Performance — Its Meaning In the Supply-Chain

Jackson, Mick
September 2000
Logistics & Transport Focus;Sep2000, Vol. 2 Issue 7, p46
Trade Publication
It is the belief of the author of this article that key performance indicators (KPI) must rate as one of the most over-used and consequently often-abused terms in logistics. By putting KPIs into context as a strategic business tool for supply chain managers, this article aims to clear some of the misinterpretation and misuse. The three main groups active in the logistics arena with reference to KPIs are operators or carriers, shippers or supply chain managers, and national and European governments. Just as there are three categories of players, so there are three different focuses of interest. These are asset performance, service level achieved in the supply chain as a whole, and infrastructure performance. To have maximum utility for supply chain managers, KPIs have to reflect the relative service performance of individual modes used within a supply chain. This will allow the manager to determine the best modal combination for that supply chain. This article provides a strategic context for the use of KPIs by supply chain managers and puts a case for proactive government involvement in the development and dissemination of service-based KPIs.


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