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Improving supplier delivery performance through OTD analysis and process optimization
BSc / MSc in Industrial Engineering and Management
Supplier delivery performance and specifically On-Time Delivery (OTD) is a critical key performance indicator (KPI) within sourcing service. OTD measures the extent to which suppliers meet agreed delivery dates and impacts continuity and service levels.
Currently, supplier delivery performance shows variability, and the drivers of this performance are not systematically analysed or actively managed. As a result, there is limited insight into how process design, decision-making processes, and stakeholder collaboration affect OTD outcomes.
To improve delivery reliability and strengthen process control, a structured and data-driven analysis of supplier delivery performance is required. This analysis focuses on identifying key performance indicators, uncovering process bottlenecks, and defining improvement opportunities within the sourcing service process.
Objective
The objective of this assignment is to examine the factors affecting On-Time Delivery (OTD) within the sourcing service process and to develop key performance indicators and monitoring tools that increases delivery reliability and process control.
The assignment aims to:
· Define OTD within the organizational scope.
· Assess the current level of OTD performance and identify variability.
· Analyse internal and external drivers influencing supplier delivery performance.
· Identify bottlenecks, management gaps, and root causes of delivery deviations.
· Develop data-driven improvement actions to increase OTD performance.
· Design a performance dashboard for continuous monitoring and decision support.
Central research question
How can On-Time Delivery (OTD) within the sourcing service process be improved by identifying its key drivers and implementing data-driven improvement measures and monitoring tools to increase delivery reliability and process control
Your tasks:
Task 1: OTD measurement and baseline analysis
· Define a clear definition of On-Time Delivery (OTD);
· Collect and analyze historical data to determine baseline OTD performance;
· Identify patterns, variability, and trends in OTD across suppliers, order types, and categories.
Task 2: Process analysis
· Map the current sourcing service process, including roles, responsibilities, decision points, and information flows;
· Assess how process design and operational practices influence supplier delivery performance;
· Identify bottlenecks, approval delays, and coordination challenges that impact OTD.
Task 3: Identification of performance drivers and root causes
· Conduct a root cause analysis of late or delayed deliveries;
· Differentiate between internal process-related drivers and external supplier-related drivers;
· Evaluate management framework, KPI ownership, and current monitoring related to OTD.
Task 4: Development of improvement initiatives
· Develop at least three feasible improvement initiatives targeting the identified OTD drivers;
· Assess the expected impact of each initiative on delivery reliability and process stability;
· Propose performance monitoring, such as KPI dashboards and clear ownership assignments.
Task 5: Future-state process design
· Define how OTD will be monitored, managed, and implemented within the management framework;
· Provide an implementation roadmap to support adoption and sustainable improvement.