Analysis on Influencing Factors of Logistics Enterprise Performance

Current situation and construction scheme of performance management in logistics enterprises

2005-11-814: 09: 34 The author enjoys the internet.

World-class companies have deviated from the method of measuring logistics performance by analyzing simple functional indicators. They always formulate and deploy logistics strategies from the perspective of the company as a whole and the supply chain, measure and control logistics performance through the performance of the company in the channel alliance, and supervise the distribution of logistics resources.

First, performance management and domestic status analysis

1, the definition of performance management: As the name implies, performance management is to solve the problem of making intangible assets effectively create value, aiming at the management of knowledge, skills and people. Performance management is not only a typical enterprise human resource management problem, but also a very important organic part of enterprise strategic management.

Performance management emphasizes the monitoring of the process, and ensures the realization of strategic objectives through the observation and evaluation of various indicators in the process of action. Not management based on objectives, but management based on facts. Therefore, with the emergence of performance management, enterprise strategy is no longer the task of a few people at the decision-making level, but a matter from CEO to every employee.

2. Conceptual framework of performance management: At present, the widely used performance management framework is mainly key performance indicators (KPI). Balanced Scorecard (BSC) is not widely used in China, especially in logistics and logistics-related enterprises in China.

The essence of KPI is to point out that the setting of enterprise performance indicators must be linked with enterprise strategy, and the meaning of the word "key" refers to the most important problem to be solved in a certain stage of enterprise strategy. For example, in an enterprise with extraordinary growth, the rapid growth of business has brought about the rapid expansion of organizational structure, the expansion of staff, the shortage of management and skills, and the imperfection of processes and norms have become the main problems that restrict enterprises from effectively coping with high growth. Solving these problems has become the key point of strategic significance for enterprises at this stage, and the performance management system must design management indicators to solve these problems accordingly.

According to Herzberg's "incentive-health care" theory, we can divide the existing KPI indicators into coordination, control and incentive. The coordination and control part refers to the direct interaction between the top management and the department (including the rigor of the process, the allocation of time, the management focus, etc.). ), generally including "human resources plan/process", "financial control and plan/process" and "operational control and plan/process", which can be directly measured by evaluation results; And "reward", "opportunity" and "values and beliefs" belong to the incentive part, which refers to the clear incentive measures taken by the senior management to motivate the overall management team, and it is generally not easy to evaluate.

3. At present, the performance management objectives of China logistics enterprises are weak, with little feedback, and there is basically no reward and punishment management. China logistics enterprises have a strong correct concept of the mission and organizational structure of enterprises, but they are more keen on using the two levers of operational control and financial control to control and coordinate performance, and rely more on value demands to motivate employees.

Therefore, enterprises often rely heavily on the promotion of corporate values (such as "becoming an industry leader" and "being loyal to the enterprise"), which is manifested in the form of hanging photos and slogans of leaders and singing company songs to create an atmosphere to motivate employees, while rarely using the strategy-based performance management system commonly used by American enterprises.

China logistics enterprises are obviously poor in management ability and strictness, especially in the following aspects: (1) setting goals; Provide clear performance management feedback; Implement real rewards and punishments for excellent/poor performance; Over-reliance on business control and value incentives; Lack of savvy and mature managers who are proficient in finance; Incentive mechanism/development opportunities are rarely used to attract/retain excellent employees, and they may fail in the "talent war".

Second, the method of improving management and its operation

According to the organizational setup of logistics enterprises in China, the orientation of logistics organization and the best practices of foreign logistics companies, the management of logistics performance is best based on the logistics capability, the sensitivity analysis of supply chain cost and end customer satisfaction, and the performance evaluation of the company in the logistics department. The specific KPI measurement system can be composed of two parts: supply chain logistics capability evaluation and company logistics performance evaluation.

1, supply chain KPI setting

1) Supply chain unification: strive to unify and coordinate the operation of supply chain and the satisfaction of end customers, require logistics to be single-minded, share benefits, and emphasize the connection of logistics channels;

2) Information technology: Information technology is the application of hardware, software and network to promote the improvement of logistics informatization, emphasizing variability and integration.

3) Information sharing: Information sharing is the desire to exchange logistics strategic and tactical data between functional departments and supply chain partners, emphasizing the form and proportion of logistics and financial information sharing.

4) Contact: Contact is about the ability of information exchange and application.

5) Standardization: Standardization is about constantly looking for the ability to apply logistics practices in organizations, and the demand is consistent with industry standards.

6) Simplification: Reduce the complexity of logistics processes and relationships.

7) Rules: achieve high standardization and simplification, and pursue the same operating principles and procedures.

