A Guide to KPI Development within the Grocery Industry
The Grocery Industry Supply Chain Committee's (GISCC) 1999 Tracking Study highlighted the general poor understanding, agreement and use of ECR-related Key Performance Indicators (KPIs) and scorecards at two levels.
- within individual companies
- between trading partners
A scorecard is the identification, definition and quantification of a set of KPIs that focus and drive desired behaviour to accord with what is being consistently measured both within and between trading partners.
The key issues were assessed to be the:
- inability to agree upon KPIs to be used, consistent and common definitions and
frequency of measurement.
- changing/redefining of performance measures tended to lag the development and
implementation of key initiatives; this has often resulted in the existence of long
standing, entrenched KPIs that incentivise behaviour inconsistent with new
business and trading arrangments.
- inability to routinely measure the important data elements that make up the KPIs, typically, transaction systems such as
warehouse management, order processing and so forth have not been able to provide the routine data set measurements
required to efficiently quantify the performance measures.
- general lack of preparedness, with some notable exceptions, for trading partners to share information with respect to the
performance measures with the view to seeking joint performance improvements.
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