25 Supply Chain KPIs Every Manager Must Track (2024)

The five most important supply chain KPIs are: (1) OTIF (On-Time In-Full) — measures delivery execution quality, world-class ≥95%; (2) Inventory Turnover — how efficiently you convert inventory to sales, world-class 8x+ for most industries; (3) Perfect Order Rate — orders delivered defect-free end-to-end, world-class ≥98%; (4) Cash-to-Cash Cycle Time — how quickly you convert cash into inventory and back to cash, world-class <30 days; (5) Total Supply Chain Cost as % of Revenue — world-class ≤5%. These five metrics together give a comprehensive view of delivery quality, inventory efficiency, cost competitiveness, and cash management.

OTIF (On-Time In-Full) measures whether shipments are delivered on time and with correct quantity. Perfect Order Rate is a broader metric that adds documentation accuracy and condition requirements — the order must be on time, in full, damage-free, and correctly invoiced/documented. A shipment can be OTIF compliant but still fail Perfect Order if the invoice has errors or the goods arrive with transit damage. Perfect Order Rate is always lower than OTIF for the same operation.

Cash-to-Cash Cycle Time = Days Inventory Outstanding (DIO) + Days Sales Outstanding (DSO) - Days Payable Outstanding (DPO). DIO measures how long inventory sits before being sold. DSO measures how long it takes to collect payment after a sale. DPO measures how long you take to pay suppliers. A company with DIO=45, DSO=30, DPO=60 has a Cash-to-Cash cycle of 45+30-60 = 15 days, meaning it takes 15 days to recover its cash. Negative cash-to-cash (like Amazon's model at -30 days) means you collect from customers before paying suppliers.