Introduction to Supply Chain

Management
Lect -2
Supply chain Performance Metrics
Supply Chain Metrics/KPIs
Its not easy to measure every activity or goal
Managers choose reasonable metrics according to SC strategy
Some strategic metrics are :
Three Vs
Velocity
Visibility
Variability
Others are Collaboration, trust, customer focus and flexibility
Three Vs

The Three Vs
Supply Chain Metrics/KPIs
Customer focused Metrics

If Customer expectations met it leads to satisfaction

Customers have expectations about availability performance and reliability

Operational Metrics

Reliability (Perfect order fulfilment)

Responsiveness (Order fulfilment cycle time)
Agility (Ability to respond)
Customer Focused Metrics
Operational Metrics
Perfect Order fulfillment -Reliability
Responsiveness (Order fulfilment cycle time)

Is the avg. speed order delivers to customer

Order fulfilment cycle time = order fulfilment process time + Order

fulfilment dwell time

Dwell time
Amount of time order waiting to move from one stage to another stage
Agility (Ability to respond)

Agility is the ability to respond market changes and remain

competitive
This attribute has two metrics flexibility and adaptability

Flexibility No. of days required to achieve unplanned increase in quantities

Adaptability amount of increased and decreased production an organization can achieve