How to Achieve Perfect Order in Supply Chain?
Perfect order rate plays a vital role in the supply chain and logistics companies
Ideally, the perfect order for the supply chain industry looks like this: Customers place orders successfully, goods are available in stock, and customers receive the goods they purchase in sound condition; companies deliver goods, return rates are at a low level, and companies receive payment for goods without a hitch.
However, this is what usually happens in real life:
- Jane, the receptionist of a company, orders a package of printer paper, but the order is not delivered on time. The logistics status shows that the goods have been in the nearby transit station for more than 24 hours;
- Tom of the production department was notified by the logistics company this morning that an overseas shipment of parts requires additional documentation before they can be successfully delivered;
- After placing an order for fabrics, May, the purchasing manager of a garment manufacturer, is informed by the raw material supplier that the raw materials are out of stock and the delivery will be delayed;
- ……
The supply chain industry is made up of numerous links. Process collaboration is the key and it determines if orders can be successfully delivered or not. The above scenarios will impact the business and eventually result in financial losses. Faced with these problems, how can supply chain companies effectively find key factors and make targeted improvements?
The Metrics for Supply Chain Perfect Order 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.
What is a perfect order?
A perfect order means that the order is fulfilled perfectly and that each step of the operation is performed in strict accordance with the commitments made to the customer throughout the order fulfillment cycle. The perfect order rate can be used to assess the effectiveness of a company’s overall supply chain performance. It measures how successfully and completely an order flow goes through all the stages: on-time shipment as per the order, on-time delivery, and timely and successful payment.
Kyligence Zen helps quickly analyze the perfect order rate
For the supply chain industry, they can use Kyligence Zen to create a metrics platform centering around the key metric of Perfect Orders Rate. Kyligence Zen is a one-stop shop metrics platform, you can click Kyligence Zen to start a free trial. The metric catalog provides a unified definition of the metric. Therefore, a trustworthy and functional metric is available to various departments for collaboration.
Note: As shown in the final section of this document, you can download the scenario dataset (CSV) and supply chain metrics template (YAML) used in this document, and import them from Kyligence Zen with one click to trial and reproduce the scenarios.
First, let’s take a look at the definition of the metric Perfect Orders. We filtered out perfect orders that meet the following conditions: advance delivery or on-time delivery orders; and orders with a status of complete or closed, which means that the orders have been paid for.
#Perfect Orders【Basic】
- name: Perfect Orders - Supply Chain
display_name: Perfect Orders - Supply Chain
description: Perfect Orders
datasource: supply_chain_management
type: basic
status: online
measure:
expressions: supply_chain_management.order_id
aggregation: count_distinct
return_type: int
dimensions:
order_date_year:
expressions: supply_chain_management.order_date_year
display_name: Order year
order_status:
expressions: supply_chain_management.order_status
display_name: Order status
delivery_status:
expressions: supply_chain_management.delivery_status
display_name: Delivery status
...
time_dimension:
order_date:
expressions: supply_chain_management.order_date
display_name: Order date
filters:
- operator: AND
conditions:
- member: delivery_status
operator: IN
values:
- Shipping on time
- Advance shipping
- member: order_status
operator: IN
values:
- COMPLETE
- CLOSEDBased on the basic metric of Perfect Orders, we can further create the composite metric of “Perfect Orders Rate”:
Expression: Perfect Orders / Total Orders * 100 %
The following is a snippet of the definition of the Perfect Orders Rate metric in YAML format, from which you can find that the expressions are the above calculation formula:
name: "Perfect Orders Rate - Supply Chain"
...
type: "COMPOSITE"
measure:
expressions: "${Perfect Orders - Supply Chain} / ${Total Orders - Supply Chain}"
...This completes the definition of the two metrics:
After completing the definition related to the metric of Perfect Orders Rate, we can further perform visual analysis in the metric analysis dashboard.
The dashboard above shows that:
Throughout the year, the on-time delivery rate is at a low level, ranging from 38% to 47%; the paid orders rate is around 50%; and the perfect orders rate is also at a low level, ranging from 16% to 26%.
By analyzing the correlation between the paid orders rate, the on-time delivery rate, and the perfect orders rate, we suggest further improving the on-time delivery rate, so as to increase the ratio of the perfect delivery rate, improve the customer satisfaction of the supply chain companies, and thus enhance the competitiveness and viability of companies.
Experience Kyligence Zen now
The Metrics for Supply Chain Perfect Order 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 1: 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.
