The private trading exchange sets the stage for collaborative electronic
supply chain management. There are already existing private trading
exchanges that are catering to the basic requirements of buyers
and sellers. But the following basic service requirements of supply
chain management should also be addressed:
- Order cycle time
- Stock availability
- Order-size constraints
- Ordering convenience
- Frequency of delivery
- Delivery reliability
- Documentation quality
- Claims procedure
- Order completeness
- Technical support
- Order status information
Let us examine each of these in turn:
Order cycle time
This is the elapsed time from customer order to delivery. Standards
should be defined against customer's stated requirements.
Stock availability
This relates to the percentage of demand for a given line item
(stock keeping unit, or SKU) that can be met from available inventory.
Order-size constraints
More and more customers seek just-in-time deliveries of small
quantities. Do we have the flexibility to cope with the range
of customer demands likely to be placed upon us?
Ordering convenience
Are we accessible and easy to do business with? How are we seen
from the customers' viewpoint? Do our systems talk to their systems?
Frequency of delivery
A further manifestation of the move to just-in-time is that customers
require more frequent deliveries within closely specified time-windows.
Again it is flexibility of response that should be the basis for
the performance standard.
Delivery reliability
What proportion of total orders are delivered on time? It is a
reflection not just of delivery performance but also of stock
availability and order processing performance.
Documentation quality
What is the error rate on invoices, delivery notes and other customer
communications? Is the documentation "user friendly"?
A surprisingly large numbers of service failures are from this
source.
Claims procedure
What is the trend in claims? What are their causes? How quickly
do we deal with complaints and claims? Do we have procedures for
"service recovery"?
Order completeness
What proportion of orders do we delivery complete, i.e. no back-orders
or part shipments?
Technical support
What support do we provide customers with after the sale? If appropriate
do we have standards for call-out time and first-time fix rate
on repairs?
Order status information
Can we inform customers at any time on the status of their order?
Do we have "hot lines" or their equivalent? Do we have
procedures for informing customers of potential problems on stock
availability or delivery?
One should try to evaluate the service level of internet based
supply chain models and determine whether they are compliant to
these service standards.
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