5 Most Useful Fulfillment Metrics
5. Fill Rates
Measure both order fill-rate and line fill-rate to get a clearer picture of your ability to meet customers’ order requests. Calculate fill rates based on how well you fill initial orders rather than modified orders. Base them on the customer-requested shipment dates. Those orders not meeting the dates shouldn’t be counted as complete. Measure strategic outcomes using metrics that are process-oriented rather than functionally oriented.
Balance is an essential element of successful metrics programs because it ensures there’s a holistic view of the business. Identify and use a broad spectrum of metrics that together reflect the key contributors to the success of the business strategy.
Embed your measurement process within a culture of continuous improvement. In short, turn data into metrics and metrics into performance management programs that drive tangible and lasting improvements in your organization.
Recap: A Closer Look at Some Metrics
Inventory count accuracy is important to the company’s ability to fill a customer order. Inventory accuracy errors cause unknown out-of-stocks that impact order fill rates. Pair measuring the accuracy with correcting the root cause of the errors.
Order picking accuracy ties to customer service — getting what was ordered — and to operational performance. This measures the accuracy of the orders picked based on errors caught prior to shipment.
Order cycle time is the time between customer order placement and order shipment. Customers’ expectations vary depending upon your shipment policy, such as a same day vs. a 48-hour policy.
Kate Vitasek is the founder and managing partner of Supply Chain Visions, a consulting firm that specializes in benchmarking and education. You can reach her at kate@SCVisions.com, Web site: SCVisions.com.