly on improvement to compete in the market place, but how do you know if your supply chain performance is satisfactory, or if it is getting better, or worse? Dear Rob, In the context of a Sponsor (pharmaceutical company) outsourcing to a CRO their clinical trial management including clinical supplies activities, which key indicators would you recommend to assess/oversight performance of this CRO on these Clinical Supplies activities until drug kits delivery on sites? Great post. IT KPIs are not really my area of expertise, but thinking about it logically….. You need to make sure that the KPI is measurable, accurate and clearly understood. Nevertheless, it is essential to have a hierarchy of KPIs, since, as already mentioned, a level of granularity suitable for one level of management will be either too general, or too detailed, for another. Product received within expected timeframe. The article shows you exactly how to measure it. Steps to create KPIs of logistics operations manager 1. Please help! 6) Each KPI should reinforce and/or balance others. Also ideal for the freight forwarders that offer warehousing services, this KPI monitors the expenses involved in the management of your logistics company’s warehouse facilities. Can KPI be used for better logistic and supply system. The customer and the supplier would work together to develop KPIs that would highlight why many pubs were receiving deliveries with incorrect product quantities, and why even more deliveries were arriving late. it is useful information, am working in a project to deliver high quantity and value of a product using the Air mode. Cost of storage per unit. Debtor days, Cash at Bank, Current Ratio…. When measuring the effectiveness and cost of your supply chain, you will need to set up and monitor KPIs that give visibility of cross-functional activity as well as those applicable to individual supply chain components. Among others, these measurements refer to transportation, warehouse and supply chain aspects. Exactly how many is hard to say and will, in any case, vary from business to business, but frankly, if you are tempted to ask if you have too many KPIs, you probably do. The primary purpose of a Key Performance Indicator (KPI) is to provide a metric of how well a process is working. Dear sir, I am researching towards transport KPIs but these have to be made visible in a dashboard. If you can help me with specific points which need to mention for KPI’s it will be great help. You might call the highest level the “primary tier,” and the second level the “secondary tier.”. Any ideas would be much appreciated Thank you. For example, Perfect Order = 98.5%, Inventory accu. I did manage to implement Picking speed and picking accuracy as a KPI for the warehouse as well as an incetive for the picker(they get bonuses for good performance). This KPI can be helpful for forwarders to know the average spent in each shipment and send accurate quotations to their customers/partners. Yes, you can certainly measure Delivery In Full and Delivery on Time as two separate metrics. The competitiveness of a city, the efficiency of a city. Go to this page: https://www.logisticsbureau.com/supplychainbenchmarker/. Sales $ per hour, sales order per hour, number of customers v number of sales. how can I determine this? There used to be an annual report, the Controllers Report that was available for about $500. My objectives is Improve Performance efficiency of SCM delivery and quality. I presume the Logistics Coordinator is managing outbound delivery? That makes fluctuations immediately visible, and if performance moves in the wrong direction, you can quickly respond. Performance indicator that measures the utilization of the load capacity of a vehicle during road transport or a container during sea freight. SIFOT (Supply In Full On Time). Advice. I would like to know your thoughts about the digital supply chains especially in automotive sector. https://www.supplychainsecrets.com/. I’d like to know which KPI’s of relevance you could recommend to me for use in my company. In the logistics area, KPIs are very important for measuring production, costs, and quality rates. Can be more specific? I’m afraid you’ve ‘got me’ there! The OTC cycle loosely comprises the following sub-processes: OTC is a process that illustrates clearly, how the supply chain comprises a broader range of business functions than you might have thought. could you kindly send me the PDF of the above article. Still, it’s worth briefly discussing, as an example, one of the process cycles commonly used when monitoring supply chain performance. The first step is schedule establishment. https://www.logisticsbureau.com/supplychainbenchmarker/, https://www.benchmarkingsuccess.com/online-key-performance-indicators/, https://www.logisticsbureau.com/supply-chain-levers-part-5/, https://www.logisticsbureau.com/contact-us/, https://www.youtube.com/playlist?list=PLAI2rbd3NwK7DeHvXIESAUaXquZFl3Lk7, Supply Chain Strategy Development - Article | Logistics Bureau Blog, Outsourcing Transport and Warehousing: How to be Successful, How are your Supply Chain KPIs or Vital Signs? This is exactly what the logistics key performance indicators are for. Procurement and supply function responsible for the following; 1. The capabilities of supply chains are continuously changing to reflect the latest … Definitely! Perfect Order Rate: Number of orders the warehouse delivered without error. I work for supply chain department.what KPI would you think would be auitable in food industry,95% of the products are import.. The second step is the information collection. At the beginning of this article, I stressed the importance of not having too many KPIs. KPIs should comprise a handful of metrics that your teams CAN realistically monitor and react to continuously. It wasn’t long before problems arose, with the customer threatening to exit the contract under a service-level clause. Leveraging new technologies and freight forecasting platforms make the best decisions possible for freight broker profit gains and net value across all segments. The logistics value chain begins with demand planning and ends with final delivery – and each link in the chain can have a domino-like effect on