I’m here today with Trent Morris to take a closer look at performance management.
According to Trent, performance management is about more than just KPIs, and he believes there’s a lot of misunderstanding around how KPIs should be used.
Aim for 100%: Rethinking Performance Management
Performance management is a topic we often discuss, especially in the context of KPIs. But is performance management really all about KPIs? Trent Morris joined me to challenge that idea and share why we need to rethink our approach to performance.
Why 98% Isn’t Good Enough
Trent explained that while many organizations set KPIs at targets like 98%, what they’re really paying for—and should aim for—is 100%. Think about it: when we talk about supply chain performance or the perfect order, we don’t want a 98% success rate; we want perfection. But by setting KPIs below 100%, we lower our expectations. Worse, when critical failure thresholds—like 95%—are introduced, 95% effectively becomes the real target. Trent’s perspective is clear: while it’s realistic to accept that things can go wrong, the goal should always be 100% quality and service.
Collaboration is the Key to Better Outcomes
This doesn’t just apply to supplier relationships but also to internal operations like warehousing and transport. If we aim for 98%, we’re likely to fall short. But by aiming for 100%, we set a higher standard that drives improvement. Trent also highlighted the importance of collaboration—whether with suppliers or internal teams—to address gaps and create a culture of continuous improvement. If we focus on working together to close performance gaps, we’re more likely to achieve long-term success.
Start with the Right KPIs
For those looking to improve, Trent had some solid advice. First, make sure your KPIs are clearly defined and tied to the critical aspects of your business. Start measuring performance regularly and use the data to identify areas for improvement. It doesn’t have to be overwhelming—begin with a few key metrics and build from there. The goal is to set KPIs that reflect what truly matters and use them as a foundation for continuous improvement.
Related articles on this topic have appeared throughout our website, check them out:
- 4 Tips for Effective Supplier Performance Management
- Total Supplier Performance Evaluation: More than a Suite of KPIs
- How to Address Chronic Poor Supplier Performance
Editor’s Note: The content of this post was originally published on Logistics Bureau’s website dated April 05, 2023, under the title “Supplier Performance Management with Trent?“.
