A Review and Evaluation of Logistics Metrics

Abstract

Performance measurement in the logistics function, like all business functions, begins at the individual metric level. A performance measurement system that is well designed at the strategic level can be flawed at the individual metric level; the Achilles' Heel of any measurement system. The pressing need is not for the development of novel performance metrics: there is a great abundance of sufficient metrics already in existence. Rather, there is a need for a method with which to evaluate existing metrics. This paper addresses this need by suggesting a set of evaluation criteria for individual logistics performance metrics and identifying the inherent trade‐offs. A taxonomy of logistics performance metrics, organized by process rather than by function, is also presented and the metrics are evaluated using the established criteria.