Amid the profusion of theories and literature regarding Key Performance Indicators (KPIs), Enchange has developed a practical, versatile tool which is being currently used by many of our clients’ senior management for decision making and performance measurement purposes.
On completion of a Walk Through, core areas within the supply chain are identified and a set of KPIs is put in place in order to assess performance in these areas.
A ‘traffic light’ coding system is used to indicate various performance levels ( i.e. yellow = performance target achieved; amber = below target corrective action is required, red = serious under-performance urgent action is required).
Examples Of Supply Chain KPI Indicators
- customer service levels
- demand coverage
- distribution performance
- inventory management
- planning and forecasting accuracy
- supplier performance
Crucially, individuals own responsibility for measuring their part of the supply chain. The tool includes extensive definitions and formulas together with a comprehensive User’s Guide.
At Enchange we use the Balanced Scorecard format (originated by Kaplan and Norton 1992-2016) to present KPIs. The Balanced Scorecard is designed to support the key elements of the Strategy Map.
An Example Of KPI Development
Step 1 – Select KPIs
Step 2 – Agree target performance level
Step 3 – Performance management focuses on below target performance