10 May 2017

Measuring Customer Service: Variety causing confusion?

The perfect method to measure customer service is to find out how your customer is measuring you. Over time organizational score cards evolved to negotiating tools between different functions rather than portraying the true performance of the company.

Again this is due to the fact that the accountability for metrics is not properly established. Customer service metrics may be considered the KPI for just the supply chain or even worse the Supply Planner or the customer service group….

I would like to get a broad survey input on which of the following measures you are using.  Please follow the linked-in discussion to post your comments on our Linked-in Group at https://www.linkedin.com/groups/1808515.

Different Measures for Fill Rates

Line Item Fill Rate = Number of Lines shipped in Full and On-Time / Total number of Lines ordered

On Time in Full = Number of Units shipped on Perfectly delivered Line items / Total quantity ordered (this could be weighted by cost)

Perfect Order = Number of Orders shipped in Full and On-Time / Total number of Orders

On Time Delivery = First shipment Rate = Number of Lines delivered on Time even if just one unit of the line is shipped / Total number of Lines

Partial Rate = A simple shipment ratio = Units shipped/Units ordered

Surprisingly a number of supply chains are just measuring the last one as their customer service which sadly happens to be the weakest of the metrics. Since this does not convey the whole picture, companies also supplement this with a variety of other metrics for timeliness and backorders etc.

What is your measure? Are you satisfied with how service is measured in your organization?

Please post your comments on the discussion at Linked-In Posting.

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