One of our most powerful business dashboards, the supply chain dashboard boasts a digestible, functional, and visual representation of all key areas of supply chain performance, from inventory accuracy and turnover to the inventory-to-sales ratio. To find this balance it is therefore essential to set up at least these 2 KPIs. Discontinued products and new products not yet in stock are excluded. It is pivotal to calculate this KPI in value terms, as large quantities of products can have a significant impact on the total. DOS is the most common KPI used by managers in measuring the efficiency in supply chain. Quality performance rating: This KPI can show an overall supply base quality rating, but specific quality KPIs at the supplier level are critical to measure specific performance. If you improve your purchase prices, you improve your stock rotation in value (not in quantity). And the answer is… at least one of the two. For example, you can ship 100% of your products ordered by your customer but only deliver 50% within the time requested by your supplier. 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. Service Rate Definition : Out of 100 orders received, the matter here is to understand how many orders are delivered on time. In essence, it is the difference in time between when a business pays its suppliers to purchase inventory and when it receives money from its customers in return for goods sold. Walmart and Amazon each have tens of thousands of suppliers, and it’s their prerogative to get them firing on all cylinders through a proactive supply chain strategy and tighter supply chain integration. If you do not have a store, I recommend using the service rate and you can then use the availability rate as a supplement for your warehouse or factory with an ABC classification (see article ABC management). SCOR Agility metrics include Flexibility and … This particular insight is one of the most critical supply chain KPIs for businesses operating in a multitude of sectors. For example, if you have a big peak of sales for Christmas, you will have a lot of stock before with few sales (many days of stock) before the peak then many sales and few stocks after the peak. Celui-ci permet de piloter les KPI aussi bien individuellement que de manière collective. Also, if metrics and KPIs indicate a company’s logistics and supply chain operations are consistently meeting required performance levels, a company can decide to set a higher level of performance to aim at. This valuable KPI can give businesses a lot of key information about various parts of the supply chain. In the example below, we have collected data focusing on inventory metrics: Inventory-to-Sales ratio, which you can combine with the Inventory Turnover, and clearly see the financial stability of your business. The higher the perfect order rate, the better, because this KPI has a direct impact on your customer retention and loyalty levels. By Sandra Durcevic in KPIs, Sep 27th 2018, "It's not the organizations that are competing. Be careful not to make your animation too complex with too many KPIs for your supply chain. Inventory velocity is a key supply chain KPI that reveals the percentage of inventory that’s estimated to finish during a given period. Your stock is essential to your commercial operation which is why tracking your inventory through a central nerve center will make sure that every supply chain effort and initiative improves the way you run your business as opposed to hindering it. A supply chain business often uses the customer order cycle time metric to gauge its success with this aim. Essential Supply Chain KPIs. But store, shelf-level out-of-stocks (OOS), the most critical KPI in this supply chain, barely changed. This calculation must be done over the last 52 weeks to have a reliable KPI that takes into account seasonal fluctuations as the lower the number of days, the more efficient your stock is. .. les organisations supply chain regroupent un nombre d’acteurs important … 6. Food & beverage (F&B) read more A higher DSO level demonstrates that a company is selling its product to customers on credit and taking longer to collect revenue in a tangible sense, which can stunt cash flow and minimize profits in the grand scheme of things. Remember: Today, access to your metrics 24/7/365 is really important, what online data analysis tools can guarantee and ensure that your chances of long-term success increase. This calculation is only made on the active references of the catalog. In %: out of 100 products, how many are available to the customer (in-store, warehouse…). If you have no record, simply take the average between the beginning and end stock of the chosen period. You can explore our supply chain management dashboard in greater detail here. A pivotal supply chain KPI, the inventory velocity, or IV, provides a visual snapshot of the percentage of inventory that's projected for consumption within the next period or quarter. Pulling data from KPI helps your reverse supply chain system run fast and effectively when embarking on the disposition process. The unrivaled power and potential of executive dashboards, metrics and reporting explained. - Wael Safwat, SCMAO. KPI Cubed is a niche consulting company specialising in Supply Chain and Talent Management functions related to FMCG, Retail and Third Party Logistics Services. That said, here we’re going to look at the top 10 supply chain metrics that will help you, and your business, work toward a bright and prosperous future. Example: Let’s assume that your average stock in 2016 is $1,000,000 and your average daily sale is $5,000 per day. The service rate is used in other industries when you do not have access to your customers’ stock information. In supply chain metrics, the GMROI offers a clear representation of the gross profit gained for every AED (or $, £, €, ₺) of the average investment made in your inventory: a calculation achieved by dividing the gross profit by the average inventory investment. A supply chain dashboard provides an at-a-glance window into your operations and enables you to