Deliverable Length – 400 to
This assignment is all about metrics!!
Remember that the word metrics simply means measures, or
For this assignment you need to use your current or prior
place of work, or some business that is regularly in the news, to complete the
some of the logistics activities that the business is engaged in.
Keep in mind that while ALL businesses engage in some form
of logistics, each business or industry has their own set of activities that
are unique to that industry.
In other words the logistics activities of an airline would
be different than for a factory, restaurant, hotel, etc. so you need to be specific
and explain your thoughts.
• Explain what metrics should be used to
assess how effective the logistics function is that would be important to
customers. For example, the “percent
of on time arrival and departure” would be important to an airline passenger
but the “percent of absenteeism” would not be important to a customer but may
be important to an internal stakeholder.
metrics should be used to assess how effective the logistics function is that
would be important to internal
Internal stakeholders refer to the owners,
stockholders, and senior management team.
They are more concerned about costs, profits, and market share.
As a result, the metrics needed to satisfy this group would
be different than for the customer group.
you pick those metrics?
In other words, you will need to explain why you selected
the metrics that you did for both the customer group and the internal
Let’s look at some examples.
airline might have the following metrics:
- % of downtime of airplanes
- Average repair time
- % of arrivals and departures on time
- % of planes NOT cleaned
- % of planes NOT loaded with catering needs
- % of lost baggage
- % of flights with 100% seating capacity (full flight)
example of the steel mill industry:
- Costs of inbound freight for raw materials
- % of on time shipments received
- Outbound shipping costs
- % of on time shipping to customers
- % of added costs for premium freight caused by the firm’s
choice of metrics to use is important.
IF a wrong or unimportant metric is chosen, and the
organization focused resources and effort on excelling at that metric, time and
money could be wasted.
This is why it is important to use metrics that satisfy both
of the groups in an organization; that is, the customers and the internal
a single metric can satisfy both groups, although this is not always the case.
For example, on time departure of an airline satisfies both
the customers who are happy with an on time departure and the internal
It satisfies the internal stakeholders because IF the flight
is cancelled or significantly delayed, the airline might need to pay for hotels
for the stranded passengers thereby incurring additional costs.
to clearly specify the company that you are using and the industry that they
belong to since your metrics need to specifically tie in to that industry’s
In other words, the metrics that you are creating need to
tie in to your particular industry since each industry has their own unique
needs and goals.