By Pollen Consulting Group founder and CEO Paul Eastwood.
DIFOT (delivery in full on time) is a common measure for customer service. It is notoriously known for getting you on the naughty list, and is ultimately a great lag indicator for understanding if a business is running well.
Retailers or customers often get caught short with this indicator as when it goes wrong the knock-on effects are time-consuming and normally involve firefighting each day to resolve, eating into time spent for other priorities.
In the FMCG sector 98.5% is seen as a good number yet is the make up of the 1.5% that is important? Is it 99 out of every 100 boxes arrive on time, in full, every day, or is it for four days each year no product arrives at all?
Whether we are talking about 98.5%, 85% or 0% for a day, the problem is the costs of response and the losses incurred. Consider root cause and the real reason comes back to the reactivity that will always exist using a lag indicator to drive a live decision. In other words, knowing ahead of time allows better decision making and optimisation.
It’s time to throw DIFOT out and bring in POOF (predicted on-time order fulfilment). Smart analytics and planning systems should be providing you a predictive number, allow suppliers to flag potential risk ahead of time and manage the supply chain to optimise for all.
At Pollen, we have been working with a number of clients in this space; the secret ingredient is a smart scheduling/planning system that can predict and plan the future in a live/connected environment.
This is done through a small number of critical insights running on a powerful platform;
- Connected to live raw materials and inbound plan (with live delivery dates)
- Production schedules running from live factory performance data (including major downtime events)
- Live demand from customers consuming live stocks (super smart systems would be connect ed to downstream demand and stock levels – that is a whole other topic!)
- Using risk-based models to show not single outcomes but the most probable range.
The above is not using thousands of data points, just a few critical control points to allow you to predict order fulfilment and therefore be on the front foot with customers to remove the pain point of looking back at customer service.
Reach out to discuss more – it’s time you stopped surprising your customers without going POOF!
About Paul Eastwood
Paul Eastwood is founder and CEO of Pollen Consulting Group. Paul is a straight talker with a wealth of industry knowledge and over 16 years’ experience working with a vast range of global and local FMCG businesses. He has a passion for operations and simplifying supply chains and is happiest when problem solving and getting his hands dirty on the factory floor.
About Pollen Consulting Group
Pollen is ‘a management consultancy with a difference’ driving bottom-line performance by creating value through end-to-end supply chain transformation. With credentials to cover every element of a COO’s remit, our skillset is founded with operational bias, specialising in manufacturing excellence, supply chain efficiency, lean training, engineering, technology solutions, capital investment and procurement.