manage all those moving parts. Managing Partners: Martin Blumenau, Jakob Rehermann | Trade Register: Berlin-Charlottenburg HRB 144962 B | Tax Identification Number: DE 28 552 2148, News, Insights and Advice for Getting your Data in Shape, BI Blog | Data Visualization & Analytics Blog | datapine. This calculation is not perfect because to be correct, it would have to take into account the seasonal fluctuations and arrival dates of each order. Supply Chain Effectiveness Description: The measure of how well an organisation can move product/services from conception to the customer. By gaining this level of insight, you stand an excellent chance at decreasing returns, boosting profits, and improving cash flow as a result. Comme nous l’avons dit précédemment, pour qu’un pilotage soit efficace les KPI doivent être identifiés mais également visibles. The supply chain is essentially the backbone of any business: a living ecosystem that ensures the smooth, efficient, and consistent delivery of a product or service from a supplier to customer. Managing all the moving parts in your supply chain can be a logistical nightmare unless you have access to the right KPIs and metrics. This is the percentage of orders in quantity delivered on time. KPI Library is a community for performance management professionals. One of the most superbly helpful supply chain KPI available today focuses on logistics KPIs and helps a business understand the number of times its entire inventory has been sold over a certain time frame: an incredible indicator of efficient production planning, process strategy, fulfillment abilities, and marketing and sales management. A final parcel KPI supply chain strategy should also monitor the total uptime of online tracking systems. Every company today runs on data – the key to using your data is choosing the right metrics for visibility into your supply chain. In this case: average stock = current stock + stock in transit (with or without, it is your choice). Concerning the continual growth, evolution, development, and success of your company’s supply, fulfillment, and delivery efforts, supply chain performance metrics are the most invaluable tools available at your fingertips. Essentially, a low, or healthy, DSO number means that it takes a business fewer days to collect its accounts receivable. This priceless supply chain metric will help you calculate the length of time required to transform your resources into bonafide cash flows. In line with our “Vision” and “Mission” we offer a complete Supply Chain Solutions package to our clients to reduce their costs and improve Skills levels. Yes, quite possibly the best KPI (Key Performance Indicator) for Supply Chain & Logistics. Here is how freight bill accuracy is calculated: (error-free freight bills / total freight bills) * 100. If stock rotation is extremely low, it is likely that you do not have enough stock and therefore, risks of shortage increase. Muitas pessoas ficam realmente confusas sobre KPIs ou Indicadores de Desempenho nas operações Logísticas e Cadeia de Suprimentos (Supply Chain). Identify in-house or third-party providers that will help collect waste and dispose of assets in a sustainable and cost-effective way. Use KPI Library to search for Key Performance Indicators by process and industry, ask help or advice, and read articles written by independent experts. People love to use buzzwords in the tech industry, so check out our list of the top 10 technology buzzwords that you won’t be able to avoid in 2021. Supply chain metrics are defined by establishing specific parameters which are used in quantifying and defining supply chain performance. A Supply Chain Dashboard is a reporting tool used to track supply chain KPIs and metrics in a single display or interface. Be careful here to take the same period for stock and sales in the calculation. Cinq autres indicateurs pour votre Supply Chain. Quels KPI’s pour évaluer l’efficacité de sa Supply Chain ? The metrics can be utilized in the inventory accuracy and turnover metrics, to the inventory-to-sales ratio. An excellent indicator of how long you may need to ship a particular type of order to a client, customer, or partner, this KPI will allow you to set a benchmark shipping time relative to each product which, in turn, will allow you to optimize your shipping and delivery processes, reducing turnover time, and boosting customer satisfaction levels. For more data-driven wisdom, check out these great dashboard designs that you can get inspiration from. A Supply chain company’s decision to reduce spend must be driven by the data to consolidate suppliers and negotiate procurement contracts company wide. You need to track the current status of shipments, monitor inventory levels and ensure that all orders you ship are completely accurate. By tracking these critical supply chain performance metrics in one initiative space, you will be able to implement initiatives that not only hold maximum value but will also ensure the smooth running and perpetual improvements of your supply chain processes, ensuring that every single cog in the wheel is turning to maximum efficiency - which of course, is priceless. The information on this page WILL help you get it right.Many people get confused about KPIs or Key Performance Indicators in Logistics and Supply Chain operations. In supermarkets, late orders are automatically refused upon receipt but having these 2 separate indicators allows you to identify if the problem comes from your stock or your delivery. Want to visualize & track supply chain metrics with ease? Very few companies have this stock record available per day. I, therefore, recommend that you at least average your stock per week or per month. Calculation: Average stock in value on the last 52 weeks / Total sales x 365 days. Working with three core ratios - the days of inventory (DOI), the days of payables (DOP), and the days of receivables (DOR) - the cash-to-cash time cycle KPI visualizes the period required between the moment a business pays cash to its suppliers and the moment it receives cash from its customers. The