others. Here are the 6 KPIs that should be in every customer service report. Data accuracy is another matter of course. The company works in the electronic envirnment. Also I’m really strugling to come up with something for the fleet other than cost as a % of sales. Hi Mathew, I don’t think you’ll find those things available for download anywhere. If you wish to keep things as simple as possible, you should find that two levels, or tiers, of logistics KPIs, are sufficient. Also what best tools can be use to reduce the needs of follow-ups in terms of supplychain. My job basically will involve with overall dept performance & excellence, right I’m having problem to come up with specific KPI for my function as I can’t put the KPI such as delivery, transit time & quality performance as my KPI since it has been covered under specific section under Logistics Dept, Hope you can give me some advice on how to formulate specific KPI to cover overall dept performance, quality & cost. Among others, these measurements refer to transportation, warehouse and supply chain aspects. The only difference is that in most cases, you wouldn’t wish to lower performance when a business activity exceeds the required standard. 4. Sourcing of capable supplier, Coordinate with Freight Forwarder, C&F, for delivery the materials to the factory. The KPIs are based on: On-time In-Full, CO2 emissions, quality etc. When it comes to supply chains, it’s important to identify the major KPI’s. Let’s assume a system or process issue that results in the delayed posting of the customer’s payment. Then for example, if the minimum level is not reached for 3 periods in a row, a penalty might apply. But I would at least start with one that targets service and another at cost. I have been tasked to prepare KPI;s for delivery Drivers and the workshop guys. First though, let’s walk through why KPIs are important, and some of the principles for applying them successfully. Best of luck! These sample KPIs reflect common metrics for both departments and industries. This KPI measures the truck’s turntable, that is, the average time spent between the exit for collect/delivery and the return of the vehicle to your company. You might want to look at: Number of people employed in the sector (Transport and storage) Square metres of warehouse space Number of trucks in local fleets Tonnes of freight handled Logistics ‘spend’ (transport and storge, hy, Iam an intern. Hi Raja, Supply Chain KPIs are very specific to each industry and business, so it is not possible to be precise without further information. I think prior to that it’s about have an objective set of selection critria. Sourcing mechanical parts/tools used by the maintenance team. My main responsibility is Procurement of Industrial Machinery, spare parts,raw materials. Stationery cost per month, printing costs per month…. What is the difference between KPI & Performance Management System 3. Well said, Good to know about some much-needed KPI’s of logistics, how to implement them to achieve relevant results. With all the systems and softwares created to facilitate logistics management, there are currently several ways of collecting data on a company’s processes. If so, is there an example? Accountability and Responsibility for: 1-Parts Operations -Ordering 2- Inventory Management 3-Clearance and logistics 4-Counter Sales Representative 5-Prts Service Coordinator . Value of stock sold as ‘mark downs’. How do I calculate Logistics Cost as % of Sales? This success, in turn, helped to strengthen the brand’s presence in the pubs of the groups that it served, and raise its profile in the British beer market. The Logistics industry makes use of KPIs to make note of how poorly or how well their industry is performing in the business market. I would like to know KPIs in Parts Operations Department . Are you using this data in your business' favor? I would think suitable KPIs might include quality compliance, temperature compliance, along wit all the regular KPIs like DIFOT and SIFOT. Service level agreements, in particular, will be monitored through KPIs agreed between an enterprise and its customer, with the probable application of penalties should performance fall below agreed levels. How many people or materials are carried each day. These are deliveries from your suppliers to YOU. These KPIs were then cascaded to even greater levels of granularity, with the use of error codes to identify where and how delivery errors were originating. You should certainly use KPIs to manage staff. If you’d like to read more about Supply Chain KPIs, you can download (free) a chapter from one of our Best Selling Books on the topic. Can you please help me in this way? What will impact the cost? The best way is to use electronic POD devices. = 98.5%, etc. So in this case, you have a third party buying products, for you to sell to your customers. Cost per case delivered. Dear Sir, I would be most obliged if you could answer the following questions? This is your own performance, Delivery In Full On Time, to YOUR customers. Jan 3, 2020 | Benchmarking, Performance Measurement - KPIs | 210 comments. I think we will always be measuring similar cost and service KPIs. And then what the key ‘drivers’ are that lead to that outcome…. I’d look at (assuming this is gas station delivery) Cost per delivery Cost per cubic metre / 1000 litres Drops per run Drops per vehicle per week Kms per drop That type of thing…, Hi Rob, Is there a KPI for a selection process for new suppliers. Thank you for sharing…. I think to keep it simple, start with DIFOT. Many people get confused about KPIs or Key Performance Indicators in Logistics and Supply Chain operations. and we deal with freight forwarder agents for our equipment’s to ship by Sea, Air & Land to project locations. There are your KPIs…. This logistics key performance indicator, also known as OTIF, measures the percentage of orders delivered within the stipulated time, without any problems or documentation issues. But the real question is: are you using this data in your business’ favor? It’s a composite KPI called perfect order, and it incorporates functional measurements for all stages of the OTC process. That’s especially true in any business where customers tie into