Hello Everyone, newbie to the forum here.

We have an interesting scenario here. One of our our "Quality Objectives" is "On Time Delivery". However, our suppliers cannot always give an expected delivery date so we have to "Guess" at a delivery date to our customers. We can therefore be Early, On time or Late in delivery depending on when the product arrives, is tested and shipped.

Products are not off-the-shelf and have to be built to order. Getting a delivery date from the supplier is like getting blood out of a stone and they're ISO certified!

Does anyone else have a similar situation? If so how do you handle recording and analysing this situation?

Regards

Ian Large

Yes the situation is very common indeed !

Try to find out what your customer defines as 'on time' - is it bang on the day you say, or is there any latitude at all.

Find out how important 'on time' delivery is to them - it might not be as important as you think, but if it is critical, and must be bang on the date then you have an issue with your suppliers and they must work on improvement with you.

You obviously cant drop on time delivery as a metric simply because your suppliers are so poor at providing on time delivery their end.

Hello Everyone, newbie to the forum here.

We have an interesting scenario here. One of our our "Quality Objectives" is "On Time Delivery". However, our suppliers cannot always give an expected delivery date so we have to "Guess" at a delivery date to our customers. We can therefore be Early, On time or Late in delivery depending on when the product arrives, is tested and shipped.

Products are not off-the-shelf and have to be built to order. Getting a delivery date from the supplier is like getting blood out of a stone and they're ISO certified!

Does anyone else have a similar situation? If so how do you handle recording and analysing this situation?

Regards

Ian Large

Hello Ian,

Even though your supplier may not be able to provide you with an "exact" delivery date, each time your supplier's delivery performance affects your process in a negative manner, it is considered "late" and is a mark against them. I would use that as a measurement: "affected our process negatively." Corrective action is still required and perhaps the development of a new supplier.

Stijloor.

Thanks M,
On Time Delivery was specified by the MD as On or Before it hit the customers doorstep. My problem is trying to convince the supplier(s) that it's important to us to have an expected lead time. Been doing this for some years now and just wanted to see how others are handling it.
Ian

Hi Stijloor,
Yes, we keep recods of delivery time and review suppliers regularly. Changing suppliers is OK for consumables etc but our Major products are made by only a handful of manufacturers and we have FIVE year distribution agreements with them that cannot be easily changed. We just keep monitoring, recording and reporting back to them but get nowhere. We just can't go elsewhere for these products.
Ian

Looks like you are quite tied up with your supplier.

What about analysing delivery performance and using this actual data to set a lead time to your customers that you know your supplier will hit say 95% of the time, as you say delivering early counts as on time this should not be a problem ?

Hi,

We also have problems with suppliers which result in poor delivery performance.

But we measure 3 things:
On-time delivery
In-full (no goods missing)
Error-free (no wrong product)

combining the 3 gives us our on-time/in-full/error-free performance rating.

These are presented as spc charts and if delivery performance is an issue then we would work with our supplier(s) on possible corrective action(s).

Looks like you are quite tied up with your supplier.

What about analysing delivery performance and using this actual data to set a lead time to your customers that you know your supplier will hit say 95% of the time, as you say delivering early counts as on time this should not be a problem ?

I would say it depends on what industry you are in. For example, automotive or aerospace would not be receptive to "early" as an on-time delivery. Many organizations are running lean and wouldn't accept having to store an early delivery.

As has been said, you need to establish with your suppliers an acceptable lead time and coordinate that with your delivery requirements to your customer. If your customers don't care about delivery, don't shoot yourself in the foot by defining "on-time" as something you know you can't meet. The term "on-time" boils down to what has been agreed between you and the customer. If you agree with your customer to deliver sometime within the next year and you do, you have "on-time" delivery.

In the real world, you will need to manage and develop your suppliers to meet realistic delivery goals to enable you to provide the product to your customers according to their needs. If the supplier is ISO9001, they should be willing to work with you in developing a schedule everybody can live with.

Good luck and Welcome to the Cove.

Dave

I just recently started tracking ontime deliveries in terms of +/- from PO line promise dates. "0=ontime, "+ days"=late; "- days"=early.

By tracking this delta from the "0" baseline I get some visibility into delivery trends beyond just ontime vs late. We work on contracts instead of forecasting. We all know late deliveries are a problem, but I get nervous about persistent early deliveries...cost of carrying more inventory, inventory turns, suppliers dumping early to close out a PO to open up capacity for other products or shift resources for other products (process line essentially goes idle or shifts until a new PO is cut and another "start-up" ensues), and the dumping of non-conforming material.

It's early so I don't know how value-adding it will be but the data looks interesting.

welcome to the cove!

i hope you must be doing supplier evaluation from time and again where in the three critical success factors are evaluated like On time delivery, delivery in full and defect free supply.

Based on the rating, keep giving feedback to the supplier on his faults and make frequent visits to impress upon your criticality.

meanwhile, locate an alternate who could give you better servcies.

good luck. expecting active particiapation in forums!

In a previous life I tracked two types of "On Time Delivery".

MPM = ((Early + Late Deliveries) / Total Deliveries) X 1,000,000

JIT MPM = (Line Disruptions / Total Deliveries) X 1,000,000

MPM for some suppliers was 1,000,000 every month. No supplier was ever less than 200,000.

But the only one that really mattered to us was JIT MPM, which most were at 0 for the life of the program.

Ian:
I'm a bit late coming to this one, but it seems like you have a couple of options to get your suppliers to understand their role in the supply chain. You could always hit their Certification Body with a heads up that these suppliers don't meet contractual requirements (you do put the delivery requirements in the P.O., don't you?)

Alternately, and more appropriately, how about working with them to find out why they seem unable to commit and stick with delivery dates? It must be hurting them in some way - to have materials etc being processed or sitting around waiting - and by identifying the cause, with them, you could share the benefit. Believe me, someone at the suuplier knows they are suffering by not getting their product sooner - it's not rocket science, after all. Some one just doesn't see it, and you may have to lift their expectations.

Precisely, in a supply chain management, one has to do like what AndyN suggested (working with the supplier). thats why i mentioned on meeting the supplier frequently. this means, visiting his GEMBA, observing his lines, if possible identifying the wastes he incurs and suggesting supplier to minimize or eliminate it as we are paying for those wastes!

JIT MPM is a good formula which i will try now with my vendors!

I work in transportation - if your supplier is shipping with a common carrier and knows their ship date, then you should be able to get an expected delivery date. Most trucking companies have a matrix which will identify 1 day, 2 day, 3 day etc service from point a to point b. If the ship date is known you should be able to calculate a delivery date.