Key performance indicators (KPIs) are constantly in flux. This is espcially true since the pandemic. To see how they have evolved, RXO recently released a report, The Logistics Professional’s Guide to KPIs.
The research study, conducted in collaboration with research firm Qualtrics, aims to equip shippers and carriers with current industry benchmarks for critical transportation metrics – from on-time delivery to primary tender acceptance.
“KPIs are essential for effective supply chain management and continuous improvement, and they’re always evolving,” said Ben Steffes, vice president of solutions & strategy at RXO, in a statement. “Shifts in consumer demand and an influx of technology are driving this change, in combination with the dynamic and fragmented nature of the freight market. To optimize performance, businesses need consistent measurement and reporting."
The report reveals how shippers and carriers have changed their approach to evaluating and managing KPIs, including:
Shippers are more data-driven — 86% of shippers reference their logistics KPIs at least weekly (up from 79% in 2022), with 45% of shippers referencing them daily (up from 32%).
A growing need for an industry standard — 87% of shippers and 90% of carriers agree there should be set KPI industry standards, up from 78% and 74% in 2022, respectively.
Performance benchmarks are slightly more lenient — Industry performance standards for core transportation KPIs (on-time performance, payables, tender acceptance, etc.) are generally consistent with 2022, but underlying data shows a tendency to be a bit more forgiving.
Being a shipper-of-choice can enable better rates and more capacity — 95% of carriers said inefficient shipping practices impact the rates they give to shippers, and 99% of carriers take a shipper’s KPI expectations into account before agreeing to move a shipment.
"Managing supply chain data is incredibly important, but it’s not easy. What technology to use, which metrics to track, where to set benchmarks, how to leverage data to drive action – modern logistics professionals grapple with all these challenges. This study, with insights from 1,000 industry peers, offers a great tool to check their strategies against,” Steffes said.
