Study with over 100 logistics experts
The logistics landscape for manufacturing and trading companies is evolving faster than ever. Increasingly global supply chains are driving complexity, which is further amplified by external factors such as the COVID-19 pandemic and labor shortages. We decided it was time to shed some light on the situation:
How can logistics be managed more strategically? Which KPIs are required for this? And what are the biggest levers that can be pulled in operational logistics, site management, and at the executive level?
Together with Prof. Dr. Franz Vallée of Vallée & Partner, we surveyed over 100 logistics decision-makers in the DACH region on these very topics and summarized our findings in the TradeLink KPI Study 2021.
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This article focuses primarily on KPIs for strategic logistics management and is therefore aimed at logistics managers and executives. You can find all the KPIs for the other areas mentioned in our study, which is available for free download.
Delivery quality over costs
Since the COVID-19 pandemic at the latest, manufacturing and trading companies have once again recognized their logistics as a central value driver. This has opened up several factors that operational management and executive leadership can use to optimize their company's logistics.
In preliminary discussions, we identified several factors such as maximum delivery quality, total costs, cost efficiency, and warehouse throughput time.
Our study revealed that achieving maximum delivery quality is the top priority for logistics decision-makers in the DACH region, cited by nearly 44%.
Delivery quality is defined as the ratio of the number of rejected deliveries to total deliveries . A complaint is filed if the delivery does not arrive at the ramp on time or in full (see also DIFOT - delivered in full on time).
The result is particularly interesting because it shows that logistics managers see more value in optimizing delivery quality than in reducing their process costs.
No management without metrics
To strategically manage internal and external logistics processes, you need access to up-to-date, real-time metrics, which can only be guaranteed through structured data in cloud solutions. This is the only way to ensure, for example, that delivery quality per delivery partner is calculated accurately and is available at any time.
Unfortunately, especially in logistics, it is still common practice today for data to be stored in an unstructured (e.g., Excel, email, and handwritten notes) and decentralized manner. Our study underscored this once again, as when asked whether the 100+ logistics decision-makers had the metrics relevant to their management available at all times, over 70% answered with a clear no.
Only 7% were able to answer the question with a clear yes, which once again very clearly illustrates the current state of supply chain visibility. This also aligns with our experience in the market when we talk to companies about transparency in their supply chain.
Paper, Excel & time slot management
Most companies still maintain the status of their incoming goods on paper, often with handwritten notes directly on the delivery note. To determine metrics such as delivery quality based on this, projects involving several employees often take days to digitize the data and assign it to the suppliers.
Especially in contract logistics Excel spreadsheets are used to track deliveries. Since this data is at least digital, it still has to be manually reconciled with the remaining data, such as delivery notes (as PDFs or in paper form) or orders (often in the ERP system). This also requires dedicated projects, which unfortunately rules out quick access to important metrics.
Time slot management software often only maps the delivery and the necessary time and dock, but not the other criteria of delivery quality or other metrics important for strategic logistics management. As a result, time slot management tools are also not optimally suited for creating important analyses and reports, as key data points are missing.
Supply chain collaboration as the key to success
The only type of software that enables seamless supply chain transparency and analytics at the touch of a button is collaboration tools like TradeLink.
TradeLink makes it possible to assign all deliveries from the moment an order is announced and tracks all relevant data points directly within the platform. This enables real-time analytics and reporting at the touch of a button, facilitating optimal strategic management of site logistics.
Download the study now
In our study, we have examined many other metrics, such as those important for managing operational site logistics. You are welcome to download the study free of charge.
