explain the importance of developing metrics and kpis in logistics and supply chain operations

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Primary Task Response: Within the Discussion Board area, write 400-600 words that respond to the following questions with your thoughts, ideas, and comments. Be substantive and clear, and use examples to reinforce your ideas.

Key Assignment

  • Explain the importance of developing metrics and KPIs in logistics and supply chain operations.*******
  • Explain what metrics indicate and how they can benefit an organization. *******

******Provide citations and references to support your discussion.

Responses to Other Students: (SEE POSTS BELOW) Respond to at least 2 of your fellow classmates with a reply of 100-200 words about their Primary Task Response regarding items you found to be compelling and enlightening. Use the following to guide you in your responses:

  • Discuss the pros and cons of each technique discussed.
  • Would you utilize it in your current of future place of employment? Provide justification for why or why not.

PEER RESPONSES:

.1. Katherina

The importance of developing metrics and KPIs in logistics and supply chain operations is very crucial for the success of the company which is the reason why it is discussed all the time in meetings as it determines the company’s feedback based on their ratings. It gives you an incite of your performance on managing you fleet, the utilization factor if you vehicles, the delivered cost per unit, the company ’s efficiency concerning dispatch and distributions and also the fulfillment rates.

The metrics helps to identify problems or situations that can be improved and provides information to take actions over them. If it can be measured it can be improved. It helps us be more efficient, productive and improve our position against our competitors. One of the main thing is the ability to implement, monitor and evaluate with consistency.

The KPIs you require to measure your performance to prove your productivity and proficiency. You basically have to determine what you really want to measure and check if it is useful to increment the efficiency and productivity of your business because all that can be measured may not actually be useful. One of the key issues of an organization is to implement systems that can deliver indicators of the performance that are held both internally and externally, as you consider the entire supply chain. For example the inventory, storage, transport, distribution and customer service.

In addition, the supply chain performance metric gives a different view of the supply chain. The important decision for all businesses or organizations is to verify and allocate which supply chain metrics are most important and how they can be utilized. Many companies use supply chain performance metrics that are easy to calculate but may not necessarily give a true indication of how the supply chain is performing. Sometimes companies use different metrics for their logistics department to apply, however other parts of the supply chain may be negatively impacted.

Companies have to be mindful of their selection of metrics for department to adhere to in order for positive and successful feedback.

As stated metrics indicate success when it is understandable, quantity which is expressed by a value that is objective derived from accurate data and not subjective. Measures the main importance of the data. Also consuming to collect and may require time to be taken away from line staff to prepare. This can be counterproductive therefore these types of metrics should be avoided. It is beneficial for the company because it causes correct behavior and improvement within employees and departments.

References :

CTU resources unit 3 retrieved from https://class.ctuonline.edu/_layouts/MUSEViewer/As…


2. Alyssa

The importance of developing metrics and KPIs in logistics and supply chain operations is very important for day to day operations of any company. If you do not use these metrics and KPIs then it would make it very difficult to keep up with how the company is performing. KPIs immediately give you feedback and shows you what may be going wrong. Getting answers like this will make it easier for you to address a situation before it gets beyond your control. This helps the company to provide the consistency they want their company to have and show to their customers. Now some of the things that the KPI measures are not necessarily important, so you have to make sure to eliminate the items that you do not need for your company. Otherwise these categories can take up space and possibly give you incorrect information because of the information being put together. The supply chain performance is important because it helps you to really see how the company is doing and then uses different metrics to figure out what may need to be fixed or changed. Once you get those particular things fixed or changed then it will help the company to grow and produce better results. You have to keep testing different things with different metrics because different metrics could come up with different results. So you have to make sure that the results you are getting are accurate. This also helps to let you know if one metric says something is wrong but another metric says it has to be like this for a different aspect to work, then from there, the company can decide which one is more important and what they would rather have ding so well. Now there are some metrics that can stop production, so you want to make sure to stay away from those metrics, otherwise you could lose out on money.

 
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