Question

What are common metrics used to measure supply chain performance?

Answer 1

Answer:

Time, cost and quality.

Explanation:

A supply chain is a network between a company and its suppliers to produce and distribute a specific product to the final buyer, its performance refers to the extended supply chain’s activities in meeting end-customer requirements, including product availability, on-time delivery, and all the necessary inventory and capacity in the supply chain to deliver that performance in a responsive manner. When selecting metrics to measure, there are characteristics that companies should look for, some of these characteristics are the facility to understand it, the relevance of the metric and how easy it is to collect the data obtained.

There are three common supply chain performance metrics:

• Time: these metrics are easily calculated and understood, and show operational effectiveness. For example, the level of on-time deliveries and receipts, time to process purchase orders, and time to fulfill an order.
• Cost: this metric shows how efficient parts of the company are, they can identify where improvements can be made. Inventory carrying costs is a popular performance metric that helps companies to understand how much it costs them to carry items in the warehouse.

• Quality: this metric helps improve customer satisfaction.

I hope you find this information useful and interesting! Good luck!