key to improving the supply chain indicators.
Planning the supply chain (CdS) is a fundamental process on which most of the key operations of any company is based. And as we know, talk about “process” when we refer to the CdS planning and understand it as such, ie, as something perfectible, not closed, subject to ongoing reviews and evaluations is as or more crucial that planning itself.

kpi2

The CdS planning, therefore, not only includes the design and implementation of supply chain, but also its supervision and monitoring process performance and key activities taking place in each of its phases, so which have performance gauges to measure them properly is absolutely essential to achieve a continuous and sustained improvement over time.
Types of indicators to improve supply chain

Each process or activity involved in the supply chain must be properly monitored, so it is necessary to select and establish appropriate individual meters that allow, at a glance, evaluate their performance. But beyond these indicators, which often afflict apparently insurmountable off each other, there are other indicators that relate each and every link in the supply chain ensuring that the strategic objectives are met.

These meters are those who, in the first instance, allow a sustained improvement in the supply chain, and that consequently be included in any planning CdS observe this improvement as one of its main goals. To simplify matters, we can meet these key performance indicators or performance in 3 main types (extrapolated from key financial indicators), established by function:

Predictive meters or leading: as the name suggests, is predicting oriented indicators in order to anticipate possible malfunctions, irregularities or other mishaps in the proper performance of the supply chain. Deviations in the process, line stoppages of production, loss in quality of raw materials, services or goods manufactured … all those indicators to assess potential scenarios (in a positive or negative sense) that could face the organization allowing greater anticipation, making better decisions accurate and immediate, and increased use of new business opportunities.

Historic meters or lagging: essential for a real knowledge of the state of the company, and the processes and key activities involved in the performance of the supply chain.

Meters coincidence: they are those that offer a real-time performance of the supply chain, in relation to the state of the market, demand and the responsiveness of the company.

There is no doubt that in the CdS planning, development of new technologies has exerted a powerful influence, almost completely transforming the scene of business management. Therefore provide appropriate information and knowledge on the issue is decisive in achieving a sustained improvement in the supply chain, an issue that resources like guide The e-commerce and the new supply chain, available completely free, discussed in great detail and clarity.

Management indicators for supply chain

The process of measuring the results of the supply chain has evolved since the mid-eighties. That’s when it became integrated into the tactical and strategic focus of organizations, based on metrics obtained from different indicators. Since then, we have developed several models of performance measurement structures that allow collecting this type of data.

There are several performance indicators that can be applied when measuring the performance of the supply chain but, almost always, are organized around three main pillars:

Services.
Activities.
Speed.
However, entering in specific areas, often resort management aindicadores that provide insight into the financial and economic performance of the supply chain from end to end. In any case, the best results are obtained when the definition and establishment of these indicators is carried out taking into account the particularity and specificity of each system to be measured.
Examples of performance indicators for supply chain

A fairly complete compendium of indicators for supply chain management can be found in the book of Milind Kumar and Rajat Bhagwat “An integrated BSC-AHP for evaluating the management of the supply chain approach.” The authors, from his knowledge of the subject, they propose the following:

A / Finance

Return on investment (ROI).
Adjust the budget.
Degree of collaboration between company and supplier.
Operating cost per hour.
Information on cost management.
Rejection rate each provider.
B / Clients:

Perceived value of the product received by the customer.
Range of products and services.
Time order delivery.
Flexibility specific customer service.
Efficiency in the delivery of the invoice.
Reliability of shipments.
Responsiveness in urgent deliveries.
Information on cost management.
Quality of delivery documentation.
Quality of products delivered.
Deliveries with zero defects.
C / processes.

Total cycle time of the supply chain.
Delivery time supplier to the industry standard.
Rate supplier deliveries with zero defects.
Accuracy of forecasting techniques.
Cycle time of product development.
Cycle time orders.
Total cost of inventory
Inventory cost of raw materials and inputs.
Cost of product inventory in transit.
Cost of finished goods inventory.
Cost of waste.
Percentage of returnee purchases.
D / Internal development:

Responsiveness to technical problems.
viable initiatives for reducing costs.
Booking procedures suppliers.
Order entry methods.
Accuracy of forecasting techniques.
Cycle time of product development.

Performance indicators, strong support

The complexity of supply chains is growing, as the difficulty of managing them also increases. More products, better services, greater customization and all at an unprecedented rate. Globalization is a fact and this affects the ability to control, you can see improved if:

the necessary coordination with systems information technology is established.
integration between different elements of the chain is looking for.
oriented continuous improvement methods are implemented.
The above three points require objective and reliable data to be realized and these can only come from the management indicators that provide the metrics that make it possible synergies, minimize risk and improve overall results.