2, the company logistics performance appraisal

1) Logistics cost assessment: After the logistics department becomes a profit center independently, the logistics cost assessment is directly linked to the product division or sales department to assess the logistics costs incurred by the product division or sales department. The most direct measure of a company's logistics performance is the logistics cost rate.

Logistics cost rate. Logistics cost rate = annual total material cost/annual sales. The logistics cost here is the real cost of completing a specific logistics activity. The logistics costs included by enterprises are transportation costs and operating costs of distribution centers. Because there is no standard statistics and cost division, many hidden logistics costs are classified as production costs and sales costs. Scientific logistics cost should be based on logistics activities, and all costs related to completing logistics functions should be included in activity-based cost classification.

Typical logistics costs can be divided into transportation costs and inventory costs.

Logistics cost statistics:

A transportation fee and insurance premium: transportation fee, factory-to-customer freight, factory-to-distribution center short barge fee, factory-to-distribution center long-distance transfer fee, distribution center-to-customer delivery fee, various railway freight and miscellaneous fees, and cargo insurance premium.

B Inventory cost: out-of-stock cost (generally calculated as 25% of the cost of developing a customer), inventory capital occupation (finished products and raw materials), depreciation of logistics equipment, loss of expired products, storage insurance premium, warehouse labor cost, storage rent, inventory tax, handling fee and packaging fee.

2) Inventory turnover rate:

Inventory turnover rate = annual sales/average inventory level

The higher the inventory turnover rate, the better the product sales and the less the funds occupied by the inventory. Taking food enterprises as an example, according to the sales data and inventory data of domestic food enterprises in 2002, the current inventory turnover rate of enterprises is about 50%, which has reached a high turnover level. In the future organization, the main appraisal object of inventory turnover rate should be the product department.

3) Customer service level

Customer service level is mainly aimed at the evaluation index of product division or sales department.

Order satisfaction rate: order satisfaction rate = the number of times the existing inventory can satisfy the order/the total number of customer orders, that is, the ratio of the existing inventory to satisfy the commodity orders required by the customer orders. The inventory of each distribution center should reach 95% satisfaction rate. However, it is difficult to achieve this ratio when the distribution center replenishes the inventory by transferring goods. According to the investigation conclusion of Meizhi Company, the average inventory availability rate in East China is only 80%, which has been running well in all regions, and the average inventory availability rate in West China is even less than 50%.

Consistency between order and delivery: Consistency between order and delivery is considered to be the most important factor in production enterprises and service enterprises. The main operating index is error-free delivery rate.

Error-free delivery rate = the number of deliveries according to customer orders in the current month/the total number of deliveries in the current month.

In practice, we should ensure that we can deliver the goods correctly according to the customer's order. In the investigation, we also know that this is what customers are most concerned about, so not delivering goods according to customers' orders will cause the greatest damage to the service image of enterprises. Therefore, before delivery, it is necessary to repeatedly check whether the delivered goods meet the customer's requirements according to the customer's order. From this point of view, it is very necessary for enterprises to set up the position of order manager in distribution center. It will greatly improve the company's service level to have a special person to track, ensure the delivery and accuracy of orders from the source and reduce the probability of order errors.

Timely delivery rate:

Timely delivery rate = number of cars delivered on time in the current month/number of cars delivered in the current month.

At present, the delivery time of many products can reach short-distance next-day delivery. The solution is to establish a regional distribution center to directly transport the first-class wholesalers and second-class wholesalers who have the ability to pick up the whole vehicle in key cities and regions, and to establish a second-class distribution center in other provinces in the region to support the deep distribution strategy in counties, townships and towns for smaller batch distribution.

Damage rate of goods:

Damage rate of goods = value of damaged goods in the current month/total value of goods sent in the current month.

This index is used to measure the damage rate of goods in the process of distribution to customers. Generally, the maximum limit is 5%, and many cases of breakage occur during the loading and unloading of goods. At the peak of shipment, there is not enough loading and unloading force, which leads to slow delivery speed and high breakage rate. The suggested solution is to rent a forklift at the peak of shipment in the sales season to reduce the breakage rate and improve the loading and unloading speed.

Complaint frequency: The carrier helps the enterprise to deliver the goods to the customers, so the carrier represents the service image of the enterprise in the process of delivering the goods to the customers. Providing as many services as possible in this process will enhance the loyalty of the customers to the enterprise, but the most common complaint of the distribution center is that the service is not in place in the process of delivering the goods to the customers. In response to customer complaints, our suggestion is that enterprises should refine the service agreement with carriers and clearly put forward basic services such as helping to unload, notifying customers before arrival, collecting and returning, and possibly receiving goods in the future.