In today's increasingly complex retail business environment, measuring the health and performance of a company's supply chain is critical to business success, both from a cost management and a customer satisfaction standpoint. Achieving the level of measurement and visibility required, however, is a challenge in itself.Common obstacles such as metric and key performance indicator (KPI) definition, cross-departmental alignment, and lack of end-to-end metric definition can cause many measurement programs to fall short of their charter.Using a standards based framework such as the Supply Chain Operations Reference (SCOR®) model from the Supply Chain Council can help retailers avoid many of these spans departmental functions to enforce alignment with obstacles, with an industry accepted metric hierarchy that corporate objectives.
As these supply chain complexities mount, so do supply chain breakdowns.What hasn't changed, however, is that most of these breakdowns are related to interdepartmental misalignment and miscommunication of goals, metrics, and KPIs.To oversimplify, the left hand knows not what the right hand is doing, which causes a problem the left foot thinks it can solve unbeknownst to the right foot, which has already applied its own band-aid. In this way,well-intentioned retail professionals operate in their vacuums, deal with massive amounts of data in their own ways, and use their own versions of "KPIs" to affect the measures under their immediate control. Despite their best efforts, department heads are unknowingly degrading supply chain accuracy and visibility. Poor visibility and inaccuracy make it difficult to discover new trends, address supply chain disruptions, and remodel supply chains for improvement.
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