Concerns with Delivery Schedule Adherence

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Delivery Schedule Adherence (DSA) is a commonly used KPI within Supply Chain organizations. DSA results can identify a variety of issues from poorly performing suppliers whilst alluding to other issues such as overstocking to mitigate supply delays. As such DSA is a common theme in supply chain improvement programs (as case studies provided by Industry Forum and Taylor.com show) and forms part of the QCD core KPI’s (Quality, Cost and Delivery.)

However, it’s not without its problems. DSA is typically produced by calculating the ratio of shipments delivered to the specified location on the day indicated at time of order against those delivered late and or early.

For many organizations one of the most significant issues in calculating DSA is obtaining accurate data. Computer systems may not contain the relevant fields to store data preventing the KPI from being calculated. Where the data can be stored, ensuring that all buyers use the data fields correctly (and don’t modify the original forecast delivery dates.) can be a challenge. It is not uncommon during performance reviews for suppliers to have completely different DSA results. Data recorded to calculate DSA should be accurate and transparent (without interpretation) – leaving no one in any doubt about the robustness of results.

A variety of home grown process related problems may also exist. Commonly delays in stores specifically at goods receipt may generate delays resulting in incorrect DSA scores – ensuring that items are promptly processed may compensate but many organizations chose to apply a “buffer” (for example one day either side of expected delivery dates) to compensate for internal processing time.

Another common issue arises due to inconsistencies between the expectation of delivery between the buyer and seller. Clear communication is key to capturing accurate delivery forecasts this can be supported by ensuring that orders are placed within the validity period of the supplier quotation (which should stipulate the expected lead time) – and that order acknowledgements are analyzed appropriately in order to record correct lead time.

Whilst the importance of DSA is unquestioned, businesses as with any analysis, where there are issues the results are skewed and cannot be entirely be error free. Using incorrect DSA results as part of any supplier engagement or performance review can be embarrassing to say the least whilst potentially souring relationships. It should be remembered that DSA is a relatively simple metric however, a simple metric doesn’t always reflect the complexities of a supply chain and calculating DSA should be treated with care in order to generate accurate and usable results.