Performance measurement and metrics in supply chains: an exploratory study

Abstract

Purpose

The purpose of this paper is to explore the approaches and metrics used to measure supply chain (SC) performance, and to understand the relative perceived importance of such measures.

Design/methodology/approach

This research is based on empirical data captured through a survey of SC professionals in a variety of business sectors.

Findings

The research confirms the importance of the balanced scorecard (BSC) approach, with BSC, SCOR and economic value added being the most commonly used tools. Economic metrics dominate, focused on cost and customer service. While social and environmental-related measures are of emerging importance, they appear to be of similar importance to economic metrics only when backed up by a legal obligation.

Research limitations/implications

The small sample of 51 companies was based on access and the group is not wholly representative of all businesses. Respondents were mainly managers from EU countries involved in procurement, logistics and transport activities. Surveyed companies included manufacturing, automotive, retail, logistics services and wholesaling businesses.

Practical implications

The common key performance indicators (KPI’s) are identified. These include measures related to: quality, efficiency, responsiveness, health and safety, employees, emission, natural resources utilisation, waste and recycling. Issues that influence the usage of measurement systems as well as the company and SC levels are ranked.

Social implications

Implementation of a monitoring system and subsequent usage of the collected data may help to reduce negative external impacts on society and the environment.

Originality/value

The field of SC performance management is still developing, with growing empirical work. Nevertheless this paper is one of the first attempts to carry out such an analysis focused on metrics and their usage. The survey instrument has been tested and can now be applied to other contexts.

Citation

Piotrowicz, W. and Cuthbertson, R. (2015), "Performance measurement and metrics in supply chains: an exploratory study", International Journal of Productivity and Performance Management, Vol. 64 No. 8, pp. 1068-1091. https://doi.org/10.1108/IJPPM-04-2014-0064