October 2014 | Sponsored | Thought Leaders

Uncovering Value Through Performance Metrics

Tags: Supply Chain Management, Global Logistics, Customer Service

Kevin Hickey is Vice President, North American Customer Service, Maersk Line, 704-571-2696

Q: How do performance metrics aid a shipper in getting the most supply chain benefit from their containerized transportation providers?

A: Performance metrics help uncover value throughout global supply chains. When these metrics are used properly, value can be found in all areas and go much deeper than the typical price and vessel reliability data most commonly used. For a shipper to achieve maximum value from their carrier, dependable performance must exist from the most basic shipment transactions to final delivery at destination. For example, this would include items such as timely booking confirmations and accurate documentation. Taking into account transactional matters such as lost opportunities due to booking delays, and additional variable costs due to documentation amendments, provides a more complete evaluation. Measuring reliable performance throughout the supply chain enables shippers to assess their transportation provider in a more holistic approach. When visibility to these various facets of the supply chain come together, it enables a shipper to determine a carrier's total value.

Q: What is the impact of performance metrics on the shipper-carrier relationship?

A: Performance metrics that are specific, granular in nature, and shared on a regular basis stimulate dialogue between shippers and carriers. This collaboration strengthens the business relationship and creates a trusted partnership built on open communication. By maintaining an honest dialogue, specific improvement areas may be uncovered that will enhance supply chain success and the overall working relationship. Most importantly, determining what actions can be taken separately or jointly to improve outcomes further supports the value delivered. Collaborative relationships grow and change over time but can't continually improve if there isn't a common set of metrics that help to define the relationship and the performance of both parties.

Q: What is the impact of ongoing performance metric improvements?

A: Metrics are essential indicators of productivity and future success. Continually reviewing and improving key metrics enables shippers and carriers to build a constructive relationship and increase their respective opportunities to win in the marketplace. Whether it's reducing waste, capitalizing on new opportunities, or proper exception handling, all are critical components for any organization to regularly measure and enhance performance. At Maersk Line, we believe that our customers' success is dependent on their ability to deliver what they have promised. We support these promises with Customer Charter performance metrics that enable us to continuously offer end-to-end supply chain value and partnership that goes above and beyond standard metrics in the marketplace, such as vessel reliability.