Logistics Performance Indicators and Evaluation

  • Logistics Performance Indicators:

    • Productivity, economic, and quality indicators in logistics are essential.

  • Measuring and Evaluating Logistics Performance:

    • There is significant pressure to reduce costs within logistics systems and across supply chain participants.
    • No unified measurement system; companies determine how to evaluate logistics performance.
    • Common goals of measurement systems:
    • Cost-effective operations.
    • Growth and profitability.
    • Flexibility and maximum customer satisfaction.
    • Functions of logistics performance evaluation:
    • Inform: Facilitates decision-making.
    • Direct: Establishes principles and goals.
    • Control: Monitors changes retrospectively.

  • Logistics Indicators:

    • Analysis typically covers utilization, productivity, and efficiency.
    • Evaluation metrics are aligned with logistics functions.
    • Main goals of indicators:
    • Resolve conflicts among main logistics goals.
    • Clearly describe logistics objectives and domains of responsibility.
    • Early detection of deviations, opportunities, and risks.
    • Systematic identification of weak points and their causes.
    • Conclusions on rationalization opportunities.
    • Clear measurement of results across logistics areas.
    • Continuous support for routine logistics tasks.

  • Classification of Performance Indicators:

    • Measured Aspects:
    • Financial: costs, financing, liquidity.
    • Non-financial: quality, time (speed, flexibility), reliability, services.
    • Process Orientation:
    • Input (resources used)
    • Transformation (process)
    • Output (results)
    • Measurement Methods:
    • Objective (quantitative measurements)
    • Subjective (qualitative or opinion-based measurements)
    • Information Sources:
    • Internal and External (customers, suppliers, competitors).
    • Application of Indicators:
    • Reference and comparative basis.
    • Benchmarking approaches.
    • Analysis of interrelations without specific indicators.
    • Support decisions, evaluations, and feedback loops.

  • Goals and Role of Indicators:

    • Defined based on usage purpose, applicable to:
    • Specific logistics subsystems (e.g., raw material storage).
    • Individual operational units.
    • Overall enterprise level.
    • Initial development of structural indicators includes:
    • Magnitudes of tasks to be completed.
    • Capacity of personnel and resources.
    • Costs over the relevant period.

  • Levels of Performance Indicators:

    • Strategic: Overall supply chain throughput time; adaptability; supplier error rate.
    • Tactical: Order processing efficiency; capacity utilization; delivery performance metrics.
    • Operational: Specific productivity measures for workers and machines; quality control and delivery times.

  • Logistics Controlling Indicators:

    1. Base Indicators: Characterize volume and structure of logistics performance (e.g., delivered goods quantity).
    2. Productivity Indicators: Reflect on utilization of machines, tools, and workers (e.g., number of shipments per labor hours).
    3. Economic Indicators: Reflect logistics costs per performance unit.
    4. Quality Indicators: Characterize service levels, such as the rate of incomplete deliveries and frequency of damages.

  • Specific Areas of Logistics:

    • Purchasing Logistics: Focuses on counting orders, suppliers, order structures, and incoming shipment characteristics.
    • Indicators:
    1. Productivity metrics related to incoming shipments; productivity of receiving staff.
    2. Economic metrics such as average order costs and shipment handling costs.
    3. Quality metrics involving delivery waiting times, error rates, complaints percentages, and return rates.

  • Material Handling and Transportation Indicators:

    • Focus on productivity, economic, and quality indicators for in-house transportation logistics, relevant for both owned and contracted transport.

  • Distribution Logistics:

    • Key focus areas include customer number, average throughput per customer, distance between warehouse and customer, and distribution costs.
    • Indicators to measure productivity, economics, and quality within the distribution logistics realm encompass delivery time, cost per order, and fulfillment rates.

  • Establishing an Indicator System:

    • Customers require logistical performance, which incurs costs and resource commitment.
    • Logistics must achieve optimal performance at low costs.
    • Performance is measured against previous periods and planned targets.
    • Benchmarking involves comparing against other organizations' performance metrics.