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How can you measure the impact of transportation disruptions on your supply chain?

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Transportation disruptions can have serious consequences for your supply chain, affecting your delivery times, costs, customer satisfaction, and profitability. Whether it's caused by natural disasters, strikes, accidents, or geopolitical events, you need to be able to measure the impact of these disruptions and take appropriate actions to mitigate the risks. In this article, we'll show you some methods and tools you can use to assess the effects of transportation disruptions on your supply chain.

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Marwan El Kashef
Zabeen Farook

Sr Logistics Officer @ Schneider Electric | CISCP-CISCM
Jean Baptiste FLECK ????????

Directeur des Opérations - Auditeur en Supply Chain - Conseil Supply Chain et Excellence opérationnelle

1 Identify your key performance indicators

To measure the impact of transportation disruptions, the first step is to define key performance indicators (KPIs) that reflect supply chain objectives and performance. KPIs are measurable values that demonstrate how well you are achieving goals and satisfying customer expectations. Common KPIs for import/export operations include on-time delivery, transit time, transportation cost, inventory level, and fill rate. On-time delivery is the percentage of orders delivered within the agreed time window, transit time is the average time it takes for goods to move from origin to destination, transportation cost is the total cost of moving goods including freight, fuel, taxes, and fees, inventory level is the amount of goods in stock at different locations, and fill rate is the percentage of orders fulfilled without backorders or shortages.

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Marwan El Kashef
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When measuring the impact of transportation disruptions on your supply chain, several key metrics and strategies can be employed: ? Cost Analysis: Assess the financial ramifications of transportation disruptions, including additional freight charges, expedited shipping costs, inventory holding costs, and potential lost sales revenue due to delayed deliveries. ? Inventory Levels: Track changes in inventory levels before, during, and after transportation disruptions. ? Supply Chain Resilience: Evaluate the resilience of your supply chain by assessing its ability to recover from transportation disruptions. Employing these measurement techniques, you can gain valuable insights into the impact of transportation disruptions.

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Zabeen Farook

Sr Logistics Officer @ Schneider Electric | CISCP-CISCM
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KPIs: On-time delivery, lead times, inventory levels, cost fluctuations. Disruption Impact: Increased lead times, extra transportation costs, inventory changes. Customer Impact: Backorders, complaints, order cancellations due to disruptions. Financial Impact: Increased transportation and inventory costs, potential revenue losses. Operational Efficiency: Measure alternative routes' efficiency during disruptions. Risk Management: Evaluate effectiveness of risk mitigation strategies. Data Analysis: Use historical data to quantify impact and identify trends

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Victor Ajewole

Freight Forwarding, Logistics and Supply Chain ??????
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A few KPIs to pay attention to. 1. The proportion of orders received versus orders filled. 2. Cost of transporting 3. Inventory turnover 4. Lead time 5. Ratio of orders processed vs customer satisfaction 6. Rate of on time delivery

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Ratheesh Krishnankutty

Logistics Specialist
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In my Opinion. Transportation disruptions have a significant impact on supply chain performance. These disruptions can lead to delays in goods arrival, jeopardizing the service level to customers . The timing and severity of transportation disruptions affect a supplier's decision on whether to acquire and share private information, which can enhance the performance of the disrupted supply chain .

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Smit Shah

Technical Planning Manager at Caterpillar Inc.
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Whenever there are significant disruptions, the immediate signs are the transportation costs going up as these agencies are the first to be impacted. These increases then lead to expedited services and their inflated costs. Even with this step, the lead times to the customer increase thereby necessitating higher buffers or safety stocks. This leads to lower fill rates and lower service levels. Each higher step in the supply chain sees more drastic an impact akin to bullwhip effect.

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2 Track your transportation data

Gathering and analyzing your transportation data is the next step for monitoring your KPIs and detecting any deviations or anomalies. You can use sources such as a Transportation Management System (TMS) to plan, execute, and optimize operations, a Global Positioning System (GPS) to track vehicles and shipments, Electronic Data Interchange (EDI) to exchange information between supply chain partners, and the Internet of Things (IoT) to collect and transmit data instantly.

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Jean Baptiste FLECK ????????

Directeur des Opérations - Auditeur en Supply Chain - Conseil Supply Chain et Excellence opérationnelle
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Les données analytiques doivent d'abord être structurées en amont que ce soit dans un TMS, dans l'ERP, un SharePoint ou un data warehouse ou excel. Une mose sous control des master data prend ensuite des mois voire des années. Plus le périmètre est important, plus le contr?le des données à une importance fondamentale pour pouvoir disposer d'une matière première de qualité afin d'exploiter ensuite ces données ds des démarches de type DMAIC ou dans mini tab afin de trouver des effets de corrélation entre le retard et la cause réelle de ce retard. Les master data doivent également prendre en considération les causes racines de manière standard, qui doivent être renseignées par tous les prestataires et challengées par les équipes internes.

