If someone were to ask you how your logistics carriers were performing, do you have visibility on that process?
As a logistics manager, you must keep track of your carrier performance and understand whether you’re getting your monies worth. You may have signed an SLA with your carrier, but do you know if they’re upholding their end of the bargain? More so, are you able to compare the performance of carriers across the same KPIs?
We at Parcel Perform know that there’s many competing priorities on your plate. Why not automate the monitoring and assessing with Parcel Perform so you can spend more time on other business tasks?
In this article, we’re introducing a new service to manage and measure the Service Level Agreements (SLA) Compliance with your carriers so you can worry less about digging into detailed data and instead focus more on improving your logistics operations and costs.
First off, the fundamentals:
What is a Service Level Agreement?
Service Level Agreements (abbr. SLA) are commitments between providers and receivers of a service. In logistics, SLAs are agreements made between a carrier and a merchant promising a certain performance level for their deliveries and parcels made through that carrier.
Why track an SLA?
Management guru Peter Drucker famously said:
“If you can’t measure it, you can’t improve it”.
The same principle applies to your logistics performance.
Tracking SLA Compliance provides organisations with quantifiable metrics to measure the success with which specific services are being performed.
The challenge? While only a handful of carriers can give you a comprehensive SLA reporting, the numbers and KPIs provided are often not standardized. A headache, especially if you want to compare different carriers with each other.
With our standardization of data across all carriers and automated and accurate SLA compliance reporting, retailers can now finally get full visibility in their service providers performance and the full health of your operational processes.
You’ll also get a complete understanding on the efficiency and quality of your logistics service providers, giving you the insights to help select the best providers by service, transit time, region or trade lane, weight and anything else you might want to know.
What can SLAs measure and why does it matter?
Understanding and measuring your carriers individually and collective logistics processes across your last mile and entire supply chain helps to improve efficiency, select the best carrier and optimize your logistics spend.
However, the benefits go beyond logistics optimization. We’ve seen an increased emphasis on the importance of the post-purchase experience and 2020 will be no different. Taking control of your logistics also helps to build trust, retain customers and improve customer lifetime value.
Some of our customers have already established powerful compliance measurements. Here are some examples:
- Track parcel delivery times and segment by various metrics: For example, segment parcel delivery time by logistics carrier, by geographical region or parcel type and service to understand which segments are performing well or need further attention.
- Track time elapsed from order to pickup: How much time passes between an order from an end-consumer to pickup at your warehouse? This can give you a glimpse of the efficiency of your internal operations.
- Track time elapsed for alternative delivery modes, e.g. from delivery to pickup by end consumer: If you allow delivery to parcel lockers or other locations, it’ll be useful to track how much time a parcel spends in a parcel locker or external delivery location before it is picked up by your customer to measure effectiveness
Where Parcel Perform can help you streamline the monitoring process and save valuable time:
Our team at Parcel Perform create customised SLA metrics to provide real-time calculations on SLA compliance on individual parcels.
- We automatically track the performance of the parcels and assess this based on the terms of your specific SLA agreement with the carrier.
- Tracking and calculations happen in real-time, allowing instant tracking of SLA performance.
- SLA performance can be assessed overall and on a per-parcel basis with countless filtering options available such as location (trade lane), timeframe, carrier, parcel type, weight and many more.
Why can’t I do it myself?
SLA monitoring can very well be done by the retailer. However, retailers must keep these three challenges in mind when planning their own reporting processes.
- Monitoring: Delivery performance must be tracked and compared to promised service levels.
- Quantifying: Performance levels can be difficult to quantify, and a tedious process
- Infrastructure: to calculate SLAs in real time and track their performance using analytics requires considerable investment in IT infrastructure and resources. We’ve already made this investment, so you can focus on the important things.
How Parcel Perform works with you to create your SLA reporting
Co-creating an SLA monitoring arrangement with us is simple. We break down our working process here:
Step 1: Create your SLA rules
SLAs are unique to your organization. To address these complexities, Parcel Perform has created a methodology to configure bespoke SLA reports to meet your specific needs. To make sure we understand your requirements completely, one of our experts will sit down with your team to understand your business goals and what you wish to track in your SLA reporting (these guys also know Machine Learning very well – try us!)
Once that’s jointly aligned, our technical teams will implement the logic for the SLA rules into your Parcel Perform account. This is fully customisable – you can specify multiple rules and layers of specificity to fit your business goals.
Step 2: Assess your parcels based on the defined SLA rules and calculate overall SLA compliance.
Once implemented, we assess each parcel based on the SLA rules defined in Step 1 and we capture both individual and aggregated statistics to determine the overall compliance with your SLA.
Step 3: Create a custom dashboard in your Parcel Perform’s Logistics Intelligence module to track SLA performance and all compliance elements.
Users of our SLA reporting service will find all the necessary SLA charts within the Logistics Intelligence module. If you require other charts, no problem – our team can customize that for you too!
Once your dashboard is complete, navigate to your Logistics Intelligence Module and click on your SLA report to view the analysis on your SLA metrics:
How Parcel Perform defines a Breach and Comply in relation to SLA rules:
Breach – A parcel breaches an SLA when the level of service by the carrier cannot meet one or more of the specific rules defined with Parcel Perform.
Comply – A parcel complies with an SLA when the level of service by the carrier meets all the specific rules as defined with Parcel Perform.
Once your dashboard has been set up, enjoy a similar level of unparalleled flexibility and detail for your SLA metrics in a single overview within the report. Navigate to the drop-down menu per chart to select the metric you wish to analyze.
Some logistics metrics covered in our comprehensive SLA reports:
- Compliance overview: A percentage breakdown of the parcels tracked and whether they comply with the SLA requirements.
- Compliance by carrier: Breach/Comply metrics of all parcels tracked, broken down by carrier. Use this report to quickly determine which carrier is falling short of SLA expectations for follow up action.
- Breaches by day: A summary graph of the number of breaches by week and the Breach-Comply percentage of all parcels tracked in that timeframe
- Issues causing breaches: A review of all the issues which lead to the parcel being classified as breached.
With SLA reports, you can get a quick high-level perspective on your logistics performance across your selected timeframe; perfect for management presentations or reports, or drill-down into the specific metric for more detailed analysis. Feel free to experiment with different combinations of tables and charts to see what works for you!
Leave SLAs and logistics reporting to Parcel Perform and gain valuable time for your business:
Managing logistics data can be a complex affair.
But it doesn’t have to be.
Let our e-commerce experts take care of the tedium while you get full visibility on your logistics processes while freeing up your time for other tasks.
This SLA reporting service is now available to all our customers. Reach out to your account managers if you have questions and want to explore this option further.
Joshua is the Marketing Manager at Parcel Perform. He loves technology and a good book. Outside of e-commerce and Parcel Perform, you can find him in the kitchen, gym or yoga studio.