Supply Chain Management: A Recommended Performance Measurement Scorecard

Abstract : Supply chain management is the management of all processes or functions to satisfy a customer's order (from raw materials through conversion and manufacture through shipment). Performance measures, or metrics, are used to monitor the progress of supply chain initiatives. However, a consensus in DoD considers the metrics available to senior DoD managers to be inadequate or lacking the depth to measure the effectiveness of the DoD supply chain. The metrics are not balanced across customer service, cost, readiness, and sustainability performance objectives. Because of the lack of adequate measures, the Deputy Under Secretary of Defense (logistics) tasked Logistics Management Institute (LMI) to propose a set of balanced performance measures that senior decision-makers can use to monitor supply chain effectiveness. This report addresses the recommended top-level, or enterprise-level, performance measures. Enterprise metrics measure the overall performance of the supply chain and are cross-functional.