Customers always expect that their items will be delivered on time and in sufficient quantity as committed. Therefore, the ability to meet delivery requirements plays a very important role in managing the quality of service to customers in all categories.

For the purpose of assessing this capability, OTIF in supply chain management is applied to measure how often customers will receive the items they need in the desired quantity.

In addition, OTIF is also used as a criterion in most manufacturing-service industries, for both B2C and B2B enterprises or provided by retailers to evaluate delivery results between suppliers.

What is OTIF in Supply Chain Management?

OTIF stands for on time in full. This is an indicator to assess the level of full and on-time delivery in supply chain management.

This metric helps to measure the level at which incoming shipments ensure quantity and quality or time as committed to the order. However, the client will be able to provide a certain range of errors.

OTIF is theoretically considered a theoretical metric to help align the work completion goals of 3PLs, suppliers, carriers, and retailers.

Punctuality here is understood as the specific period recorded on the shipment and the times in the period as committed. Over time some metrics include on-time delivery, order lifecycle, perfect fulfillment, etc.

(Source: WERC)

Benefits of OTIF

When the market is showing an extremely competitive situation, OTIF is one of the important criteria to help businesses measure supply chain performance. This indicator is considered the final result in the overall supply chain operation in terms of business performance.

OTIF is also an effective tool to help businesses better understand the level of customer satisfaction with their operations.

For OTIF to be maintained at a high level, businesses need to establish a reasonable process to own a good plan and a flexible and optimal overall operating process.

Since there are many causes of supply chain disruption at any stage that adversely affect customer satisfaction rates, for businesses, improving OTIF is extremely essential 

Developed to help manage delivery time details and have objective indicators to evaluate OTIF, Meksmart develops TMS fleet management software to help businesses manage the delivery process of the fleet, from ordering, shipping, and delivery to the destination location.

The data is also recorded in real-time on the system, making information transparent and easy to analyze to get the next right action.

Epilogue

In short, OTIF in supply chain management can be understood as an indicator that helps measure performance in the supply chain.

Businesses can use OTIF as a metric to be able to make the right decisions, help improve the delivery of goods to customers, and enhance customer satisfaction with their products and services.