.: PERFORMANCE MEASUREMENT IN A SUPPLY CHAIN :.

BY F.T.S. CHAN.

PRESENTED BY..
PRATIK MANWAR
ROHIT BHARGAVA
RUPAL KADIAN
NITIN TRIPATHI
TUSHAR SHUKLA

PERFORMANCE MEASUREMENT IN A
1
SUPPLY CHAIN
 INTRODUCTION..

•Supply chain is an important element in logistics development for all industries.

• Improves efficiency & effectiveness.

•No systematic grouping of different performance measures(PMs) yet.

•Formulation of both qualitative & quantitative PMs.(According to BEAMON)

•Outlines the application & pairwise comparison – helps in identifying importance of

different PMs.

•Covers common PMs- cost & quality.

•Other major PMs- resource utilization, flexibility, visibility, trust & innovation.

PERFORMANCE MEASUREMENT IN A
2
SUPPLY CHAIN
PERFORMANCE MEASUREMENT IN A
3
SUPPLY CHAIN
MORE..

•Customer satisfaction level is an indication of the required standard of service level of a

particular company, which is closely related to the whole performance of its supply chain.

•The weighting of each performance measurement can be different for each industry.

•A multi-attribute decision-making technique, called an analytic hierarchy process (AHP) can

help to reduce the complication.

•Sink and Tuttle claim that you cannot manage what you cannot measure.

•Plays a critical role in monitoring performance, enhancing motivation and communication,

and diagnosing problems.

•Accurate performance measurement is helpful in the improvement of SCM.

PERFORMANCE MEASUREMENT IN A
4
SUPPLY CHAIN
DEFECTS IN SUPPLY CHAIN..

There are some in-depth problems of PMSs in the supply chain context:

• The lack of a balanced approach to integrating financial and non-financial

measures.

• The lack of system thinking, in which a supply chain must be viewed as a

whole entity and the measurement system should span the entire supply chain.

• The loss of the supply chain context.

PERFORMANCE MEASUREMENT IN A
5
SUPPLY CHAIN
QUANTATIVE MEASURES..

•Cost

•Distribution Cost.
•Manufacturing Cost.
•Inventory Cost.
•Warehouse Cost.
•Incentive Cost & Subsidy.
•Intangible Cost.
•Overhead Cost.
•Sensitivity to Long term Cost.

•Resource Utilization

•Labour, Machine, Capacity, Energy Resource Utilization.

PERFORMANCE MEASUREMENT IN A
6
SUPPLY CHAIN
QUALITATIVE MEASURES..

•Quality

•Customer Dissatisfaction

•Customer Response Time

•Lead Time

•On Time Delivery

•Fill Rate

•Stock Out Probability

•Accuracy

PERFORMANCE MEASUREMENT IN A
7
SUPPLY CHAIN
CONTD…

•Flexibility
•Input : Labour, Machine.
•Process : Material Handling, Routing, Operation.
•Output : Volume, Mix, Delivery.
•Improvement : Modification, New product, Expansion.

•Visibility
•Time, Accuracy

•Trust
• Consistency

•Innovativeness
•Launch of new product
•Use of new technology

PERFORMANCE MEASUREMENT IN A
8
SUPPLY CHAIN
ANALYTICAL HIERARCHY PROCESS..

•To obtain the best and most optimum supply chain for different industries is very
difficult.

•Because the importance of each performance measure is different in various industries.

•Thus weights have to be assigned to each performance measure according to its

contribution to the performance of a given supply chain.

•The AHP is a commonly used tool for solving multi-criteria decision-making problems,
developed by Saaty.

•It consists of three steps:

• Decomposing the complex problem into a hierarchy of different level of elements.
• Using a measurement methodology to establish priorities among the elements.
• Synthesising the priorities of elements to establish the final decision.

PERFORMANCE MEASUREMENT IN A
9
SUPPLY CHAIN
APPLICATION OF AHP..

•As per the example of Electronic Industry taken into account findings are
actually a research work which will eventually differ from Industry to industry.

•Henceforth the findings for each industry will be exclusive in nature and can
not be implemented in detail to another industry.

•Here AHP actually helps us in finding best suited supply chain system for any
industry specific under given research head because each industry will have its
own SWAT analysis.

•AHP is a hierarchical process that gives according weight to the factors of

supply chain which in turn results in an actual application of desired supply
chain to industry specific as per its face.

PERFORMANCE MEASUREMENT IN A
10
SUPPLY CHAIN
CONCLUSION..

•Different supply chains are different for various industries.

•Emphasizing more on cost part in supply chain should be avoided.

•Customer should be awarded with more priority in turn pampered with more
benefits.

•Quality should be maintained at any & every point of supply chain.

•AHP is an important decision making technique that results in choosing

optimal supply chain for any & every industry.

PERFORMANCE MEASUREMENT IN A
11
SUPPLY CHAIN
.: || THANK _YOU || :.

NO QUERIES PLEASE……
PERFORMANCE MEASUREMENT IN A
12
SUPPLY CHAIN