Purpose of the lesson
Measure actual transport and distribution performance against approved operational targets, identify causes of non-performance and develop a service-recovery plan.
Practical outcome
By the end of this lesson, you must be able to:
- Measure on-time delivery.
- Measure delivery-in-full performance.
- Monitor delivery damage and returns.
- Compare delivery costs with the approved budget.
- Measure compliance with transport-risk controls.
- Identify root causes of non-performance.
- Develop and monitor an appropriate service-recovery plan.
1. Gather the required information
Obtain:
- Approved transport plan
- Route and vehicle schedules
- Customer delivery requirements
- Transport-performance targets
- Dispatch records
- Vehicle-tracking information
- Proof-of-delivery documents
- Load and quantity records
- Damage and return reports
- Transport cost reports
- Fuel and toll records
- Vehicle inspection records
- Driver and licence records
- Risk-management checklist
- Customer complaints
- Previous performance reports
Use data from the same reporting period and verify its accuracy.
2. Prepare a transport-monitoring register
Record every scheduled delivery.
| Delivery | Route | Customer | Planned time | Actual time | Planned quantity | Actual quantity | Status |
|---|---|---|---|---|---|---|---|
| DEL-101 | R01 | Customer A | 10:00 | 09:45 | 500 | 500 | Complete |
| DEL-102 | R02 | Customer B | 12:00 | 14:00 | 400 | 350 | Late and short |
Link each transaction to the relevant route, vehicle, driver and proof of delivery.
3. Measure on-time delivery
Define “on time” using the approved delivery date and customer time window.
Use:
On-time delivery rate = Deliveries completed on time ÷ Total deliveries due × 100
Example:
- Deliveries due: 100
- Deliveries completed on time: 92
On-time delivery rate = 92 ÷ 100 × 100 = 92%
Compare the result with the target.
Record late deliveries by:
- Route
- Customer
- Vehicle
- Driver
- Delay duration
- Cause
- Customer priority
4. Measure delivery in full
A delivery is in full when the customer receives the complete required quantity.
Use:
In-full delivery rate = Deliveries completed in full ÷ Total deliveries due × 100
You may also calculate:
Unit fill rate = Units delivered ÷ Units ordered × 100
Do not count a partially delivered order as an in-full delivery.
Delivery performance
| Delivery | Ordered | Delivered | Short quantity | In full? |
|---|---|---|---|---|
| DEL-101 | 500 | 500 | 0 | Yes |
| DEL-102 | 400 | 350 | 50 | No |
5. Measure OTIF
On-Time In-Full (OTIF) measures deliveries that satisfy both the agreed time and complete-quantity requirements.
OTIF = Deliveries completed on time and in full ÷ Total deliveries due × 100
A delivery that is on time but short does not qualify. A complete but late delivery also does not qualify.
6. Monitor delivery damage
Record:
- Delivery and product
- Quantity transported
- Quantity damaged
- Type of damage
- Point at which damage was discovered
- Packaging condition
- Loading and securing method
- Vehicle condition
- Customer response
- Recovery or claim action
Use:
Damage rate = Damaged units ÷ Total units delivered × 100
or:
Damage-free delivery rate = Damage-free deliveries ÷ Total deliveries × 100
Use the measure specified by the operational plan.
7. Monitor delivery returns
Identify products returned because of:
- Transport damage
- Incorrect delivery
- Late arrival
- Customer rejection
- Incomplete documents
- Product-quality failure
- Excess quantity
- Wrong delivery location
Use:
Delivery return rate = Returned units ÷ Total units delivered × 100
Separate transport-related returns from failures caused by warehousing, production, suppliers or customers.
8. Compare delivery cost with budget
Include relevant costs such as:
- Vehicle operating costs
- Fuel
- Drivers
- Tolls
- Third-party transport
- Overtime
- Redeliveries
- Emergency transport
- Damage and return costs
Use:
Cost variance = Budgeted delivery cost − Actual delivery cost
A negative result indicates an overspend.
Calculate:
Cost per delivery = Total transport cost ÷ Number of completed deliveries
Cost per unit = Total transport cost ÷ Units delivered
Cost-performance schedule
| Cost item | Budget | Actual | Variance | Status |
|---|---|---|---|---|
| Fuel | R80,000 | R92,000 | −R12,000 | Over budget |
| External transport | R30,000 | R45,000 | −R15,000 | Over budget |
| Redelivery | R5,000 | R11,000 | −R6,000 | Over budget |
9. Monitor risk-management compliance
Assess whether transport operations complied with required controls.
Check:
- Vehicle roadworthiness
- Driver licences and authorisations
- Pre-trip inspections
- Load limits
- Load securing
- Route-risk assessments
- Product-handling requirements
- Temperature controls
- Tracking and communication
- Incident reporting
- Security requirements
- Emergency procedures
- Required documentation
- Approved transport providers
Risk-compliance rate
Compliance rate = Compliant checks ÷ Total applicable checks × 100
Record every failed or missing control and assess its potential effect.