agreements or contracts. Highly customizable reporting automation tool. Share those, and then let’s talk KPIs. Sir, Really happy to see this web. KPIs don’t change much by industry. Stock turns Inventory record accuracy Overall Inventory value. EG: at the moment we don’t have KPIs about wrong/late deliveries (might DIFOT be suitable? Managers who oversee the running of departments and are responsible for Logistics and Supply Chains have a significant number of considerations to make when tracking a successful operation. Quite simply, the logistics functions had not adapted to a new environment in which retail outlets were no longer “tied” to the brewery. Please I work in the Oil & Gas industry more specifically LPG distribution. They should focus on the essential outcomes for that department. The short answer I think would be these KPIs: Transport Cost per order delivered. Hi Rob, I am Mohammed working in Well Site Services company as Logistics In charge and need to put in place KPI’s for Logistics Dept. That would at least get you started with a KPI around each of, service, productivity and costs…, I have recently joined as Logistic Manager in a construction company..want to know the KPI of my Dept. Depends what you are trying to measure. In each case, it was the application of appropriate KPIs that made the difference. Functional KPIs offer value, of course, but when you combine and integrate them to offer an end-to-end view of performance trends, you can magnify that value considerably. Because there is no record of payment, the customer’s account might be put on hold in your ERP system, and the whole process of supplying that customer stops until somebody spots the problem and resolves it. Dear Sir, Thanks for the above KPI’s , I need to see some KPI’s for Warehouse manager / and Senior supervisor levels Specially in Pharmaceutical Manufacturing sector. But the information is hard to gather and is therefore valuable IP. Like all KPIs, you really need to start with the end in mind. I work for manufacturing industries, which produce packaging for liquid Food industries. Ideal for forwarders that offer warehousing services as part of their logistics solutions. But I don’t think it’s available anymore. You mean invoices from your supplier right? Based on continuous monitoring, these weaknesses or shortfalls against targets or objectives set can be corrected or revised in order to continually improve performance. Thanks! (3) Waste cost as a % of sales (4) Damage costs as a % of sales. Which ones to use?… How many to use?Sadly, it’s not such an easy question to answer.Of course, they need to be SMART—Specific, Measurable, Achievable, Relevant, and Time-phased—but this may too rudimentary a set of rules to ensure KPIs are useful. Monitoring key performance indicators (KPIs) is an important part of your operations and this is especially important for tracking 3PL performance. Thank you. I’ve seen KPI “packs” the size of phone books, and even KPI sets circulated as a monthly magazine… that no one reads. please can you help in giving me some KRAs to set . To Deliver Fit for Purpose Property, Plant, Equipment, Products & Services at Right Quality, Time & Place (Safe, Efficient, Effective & Economical). This logistics key performance measures your company employees’ production rate (workforce/labor hours/productivity). 4) KPIs should be actionable, providing timely, accurate data that owners can interpret and utilise. In the planning process, t… It can be helpful, therefore, to identify the processes involved in your supply chain before deciding upon the functional-specific measures that collectively, will show how these processes are performing. The one caveat I would add here, concerning golden rule #9, is that it’s essential to incentivise only behaviours that do not jeopardise health and safety or regulatory compliance, or otherwise put the reputation of your business at risk. Hi Daniel. Hi Rob, Can I get KPI’s for a materials issuing/oubounds officer in a warehouse system. It is often used as a term for the process or ‘system’ used to manage staff performance. A recent publication by the Minnesota Department of Transportation, Measurement Sources for Freight Performance Measures and Indicators, identified dozens of ways KPIs are used. Hi Derek, What are the three most important aspects of your service? You’ll find lots of articles on KPIs on our blog that should help. kindly assist me in the key performance indicators in this department. Sourcing packaging and supplying that to the production function. The company’s customers mainly comprised pubs and restaurants, which were either under individual ownership, or owned by the brewing company. We actually have a business that provides KPI Benchmarks. Pallet, case? I need to know how to measure and benchmark the KPIs of outbound logistics. In which terms could we measure this. The KPIs required for Reverse Logistics will vary slightly from one industry to another, but some indicators remain standard across the board. I have set a measure to measure the WMAPE for our PP performance however since it is a new KPI, what would the best target for the measure be? Yes, I think it’s always important to share your KPIs so that others know what is important to you and how they can support you best. The use of our Supply Chain and Logistics KPI Dashboard programme will help you maintain an overall measure and give you a view of which activities need your attention. What things commonly degrade performance. Get the idea? You might want to measure % instances outside temperature allowances. Running time loaded v unloaded. Hi Rob, Great page on KPIs. Can you assist? Hi. KPIs are mostly used so that employees of a particular organization are able to apply constant improvements to their procedures, which can result in better productivity and profit margins. Though do a search on this blog for measuring the ‘perfect order’. Hi Jacky. Is it consumables, rotables, equipment. Sadly it’s not such an easy question. 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Much-Needed KPI ’ s not such an informative presentation, i don ’ t have KPIs operational kpis for logistics deliveries...

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