Having the right logistics strategy is essential for organizations that are committed to process improvement, cost savings, increased customer satisfaction, and increased profits. The top tip for an organization looking to create an effective logistics strategy is to determine which key performance indicators (KPIs) are most important to its strategy. The organization can then define and implement systems for measuring the KPIs in its logistics operations. Measuring logistics operations helps organizations to identify, quantify, and focus on areas of improvement.
APQC has found that KPIs can help organizations drive process improvements where needed. It is important for organizations to have a balanced scorecard of key performance indicators so that they have a complete picture of their logistics performance. APQC recommends tracking KPIs in the following areas: cost effectiveness, cycle time, and process efficiency. Below is a list of some logistics KPIs organizations should consider when creating a logistics strategy.