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Abdoul Kader BARRY

Assistant chargé du Suivi des Approvisionnements chez HAGE MATERIAUX
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Effectivement, les données sur les marchés mondiaux du Fret peuvent indiquer une croissance ralentie en raison des perturbations des cha?nes d'approvisionnement.

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Julio Ferreira Oliveira

Comercial | Desenvolvimento de Negócios | Parcerias Estratégicas | Cadeia de Suprimentos | Engajamento de Stakeholders | Projetos
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Aqui est?o algumas práticas essenciais para realizar esse acompanhamento de forma eficaz: 1. Utilizar Sistemas Integrados de Gerenciamento de Transporte (TMS). 2. Utilizar Sensores e Dispositivos de Rastreamento (GPS, RFID e sensores de temperatura). 3. Integra??o com Parceiros Logísticos. 4. Analytics e Business Intelligence (BI). 5. Automatiza??o de Processos. 6. Monitoramento Proativo (Estabelecer alertas automáticos para eventos críticos). 7. Análise de Tendências e Padr?es.

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Luiz Tavares

Gerente comercial na INOVAMETA PDI | Business Account Manager | Especialista em desenvolvimento de negócios | Liderando equipes de alta performance
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Rastrei seus dados de transporte. O índice mais importante e de fácil entendimento para tomada de medidas rápidas é o feed back do cliente e demais envolvidos na opera??o. Coletar esses dados cada vez mais detalhado e no início da cadeia vai lhe alimentar com dados importantes da vis?o da opera??o em rela??o ao seu servi?o/produto. Trate com dedica??o pequenos indicadores.

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3 Calculate your transportation disruption index

The third step is to quantify the impact of transportation disruptions on your supply chain with a transportation disruption index (TDI). This numerical value represents the severity and frequency of transportation disruptions in a given period and location. You can calculate your TDI by using a formula that incorporates the number of disruptions, the duration of each disruption, the volume of shipments affected, and the importance of each shipment for your business. A higher TDI indicates a greater impact of transportation disruptions on your supply chain.

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Julio Ferreira Oliveira

Comercial | Desenvolvimento de Negócios | Parcerias Estratégicas | Cadeia de Suprimentos | Engajamento de Stakeholders | Projetos
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O TDI pode ser calculado de maneira prática seguindo algumas etapas: 1. Defini??o de Variáveis-Chave. 2. Atribui??o de Peso às Variáveis (importancia estratégica de cada uma para a opera??o). 3. Normaliza??o dos Dados. 4. Cria??o de Subíndices (desempenho relativo de cada variável). 5. Cálculo do índice de Interrup??o de Transporte (TDI): - Combine os subíndices para calcular o TDI. 6. Estabelecimento de Benchmarking: ? Compare o valor do TDI ao longo do tempo e estabele?a benchmarks para avaliar o desempenho em rela??o a metas pré-determinadas. 7. Análise e A??es Corretivas: ? Utilize o TDI como uma ferramenta analítica para identificar áreas específicas de fraqueza na cadeia de suprimentos.

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4 Benchmark your transportation performance

The fourth step is to compare your transportation performance with your historical data, your targets, and your industry standards. This will help you evaluate how well you are coping with transportation disruptions and identify any gaps or opportunities for improvement. You can use various methods and tools for benchmarking, such as dashboards, reports, and scorecards. Dashboards are a visual display that show your KPIs and TDI in a clear and concise way. Reports are documents that summarize your transportation performance and provide insights and recommendations. Scorecards are tools that measure and compare your transportation performance with your predefined goals and best practices.

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Jean Baptiste FLECK ????????

Directeur des Opérations - Auditeur en Supply Chain - Conseil Supply Chain et Excellence opérationnelle
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Les techniques du lean manufacturing sont à privilégier. Des cartes de contr?le de type SPC peuvent être mises en ?uvre Un DMAIC permettra de progresser significativement. L'objectif in fine restera de s'assurer que les paramètres dans l'ERP, qui concourent à calculer correctement les bonnes quantités à réapprovisionner au bon moment sont justes. La variabilité des délais de transport sera quant à elle, reportée dans les calculs de stock de sécurité et déterminera même la formule à utiliser suivant qu'il y ait ou pas une variabilité par rapport à la médiane observée.

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Abdoul Kader BARRY

Assistant chargé du Suivi des Approvisionnements chez HAGE MATERIAUX
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Pour évaluer les performances en matière de transport il est important de suivre les indicateurs clés de performance (KPI) exemple : 1.LA RENTABILITé DES EXPéDITIONS 2.PERFORMANCE DES CONDUCTEURS 3.PERFORMANCE DES VéHICULES 4.SATISFACTION DES CLIENTS

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Julio Ferreira Oliveira

Comercial | Desenvolvimento de Negócios | Parcerias Estratégicas | Cadeia de Suprimentos | Engajamento de Stakeholders | Projetos
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Aqui está uma sugest?o de passo-a-passo com algumas práticas para realizar essa avalia??o de forma eficaz: 1. Estabelecimento de Indicadores de Desempenho (KPIs). 2. Coleta de Dados Históricos. 3. Estabelecimento de Metas Mensuráveis. 4. Benchmarking com Padr?es do Setor. 5. Análise de Varia??es. 6. Utiliza??o de Ferramentas Analíticas. 7. Feedback Contínuo e Melhoria. 8. Avalia??o de Resiliência e Flexibilidade.

