Strategic Supply Chain Management - Supply Chain Online

198 Strategic Supply Chain Management
FIGURE 5–3
Typical supply chain scorecard.
Key
Perspectives
Customer-
Facing
Metrics
Internal-
Facing
Metrics
Metric
On-Time Delivery
to Request %
On-Time Delivery
to Commit %
Order Fulfillment
Lead Time
(OFLT): Primary
Manufacturing
Strategy (days)
Upside Production
Flexibility: Principal
Constraint (days)
Total Supply Chain
Management Costs
(% of revenue)
Total Returns
Processing Costs
(% of revenue)
Inventory Days
of Supply
Cash-to-Cash
Cycle Time (days)
Net Asset
Turns
Your Organization
Performance Versus Comparison Population
0–20%
Major 20–40%
Opportunity Disadvantage
40–60%
Median
82.1%
91.1%
7.9
49.0
10.3%
0.9%
64.2
76.3
2.0
60–80%
Advantage
© Copyright 2004 The Performance Measurement Group, LLC
60–100%
Best-in-Class
97.3% x
99.2%
2.4
5.5
4.7%
0.2%
23.6
22.3
9.1
Your
Org.
96.3%
92.8%
11.0
25.0
6.9%
66.6%
39.0
43.6
5.9
We noted earlier that a balanced set of metrics is critical to an effective
performance-management program. The same is true for performance
targets. While optimizing supply chain performance isn’t a zero-sum
game—a performance improvement in one area doesn’t have to be at the
expense of another—it’s true that to reach a target in one big area, you
might have to accept a lower metric in another.
It’s also true that you can improve the performance of numerous
parts without improving the performance of the whole—an idea that can
be hard for companies to grasp. Sometimes compromises at the functional