Topic 4: Service level agreements that cannot be enforced without lots of extra manual effort

Remember before the contract is signed!

An SLA must be easy to enforce without much manual effort

Logistics is execution. And operations are a complex mix of details. The Big Picture is not always easy to grasp.


Did we deliver Ontime? Was the provided service without too much hassle? Is the service provider transparent in terms of costs and charges?

All these questions often end up with No, but...

Avoiding these back and forth discussions between service provider and customer requires upfront homework.

Key Performance Indicators are important but much more relevant for succes of the paartnership is to allign Operational Performance Indicators.

OTIF KPI is business critical but what we want to review as part of SLA is OPI reason for delay is a category our service provider was supposed to avoid.

Perfect Order KPI tells us how good we are but number of errors in logistics documents or documents not delivered at right point in process SOP is where the logistic partner was accountable for our poor transactional performance with a customer.

Transport cost KPI is business critical but what we want to monitor in SLA is surcharges like demurrage, weekend surcharge and other exceptional but avoidable charges.

And question to work on is not the definition of these OPI but how to measure and review them with partner.

Do available reports cover them? Do we need to adjust internal KPI reports? Can our partner fill the reporting gaps? And if noit, is the manual reporting of issues documented, standardized and sustainable?

Once the contract is signed, it will be too late and difficult to enforce the agreed service if we cannot monitor the partner with minimal effort!