Find out Why Your Order is Delivered Late. It’s that simple!
“Information black hole” makes it difficult to locate the root cause
Ray, the head of the Data Analytics Department at a supply chain company, recently encountered a problem — The company had encountered significant amount of delayed orders, increasing of customer complaints, and loss of long-term customers. As we all know, the supply chain is a closed-loop chain, consisting of raw materials -> manufacturers -> suppliers -> channels -> end users, as well as production, procurement/sales, inventory, logistics, consumption, and other aspects. Therefore, the key task and goal for Ray in the near future is to identify the root cause of the problem, collaborate with the other departments to optimise and improve the processes, and improve the overall efficiency of the supply chain.
Quickly identifying factors that affect the on-time delivery rate
After some analysis, Ray, the Data Analytics Manager, reached the conclusion that the on-time delivery rate of orders was the key to the company’s overall supply chain performance. As a result, Ray decided to do some On-Time Delivery Rate metric. Let’s follow Ray to see how Kyligence Zen, a SaaS-based metrics management platform on the cloud, can help analyse the key supply chain metric of On-Time Delivery Rate, identify the key factors affecting the overall efficiency of the supply chain, and then facilitate decision-making and optimisation by the management to improve the overall efficiency of the supply chain.
The Metrics for Supply Chain On-Time Delivery Rate Correlation Factor Analysis have been published in Kyligence Zen Metrics Template market. You may click the link and reproduce the use case in your own Kyligence Zen account.
Firstly, in the metrics catalog on the Kyligence Zen, Ray defined the key metric On-Time Delivery Rate as follows:
On-Time Delivery Rate metric = Number of On-Time Delivery Orders / Total Orders * 100%
On the metrics definition page, Ray can analyse by dimensions such as order date, order shipping level, etc. We can also create visual charts such as bar charts, line charts, etc.
In addition, Ray defined metrics such as Delayed Delivery Rate and Canceled Shipping Rate for comparison with the On-Time Delivery Rate metric:
Secondly, based on the key metrics defined above, Ray further visualised them in a dashboard and presented and reported the results of the metrics analysis at the company’s management meeting.
Using the 3 charts (see below), Ray conducted correlation analysis on On-Time Delivery Rate, Delayed Delivery Rate and other metrics based on different factors, and reached the following conclusions:
1. As the number of days for picking increases, the delayed delivery rate of orders also increases. When the number of days for picking >= 3 days, the delayed delivery rate of orders rises to 59% and reaches 95% when the number of days for picking is 4.
The number of days for picking has a direct impact on the on-time delivery rate and, ultimately, on the efficiency of the entire supply chain. To improve the on-time delivery rate of orders, Ray recommended that the company’s Warehousing Department improve the efficiency of warehouse picking.
2. When the number of actual days for shipment >= 5, the delayed delivery rate of orders exceeds 95%. In this case, the orders are not delivered on time and customer satisfaction is bound to be affected, which can also directly lead to customer loss.
3. For the different order shipping levels, it can be found that the on-time delivery rates are, in descending order, Standard Class > Same Day > Second Class > First Class. In the Second Class, the on-time delivery rate is only about 18%; while the delayed delivery rate of the First Class is as high as 99%. By comparing the different shipping levels, Ray recommended that the company’s management push the Logistics Department to optimise the delivery efficiency of the first and second classes of shipping levels as soon as possible, to effectively improve the on-time delivery rate of orders.
Experience Kyligence Zen now
The above process is a demonstration of how Kyligence Zen can effectively help supply chain companies’ data departments and management with metrics analysis and decision making. Kyligence Zen provides supply chain metrics templates for instant experience with On-Time Delivery Rate and other related metrics. Try it now!
The Metrics for Supply Chain On-Time Delivery Rate Correlation Factor Analysis have been published in Kyligence Zen Metrics Template market. You may click the link and reproduce the use case in your own Kyligence Zen account.
Note : The dataset is from Kaggle, with Shashwat Tiwari as the author. Some columns of the data used in this article are adjusted on the basis of the original dataset.