speed at which a supply chain provides products to the customer. At no level in a function, or cross-functionally though, should anyone need to monitor more than a few KPIs. Retrieve the complete list of orders received over the desired period. Recent studies suggest that 79% of companies with high-performing supply chains earn a revenue growth greater than the average within their sector. Je vous déconseille d’appliquer les indicateurs Supply Chain suivants avant d’avoir mis en place les premiers. I strongly recommend working on a value (cost) basis and not on a quantity basis because this stock represents your fixed assets. Note that if you already have an ERP such as SAP, you can most likely extract the actual stock coverage per item. The next KPI of this particular dashboard is the Carrying Cost of Inventory, followed by Inventory Accuracy and Out Of Stock Items. However, it will alert you to the future risks of breakage and overstocking. Theoretically, to meet 100% of your customer needs all the time, and to face all possibilities (delays, strikes, quality problems, meteorite…), you would need to have infinite stock. Top 10 IT & Technology Buzzwords You Won’t Be Able To Avoid In 2021, Top 10 Analytics And Business Intelligence Trends For 2021, Utilize The Effectiveness Of Professional Executive Dashboards & Reports. Here is a summary of our top 10 supply chain KPIs we discussed in detail: If you want to track and visualize your supply chain metrics and KPIs with ease, you can try our KPI software for a free 14-day trial! Der Lagerumschlag gibt an, wie häufig der gesamte Lagerbestand in einem bestimmten Zeitraum verkauft wird. How to Improve Supply Chain KPIs. It is calculated by dividing the average inventory on hand (as value) by the average monthly demand (as value) and then multiplying it by thirty, when measuring on a monthly basis. Stock life = 1,000,000 / 5,000 = 200 days. Be careful not to make your animation too complex with too many KPIs for your supply chain. It's the supply chains that are competing." While an argument exists that only customer-facing platforms should have top priority, it’s equally essential to track the business-to-business portal uptime. By effectively utilizing their procurement data across all departments, a supply chain analysis can compare product spend across suppliers while analyzing their percentage of contract spend. This calculation is done at the instant T, ideally on the same day. Compare Top Supply Chain Management Software Leaders. Also, the more stock you have, the less « efficient » it will be. This primed and ready for use Microsoft Excel template will assist in monitoring past, present, and future numbers in an expert manner. The availability rate is mainly used for retail (stores) and distribution to know its availability rate in-store departments. The attributes of an effective supply chain will offer transparency, flexibility and alignment to tailor the system to the strategic benefit of the organisation. Pilotage Supply Chain avec KPI. Supply chain is a wide concept that aims at putting to use several resources like people, technology, organizations in such a manner that it facilitates movement … While this may not be the most panoramic or all-encompassing of supply chain metrics, inventory days of supply is particularly useful as it will give you a fairly accurate calculation of the number of days it would take you to run out of stock if it wasn’t replenished. And if your supply chain is inefficient, ineffective, or fragmented, it could seriously hinder your commercial prospects. KPIs can help identify the weak links in the supply chain so that action can be initiated to enhance performance because the chain is affected by its weakest link, according to Prem Vrat, Ph.D., pro-chancellor and professor of eminence and chief mentor at The Northcap University, in India. Purchase full version of Supply Chain Measures + bonus. 5 Ways to React to Supply Chain Disruptions in the Food and Beverage Industry. Le coefficient de rotation des stocks fait partie des indicateursà prendre en compte et dépend directement de l’intensité de l’offre, de la demande et de vos capacités à anticiper les variations sur le marché. If you want to go further and learn how to set up the best KPI for your Supply Chain & Logistics, track your performance on Dashboard and have access to exclusive Excel templates, you can join our new online course to Measure & Track your SCM performance here, Copyright © 2020 AbcSupplyChain LTD | Legal & Terms | Contact, new online course to Measure & Track your SCM performance here. This is to quickly see if your next order arrives in time not to be out of stock or too early not to be over-stocked. One of the most superbly helpful supply chain KPI available today focuses on logistics KPIs and helps a business understand the number of times its entire inventory has been sold over a certain time frame: an incredible indicator of efficient production planning, process strategy, fulfillment abilities, and marketing and sales management. More ideas on using Supply Chain KPI. Quais usar, quantos usar? 5 other KPIs for your supply chain. While Key Performance Indicators (KPIs) may be reviewed quarterly or monthly, the speed with which supply chain operations occur makes a daily view of more tactical and operational metrics a growing necessity. If one supplier can’t keep up, a … If there were an award for “KPI with the longest name,” this one would surely win hands-down. You can simultaneously manage a service rate on time for orders shipped and a service rate on time for orders delivered on time to manage both the quality of your stock management firstly and the quality of your logistics secondly (order preparation + transport times). Check out what BI trends will be on everyone’s lips and keyboards in 2021. Also called stock life or stock coverage, it is the average number of days that the stock takes to run out. Your objective will, therefore, be to find the right balance between customer availability and stock rotation.
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