10. Prepare the transport scorecard
| Performance area | Target | Actual | Variance | Status |
|---|---|---|---|---|
| On-time delivery | 95% | 92% | −3% | Below target |
| In-full delivery | 98% | 94% | −4% | Below target |
| OTIF | 94% | 89% | −5% | Below target |
| Damage-free delivery | 99% | 97% | −2% | Below target |
| Cost per delivery | R1,500 | R1,650 | R150 over | Below target |
| Risk compliance | 100% | 96% | −4% | Below target |
Support every result with traceable data.
11. Identify performance gaps
For each KPI:
- Confirm the target.
- Calculate actual performance.
- Determine the variance.
- Classify the result.
- Identify affected customers or routes.
- Assess the operational and financial effect.
- Prioritise the required response.
Focus on repeated or high-impact failures.
12. Determine root causes
Investigate non-performance across the transport process.
| Area | Possible root cause |
|---|---|
| Planning | Unrealistic route or travel time |
| Warehouse | Picking or loading completed late |
| Vehicle | Breakdown or inadequate capacity |
| Driver | Absence, incorrect route or non-compliance |
| Inventory | Stock unavailable before dispatch |
| Packaging | Goods inadequately protected |
| Customer | Incorrect address or site closed |
| External | Road closure, border delay or severe weather |
| System | Incorrect route or tracking information |
Use supporting records and a method such as the Five Whys.
Root-cause register
| Performance gap | Immediate cause | Root cause | Responsible area | Effect |
|---|---|---|---|---|
| Late deliveries | Vehicles departed late | Picking missed dispatch cut-off | Warehouse | Customer SLA failure |
| High damage rate | Loads shifted in transit | Inadequate load securing | Transport | Returns and replacement cost |
13. Take immediate recovery action
Service recovery restores the affected customer’s position as quickly as possible.
Possible actions include:
- Notify the customer.
- Provide accurate progress information.
- Arrange an urgent or replacement delivery.
- Deliver outstanding quantities.
- Replace damaged products.
- Correct delivery documents.
- Allocate an alternative vehicle.
- Re-route the load.
- Use an approved transporter.
- Arrange collection of rejected goods.
- Escalate a critical delivery.
Record the customer’s agreed resolution.
14. Develop the service-recovery plan
| Failure | Affected customer | Immediate recovery | Permanent corrective action | Owner | Due date |
|---|---|---|---|---|---|
| Short delivery | Customer B | Deliver 50 units next day | Improve load verification | Dispatch manager | 15 July |
| Damaged load | Customer C | Replace damaged stock | Retrain loading team | Transport manager | 20 July |
Include:
- Performance gap
- Root cause
- Customer effect
- Immediate containment
- Recovery commitment
- Responsible person
- Required resources
- Completion date
- Customer communication
- Success measure
15. Monitor recovery and improvement
Track:
- Outstanding quantities
- Replacement deliveries
- Customer confirmations
- Corrective-action completion
- New KPI results
- Recurring incidents
- Cost of recovery
- Open risks
Close the recovery action only after verifying that the customer commitment has been fulfilled and the underlying cause has been addressed.
16. Prepare the transport-performance report
Include:
- Reporting period
- Targets and actual results
- Variances
- Late and short deliveries
- Damage and return results
- Cost performance
- Risk compliance
- Root causes
- Service-recovery actions
- Responsible persons and dates
- Remaining risks
- Recommendations
Practical task
You are provided with transport-performance reports, delivery records, operational targets, cost information and risk criteria.
Complete the following:
- Validate the supplied performance data.
- Calculate on-time delivery.
- Calculate in-full delivery and OTIF.
- Calculate delivery damage and return performance.
- Compare delivery costs with the budget.
- Measure risk-management compliance.
- Prepare a transport-performance scorecard.
- Identify and investigate performance gaps.
- Conduct root-cause analysis.
- Develop a service-recovery plan.
- Prepare and submit a transport-performance report.
Required evidence
Include the following in your Portfolio of Evidence:
- Source transport plan and performance targets
- Transport-monitoring register
- On-time, in-full and OTIF calculations
- Damage and return calculations
- Cost-performance calculations
- Risk-compliance assessment
- Transport scorecard
- Performance-gap and root-cause registers
- Customer recovery communications
- Service-recovery plan
- Transport-performance report
- Evidence of review or approval
- Completed observation checklist
- Learner declaration of authenticity
Competence checklist
| Assessment criterion | Competent | Not yet competent | Comments |
|---|---|---|---|
| Validate transport-performance information | |||
| Measure and monitor on-time delivery | |||
| Measure and monitor delivery in full | |||
| Calculate OTIF accurately | |||
| Measure delivery damage | |||
| Measure delivery returns | |||
| Compare delivery costs with the budget | |||
| Measure transport-risk compliance | |||
| Compare actual performance with targets | |||
| Identify root causes of non-performance | |||
| Develop an appropriate service-recovery plan | |||
| Monitor recovery actions | |||
| Prepare a comprehensive performance report | |||
| Submit complete supporting evidence |
Lesson Summary
To monitor transport and distribution performance, validate operational records and measure actual results against approved targets. Calculate on-time delivery, delivery-in-full, OTIF, damage, returns, costs and risk compliance. Investigate material performance gaps to determine their root causes and effects on customers and operations. Implement immediate recovery actions, develop permanent corrective measures, and monitor them until customer commitments and performance requirements are achieved.