Data-driven insights into supply chain can help you move from reactive performance metrics to transformative improvements.
Reactive performance measurement isn’t uncommon, and even businesses with complex logistics operations often measure and report performance this way. You are probably familiar with KPI’s such as order handling time, delivery precision, lead time and on-time, in-full (OTIF)? Manual reporting on these target figures can be time-consuming. The quality basis is also of varying quality, and as a consequence the figures presented to the management team can often be inaccurate.
It is also unlikely that reactive performance measurement will give you a comprehensive overview of performance in all areas. How, for example, does the transporters' performance affect warehouse operations, and vice versa?
Reactive and fragmented results measurement makes it difficult to uncover the root causes of problems, such as which areas and departments are failing.
Another downside to reactive performance measurement is that you’re often simply too late. Hindsight is of little help when delays in the supply chain have already had a negative impact on the bottom line. What you want to measure and analyze is the entire business's ability to deliver according to the customer's expectations – in real time. Do the customers receive what they have ordered at the agreed time?
Proactive improvements in all areas
Digitization of the supply chain makes it possible to analyze the company's ability to deliver in line with the customer's expectations. Here we reach the core of our business philosophy: From the very beginning, we have optimized logistics, reduced costs and facilitated better decisions across the Nordic region.
The benefits of digitization are many, and through our platform you can reap several of them. Take KPI reporting for example. We help you on your journey from manual reporting to analysis and action. Automated data capture gives you the decision-making basis you need to see what you can do to save money, identify improvement potential in the supply chain, and thereby create the best possible experience for your customers – and your own bottom line.
In recent years, the emission dimension has also become increasingly relevant. Not only do your customers expect increased awareness of climate emissions; the legislation also requires cleaner logistics solutions. Not least with the EU's taxonomy, and the new reporting requirements that follows. We give you an easy way to quantify the emissions from incoming distribution, all the way to the end customer. It’s not only useful for reporting, but also gives you a better understanding of your climate footprint – and how you can cut it.
Our technology also makes performance data visible to the entire organization. For full effect and the best conditions for joint anchoring throughout the business, we ensure that all employees gain operational insight into how logistics affects profitability, emissions and customer experience – in real time.
Broad engagement is the key to success
A successful digitization strategy is about more than good technical tools alone. The key lies in integrating the target figures into the company's culture, and applying them strategically in daily operations. To be succeed, it is crucial to engage the employees with target figures that they themselves can influence in their everyday operations.
A comprehensive culture change in the business can seem overwhelming, but doesn’t have to be difficult to achieve. To a large extent, it’s about minor adaptations and relevance for each individual function, department and employee. KPIs such as OTIF may seem meaningful on a strategic level, but perhaps less engaging for the warehouse staff. Everyone must play on the same team, speak the same language, and here it may be a good idea to break down the target numbers, so that they make sense to everyone.
Consider actions when defining this. Which action can the individual take, which can the business as a whole work on to strengthen the customer experience? What is needed for the departments to help each other rather than stand in the way?
When it comes to making transformation stick, cultural change is perhaps the most important piece of the puzzle. Eli Talberg, Global Logistics Manager of Protan emphasises the importance of realigning company and employee objectives to ensure all incentives and motivations at the time of transition.
After adopting Kinver's Engine infrastructure, they’ve defined a new framework for measuring the company's performance.