Supply Chain
DIFOTAI – Delivered On Time (E)
How does customer service level influence the competitiveness and position in the market? Why and how the service level should be measured?
Posted: Dec 2011
Delivery "On Time"
Timely delivery makes impact to the business from several perspectives. Firstly, the delayed delivery can cause stock out at the sales outlet. Missing SKU from the shelf directly contributes to the loss of the business and opens the door to the competition.
Secondly, late delivery is creating customer’s dissatisfaction and ruins the company image. Nobody like the supplier that constantly fails to meet demand
Finally, late deliveries are creating potential threats, like loss of market share, additional distribution costs due to repeated deliveries and produce other "domino" effects. Timely delivery is the factor that influence overall DIFOTAI
- CHART – (take from Management Roles article )
"On Time" Positive Impacts factors
Delivery in time positively is positively impacted by:
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Discipline in order transmission ( system & human factor )
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Discipline in order transmission ( be careful on correct delivery date creation and respect of the agreed timing for delivery date)
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Better Credit Management (review credit limit, timing cash collection communication, reporting created to monitor out of standard situations)
"On Time" Negative Impacts factors
Delayed delivery is caused by:
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Orders received after agreed time
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Wrong lead time for that cluster or wrong day (ie. Sunday, bank holiday)
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Wrong delivery date vs to the agreed delivery day for a specific area
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Trucks availability (ie. Season or month end peaks)
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Credit hold
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Product availability
Improving "On Time" delivery
Timely delivery is expected by the customer, therefore it requires the attention to the following elements:
Related Reading:
DIFOTAI - Delivered In Full On Time Accurately Invoiced
DIFOTAI - Delivery In Full
DIFOTAI - Delivery On Time
DIFOTAI - Deliver Accurately Invoiced
