Harmonization of Execution Metrics for Plants & Warehouses: Four Leading Industry Organizations Set Standard Definitions & Calculations

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Four industry associations have collaborated to release their first materials on holistic metrics for gauging the performance of execution in both production plants and inbound & outbound warehouses. The associations are Manufacturing Enterprise Solutions Association (MESA) International, the Order Fulfillment Council (OFC) and the Supply Chain Execution Systems & Technologies Group (SCE Group) as part of the Material Handling Industry of America (MHIA) trade association, and the Warehousing Education and Research Council (WERC).

Four industry associations have united to launch a joint initiative to create holistic metrics for gauging the performance of execution in both production plants and inbound & outbound warehouses. The associations are Manufacturing Enterprise Solutions Association (MESA) International, the Order Fulfillment Council (OFC) and the Supply Chain Execution Systems & Technologies Group (SCE Group) as part of the Material Handling Industry of America (MHIA) trade association, and the Warehousing Education and Research Council (WERC). They have kicked off this joint initiative with their first paper, Improving Order Execution Performance: A Holistic View of Metrics Across Plant & Warehouse, presented at the MESA Plant-to-Enterprise Conference in Orlando, FL.

The four organizations collaborated to create common definitions and calculations for dozens of performance metrics that apply in both plants and warehouses. While the metrics themselves are already in use, the common understanding generated by having four industry organizations unified on definitions and calculations is new.

The paper introduces the framework within which these organizations will do benchmarking. The framework categorizes metrics in six major performance areas:

  • Customer-facing metrics: order fulfillment, and mass customization or flexibility
  • Internal metrics: inventory management and execution productivity
  • Metrics that have an impact on both customers and internal processes: quality and compliance; and business and financial

MESA, OFC, SCE and WERC have a stated goal of conducting research using these metrics starting in 2009. This will be an extension of the current WERC Watch benchmarking studies as well as MESA's Metrics that Matter series. This agreement between organizations also had an impact on the benchmarking study WERC Watch 2008 released this past spring, which is based in part on these newly-agreed upon metrics. The paper was developed by three independent researchers under contract to these organizations: Julie Fraser of industry analysis and consulting firm Cambashi; Kate Vitasek of consulting firm Supply Chain Visions, and Dr. Karl Manrodt, Professor at Georgia Southern University. The conference presentation on this research was delivered by Fraser and Manrodt at the MESA Plant-to-Enterprise conference.    

The paper released today is available to members of the four organizations, and can be purchased by nonmembers for $50.00. Future materials will be made available on a similar basis to members and to nonmembers by purchase.

About MESA International
MESA is an association of manufacturers/producers, solution providers and industry professionals, promoting innovation and best practices sharing, with a goal of delivering valuable knowledge around operations-centric enterprise solutions.
MESA defines industry standard methodologies and approaches that allow manufacturers/producers to bridge execution excellence with enterprise level requirements. MESA's industry events, symposiums and publications help cultivate understanding, analysis and the exchange of strategies and innovation to achieve manufacturing leadership. For more information, visit http://www.mesa.org.

About OFC
The Order Fulfillment Council (OFC) develops and delivers educational and training resources for end users, educational institutions, allied organizations, and its own members to properly understand and apply order fulfillment solutions. OFC serves as a conduit to share ideas and information amongst member companies regarding opportunities in the marketplace by developing formats/forums to engage OFC members throughout the year.

About SCE
The Supply Chain Execution Systems & Technologies Group members are the Industry's leading suppliers of Supply Chain Execution software, hardware and services. They supply solutions worldwide and in virtually every major manufacturing and distribution sector.

About WERC
The Warehousing Education and Research Council is the only professional organization focused on warehouse management and its role in the supply chain. WERC is where distribution experts come together to share practical knowledge and professional expertise with the aim of improving individual and industry performance. Through membership in WERC, seasoned practitioners as well as those new to the industry stay at the forefront of innovation, master best practices and establish valuable professional relationships.

WERC focuses on practical operations within the context of strategic global matters like technology, globalization, infrastructure, workforce management and legislation. WERC offers unique resources that help distribution professionals stay at the leading edge including educational events, practical research, expert insights and peer-to-peer knowledge exchange.

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Julie Fraser
MESA
508-362-3480
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