The OTIF Indicator (On-Time-In-Full) is a measure that is used in the supply chain to assess the effectiveness of suppliers and to monitor the fulfillment of customer expectations in terms of timeliness and completeness of deliveries. It is expressed as the percentage of deliveries that meet both criteria: punctuality (delivery at the agreed time) and completeness (delivery of all ordered products without shortages).
A high OTIF means that the company delivers products to customers on time and according to expectations for completeness, which increases customer satisfaction and loyalty. This may often result in avoiding contractual penalties for late delivery, which increases profitability.
On the other hand, a low OTIF indicates that the company is not delivering products on time and/or in line with customer expectations, leading to customer dissatisfaction and increasing the risk of loss of trust. It also reduces the company's credibility and competitiveness on the market, resulting in a reduction in the number of orders and loss of contractors.
The OTIF indicator contains two components:
- On-Time: gives information on how many deliveries were delivered at the agreed time or before the waiting time expired. To assess on-time delivery, you can compare the delivery date with the expected or agreed delivery date.
- Completeness (In-Full): informs how many deliveries were complete and contained all the ordered products without any quantity or quality deficiencies. This can be assessed by comparing the number of products ordered with the number of products delivered and identifying any shortages in the delivered products.
It is very important to emphasize that as part of the completeness of products, we take into account the quality aspect. This means that the order must be delivered complete and in perfect condition - without any damage that occurred, for example, as a result of logistic activities such as packaging, transport, etc.
How to calculate OTIF?
To calculate the OTIF indicator, divide the number of orders that were delivered on time, without quantity and quality deficiencies, by the total number of orders.
Example:
If 90 complete and quality orders were delivered on time in a month and the total number of orders during this period was 100, the OTIF indicator is 90%.
