Directness as a key performance indicator for freight transport chains

Abstract

From the perspective of a transport service buyer and at the abstraction level of material flows, all transports travel directly from product supplier to product customer. In reality, however, the directness of transport services depends on factors such as geography, available infrastructure, temporary conditions, shippers' qualitative preferences, the economy of and practical possibilities for consolidation and access to return flows. This work examines directness by structuring and elaborating upon the causes of freight transport detours and briefly analysing their effect. The article also includes a discussion about the prospects of capturing directness in a KPI, and how such a measure can be designed, measured, monitored and used, as well as a brief analysis of the consequences of using it for monitoring and controlling supply chain performance.Detours are divided into supply chain, logistics and freight transport detours respectively and most attention is paid to the last kind of detour. Freight transport detours are divided into physical, political, commercial, operational and non-planned causes for detours. The first two stipulate the system environment in which the focused actors, transport service providers, decide upon detours. Operational causes are subject to internal decision making whereas commercial and non-planned causes are both external and internal to transport service providers.