Some of the words that we commonly hear in meetings are KPI´s, Metrics and Indicators. But I am not so sure if people understand the real significance that they have and how crucial they are for the success of a company.
- How do you know that you are doing a good job managing your fleet?
- What is the factor of utilization of your vehicles?
- What is the cost per unit delivered?
- How efficient is your company regarding deliveries?
- How many deliveries do you make a day? How long do you take? What is your fulfillment rate of your deliveries?
- What indicators do you use to measure how you are managing your department?
Answering the above questions can be a good starting point to elaborate the KPIs you require to measure your performance, so you can show your boss that you are doing a good job. For this, you need to determine what you really want to measure and check if it is useful to increment the efficiency and productivity of your business, because not all that can be measure is actually 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, considering the whole supply chain (Inventory, Storage, Transport, Distribution, Customer service etc).
Measuring is important, but knowing how to do it correctly is decisive. Implementing KPIs that measure the efficiency on a simple scale is one of the biggest challenges that logistics managers face.
If it can be measured, it can be improved
Metrics helps to identify problems or situations that can be improved and provides information to take actions over them. They help us be more efficient, productive and improve our position against our competitors. The important thing is to be able to implement, monitor and evaluate on an ongoing basis.
What metrics do you use to evaluate the performance of your area? Let me know by leaving a comment below.
