In a study published in CSCMP Supply Chain Management Quarterly, the authors report the results of a survey that examined whether operational metrics in distribution centers (DCs) are aligned with corporate strategy in various companies. The study combined 2,467 respondents who participated in the survey over the past five years into a single data set, and after considering all respondents who answered questions pertaining to strategy and metrics used a sample of 420 respondents.
The results are as follows:
The authors state, "Our data set reveals that first, there is not a lot of agreement within a strategy group on what are the important metrics to use, and second, that there is no difference between strategy groups in their lists of the most important metrics—both of which are the opposite of what you would expect. It seems that regardless of strategy, most logistics organizations are not differentiating their performance on the basis of the metrics they utilize to manage their operations or compare themselves with others in the industry. Managers would be hard-pressed to find where strategic choices have made operational differences in the DC."
A five step approach was suggested to address this issue:
Step 1. Clearly articulate the objective(s) to be met.
Step 2. Develop Validating the Value-Add statements.
Step 3. Measure the progress.
Step 4. Find the underlying problem.
Step 5. Take action to fix the problem.
Source: Donnie Williams Jr., Joseph Tillman, Karl Manrodt. 2015. Disconnected in the DC: The missing link between metrics and strategy. CSCMP Supply Chain Quarterly, Q4/2015.