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36. KPI in All Industries

36.12 Logistics

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Dispatch interviews ask on-time delivery, damage, and cost per shipment. Kilometres driven, and shipment count, do not tell you the lane that failed. Depots here are fictional.

KPI What the number means Who uses it Action it drives
On-time % Shipments delivered on time divided by shipments. Lane owner A lane under the promise gets a different cutoff or a different carrier in the practice file.
Damage % Damaged shipments divided by shipments. Warehouse and dispatch Damage is a packing or handling problem. Do not hide it inside "delivered".
Cost per shipment Cost divided by shipments. Dispatch manager A cheap lane that is late is not cheap. Read it beside on-time.

Fictional sample rows. One week.

Lane Shipments On time Damaged Cost
Pune → Nashik 40 36 1 ₹20,000
Pune → Kolhapur 20 10 2 ₹16,000
Nashik → Nagpur 30 27 0 ₹18,000
Nashik → Pune 25 22 1 ₹12,500
Kolhapur → Mumbai 16 12 2 ₹9,600
Nagpur → Sambhaji Nagar 24 18 3 ₹14,400

Worked from those rows.

  • Shipments 155. On time 125. Damaged 9. Cost ₹90,500.
  • On-time % is 125 ÷ 155 = 80.6%.
  • Damage % is 9 ÷ 155 = 5.8%.
  • Cost per shipment is 90,500 ÷ 155 = ₹584 (nearest rupee).

Pune → Kolhapur: on time 10 ÷ 20 = 50.0%, damage 2 ÷ 20 = 10.0%, cost per shipment 16,000 ÷ 20 = ₹800. Nashik → Nagpur: on time 27 ÷ 30 = 90.0%, damage 0, cost 18,000 ÷ 30 = ₹600.

Good KPI Vanity metric
From the same rows Pune → Kolhapur on time 50.0% Pune → Nashik 40 shipments
Why Half the Kolhapur lane was late, at ₹800 each. The Nashik lane has the most trips and looks like the "main work". It is actually the healthier cheap-enough lane (36 ÷ 40 = 90.0% on time).

What the manager does. The Pune dispatch manager opens the 10 late Kolhapur shipments (cutoff time, or a truck that left after the dock closed) before adding a second truck on the Nashik lane. The Nashik manager keeps the Nagpur lane as the pattern and checks the one damaged box on Nashik → Pune, not the shipment count. Nagpur → Sambhaji Nagar damage is 3 ÷ 24 = 12.5%. That is a packing conversation, not a volume conversation.

Ravindra Bagale's Tip

Friends, many students count damaged-but-early boxes as "on time" in on-time %. Show damage separately. If the customer got the box and it was broken, that is not on time. Pay attention!