Development of a comprehensive supply chain performance measurement system : a case study in the grocery retail industry

Abstract

While companies are looking for a single solution or a set of metrics that they can apply to measure their supply chain performance, it is clear that such a single solution does not exist. An effective supply chain performance measurement system has to align with a company's own supply chain processes. This thesis, based on the research of several established performance measurement models including the Balanced Scorecard and the SCOR Model, provides a framework for companies to build their supply chain performance measurement systems in-house. This thesis recommends a roadmap consisting of eight steps for companies to follow in the design and implementation phases of establishing a supply chain measurement system. The result is a set of 21 performance metrics is proposed that can be used by a company in the grocery retail industry to measure the efficiency of its supply chain. This metric set is well balanced because it encompasses six different criteria: comprehensive, causally oriented, vertically integrated, horizontally integrated, internally comparable, and useful. In conclusion, it is critical for companies from different industries to custom-tailor their own set of performance metrics, based on a careful evaluation of their individual business processes and supply chain performance objectives, that will allow management to do a better job utilizing existing capital resources and planning for strategic change and business development.