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5 Implement your transportation contingency plan

The final step is to implement a transportation contingency plan to minimize the impact of transportation disruptions and ensure the continuity of your supply chain. This plan consists of a set of actions and alternatives that can be used in the event of a disruption. For instance, you should consider backup transportation modes and routes, additional inventory and safety stock, flexible delivery options and policies, communication and collaboration with suppliers and customers, as well as insurance and risk management strategies.

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Jean Baptiste FLECK ????????

Directeur des Opérations - Auditeur en Supply Chain - Conseil Supply Chain et Excellence opérationnelle
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Les solutions alternatives doivent déjà avoir été testées et doivent être utilisées de manière permanente avec des petits volumes. Il s'agit de ma?triser le flux et de s'assurer que l'on pourrait être flexible lorsqu'un événement perturbant le flux arrive. Les procédures de fonctionnement doivent être décrites et connues de tous. Une escalade rapide et une décision dans un temps très court permettront l'équipe de fonctionner en parfaite autonomie dans les limites budgétaires qui lui sont fixées. Ainsi, l'entreprise qui est bien organisée sera la première servie sur les flux alternatifs. Cela met des mois et des années pour le rendre opérationnel. Généralement les entreprises préfèrent gérer le risque et ses conséquences sur le business ??

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Abdoul Kader BARRY

Assistant chargé du Suivi des Approvisionnements chez HAGE MATERIAUX
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Ici, il faut envisager des processus alternatifs pour vous aider à élaborer un plan de secours en cas de perturbations. Aussi il serait judicieux de créer un budget d'urgence qui peut être investi selon les besoins en cas de crises.

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Matthew Kennedy

Founder | Hemp Hounds
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Some things to consider: 1. Deploy Real-Time Monitoring: - Utilize blockchain or RFID for live shipment tracking. - Employ IoT sensors and AI for swift disruption detection. 2. Conduct Scenario Analysis: - Develop predictive models for simulating disruption impacts. - Assess supply chain resilience through virtual testing. 3. Collaborate in Risk Management: - Partner with transport providers for shared risk insights. - Collaborate with peers on joint mitigation strategies. 4. Use Data-driven Decision Making: - Analyze historical data with big data analytics. - Implement machine learning for real-time response optimization.

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6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Jean Baptiste FLECK ????????

Directeur des Opérations - Auditeur en Supply Chain - Conseil Supply Chain et Excellence opérationnelle
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1. Ma?triser ses processus ?? les formaliser 2. Travailler les interactions entre le donneur d'ordre et les prestataires ?? Standard Operating Procedure 3. Revue des KPI toutes les semaines 4. Tracker les causes racines de chaque non performance 5. Prévoir les cas d'exonération du prestataire?? Faute du donneur d'ordre ou cas de force majeur ?? recalculer les KPI plus justes 6. Mettre des pénalités dans mes contrats même petites 7. Revue mensuelle des kpi 8. Vérifier vos factures afin d'éviter les éventuelles surfacturations 9. Demandez de l'innovation à vos prestataires. Eux aussi investissent dans la R&D 10. Recruter des spécialistes du transport car les industriels ne sont pas formés à ces métiers J'en ai encore plein en réserve!!!

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Shri Bajaj

Import Export Manager at Shri Bajaj International.
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Transportation disruptions have a significant impact on supply chain performance as these disruptions can lead to delays in good arrival, jeopardizing the service level to customers

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Asif Ali

Import / Export / Procurement / Supply Chain Management / Logistics / Inventory Control
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Measuring the impact of transportation disruptions on your supply chain involves evaluating various key performance indicators (KPIs) and analyzing the overall operational and financial impact. Here are some steps to effectively measure the impact of transportation disruptions: on-time delivery performance, inventory levels, cost analysis, customer complaints and feedback, production downtime, supplier performance, and lead time variability. Analyzing these key indicators will provide insights into the operational and financial consequences, enabling you to mitigate risks and make improvements.

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How can you measure the impact of transportation disruptions on your supply chain?

1

2

3

4

5

6

1 Identify your key performance indicators

2 Track your transportation data

3 Calculate your transportation disruption index

4 Benchmark your transportation performance

5 Implement your transportation contingency plan

6 Here’s what else to consider

Import/Export Operations

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How can you measure the impact of transportation disruptions on your supply chain?

1

2

3

4

5

6

1 Identify your key performance indicators

2 Track your transportation data

3 Calculate your transportation disruption index

4 Benchmark your transportation performance

5 Implement your transportation contingency plan

6 Here’s what else to consider

Import/Export Operations

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