Essentials of Supply Chain Management, 5th Edition

CHAPTER 5Metrics for Measuring Supply Chain Performance

After reading this chapter you will be able to:

• Employ a useful model for assessing markets and the supply chains that support them;
• Define a concise set of metrics for measuring the performance of a company's supply chain operations;
• Discuss ways to collect and display supply chain performance data; and
• Use performance data to spotlight problems and opportunities.

Supply chains are fluid and are continuously adjusting to changes in supply and demand for the products they handle. To get the performance desired from supply chains requires a company to monitor and control its operations on a daily basis. This chapter introduces four performance categories that each supply chain participant should measure. It then discusses the performance metrics that can be used in each of these performance categories. The chapter also explores some of the technology that can be used to collect, store, and present performance data.

Useful Model of Markets and Their Supply Chains

A supply chain exists to support the market that it serves. To identify the performance that a supply chain should deliver, we need to evaluate the market being served. In support of this analysis we will employ a simple model. The model allows us to categorize a market and identify the requirements and opportunities that each kind of market presents to ...