The best KPIs. Examples for monitoring the supply chain
Indicators improved supply chain are the only way to take the pulse of their performance. Some of the KPIs of the examples proposed below are sample that virtually any of the actions that take place throughout the supply chain, from end to end, are measurable.
KPI – Key performance indicator
The collection of metrics from loskpis examples facilitate the acquisition of an overview of the business. This visibility is characterized by:

Based on relevant and effective indicators in performance measurement.
It is coated with objectivity, the basis for decision-making accuracy.
Facilitate progress towards the strategic objectives.
In addition to proper selection of KPIs, the examples are provided in the next section illustrate that involve most useful; it is necessary that the process of implementation of these indicators is carried out properly. This includes:

1. Guidance on the requirements of reporting systems.

2. Developing well-documented definitions of kpi.

3. Planning processes change management.

4. Contingency Plan to support the resolution of problems arising from performance management.

KPIs examples applicable to the supply chain and its management

Measuring progress toward business strategy and provide visibility at all levels of the company in terms of its contribution to global goals is the role of performance indicators. As is the case of KPIs the following examples:

A / KPIS examples of procurement and suppliers:

Number of managed providers.
Supplier deliveries on time.
Rejections provider.
Purchase costs (understood as a percentage of gross sales).
B / KPI examples inventory management and forecasting:

Number of SKU / Line Items.
Stock of finished products.
Stock of raw materials.
Level of accuracy in the catalog.
Inventory obsolescence.
Inventory management costs (understood as a percentage of gross sales).
Inventory maintenance costs (understood as a percentage of gross sales or total inventory value).
average inventory value.
C / KPIS storage examples:

Accuracy rate in the preparation of orders.
Number of inventory items incorrectly located.
Number of times a product is handled.
D / KPIS transport examples:

Number of orders shipped per day.
Truck output frequency at full load.
Number of deliveries on time.
E / KPIS examples of customer service:

Number of customers.
Number of purchase orders managed per day.
Rate of lost customers.
Product return rate.
Number of deliveries to the customer on time.
Percentage of damaged products.
Invoice accuracy rate.
Payment methods employed.
Customer service cost (understood as a percentage of gross sales).

Quality indicators in logistics management and transportation
The quality management is an absolutely crucial in the planning and management of the supply chain aspect, although its concept does not always have a tight enough understanding what it really represents.
Too often, the quality management is interpreted as the planning and observation of a set of measures to provide products or services in accordance with certain quality standards established unilaterally by a responsible company. However, the reality is much less relative and ambiguous and, as we shall see, the jurisdiction of the quality management transcends far beyond the limits of mere production or provision of certain services, which determines in a decisive way the selection the most appropriate quality indicators.

Quality indicators: a comprehensive view of the supply chain

Quality indicators, as mentioned, are reduced too often to assess the quality of the final product or service provided according to the standards set in the quality manual of a company, the main tool that determines the selection of indicators more suitable for each case.

It is therefore in the quality manual lies the basis for the adoption of a policy of appropriate quality, a manual in its development should give priority to the consideration of the standards defined by international agencies and other specific criteria. As we have seen in the past, observing the ISO 9001 standard is, in these cases, indispensable, a standard which requires consideration of all operations, processes and activities involved in the supply chain in a comprehensive way.

If we consider that the ultimate goal of any quality management model is to increase the level of customer satisfaction, any link in the chain that takes a more relevant for optimal end result importance. And in the case of companies specializing in logistics and transport, this becomes especially transcendental.

From planning to receipt of the goods by the customer, and including of course the reverse logistics operations are carried out, each and every one of the processes and activities involved in the service play a crucial role when complying with standards of quality objectives. For this reason, and as an example, we can list some of inescapable quality indicators to be included in all scorecard intended for monitoring transport and logistics operations:

Cost-benefit ratio: cost reduction or seeking higher profits should not, under any circumstances affect the required quality levels. Therefore, the indicators selected quality for this purpose must be to relate these aspects, seeking to set minimum Uncompromising quality and forced to seek alternative ways to reduce costs and expand profit margins that do not affect the provision of quality service .

Time: time reduction in management, loading and distribution of goods resulting inevitably in improving service quality, so this item should have adequate indicators in all the KPI quality to be implemented .

Level of customer satisfaction: it is essential to have indicators to measure objectively a degree of customer satisfaction with the service provided. In this matter they come into play both quantitative indicators (number of complaints received, care provided by the customer service …) and qualitative indicators (customer observations, comments received through different channels …).

Reverse logistics operations: these operations must have specific indicators to assess aspects such as collection times and return of goods to the point of origin, costs passed on to the customer, profit margins-losses, environmental impact of these operations …

key to improving the supply chain key performance indicators.

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