For companies with warehousing and distribution as a core business, the use of key figures or KPIs (Key Performance Indicators) is often decisive for how effectively the companies are steered towards profitability and growth. This is something that applies to the highest degree in the world of e-commerce. A strong trend is that more and more e-commerce companies are measuring and following up operations both more frequently and at a more detailed level than before. And above all, more frequently and in more detail than is done in many other types of business.
For expansive e-commerce companies, it's not about monthly performance follow-ups, but rather about keeping track of the situation on a weekly, daily or in some cases hourly basis. It is the key figures that provide insight, but in order to gain full control over KPIs such as stock turnover rate, service level, delivery quality, overstock and capital tie-up, it is necessary to successfully implement the use of the key figures. A quote from an article by the consulting company Fellowmind illustrates in a good way how important it is: "The most common reason why e-commerce companies, which on paper are growing with profit, still end up with empty cash registers, is an excessively high inventory tie-up".
Although the use of KPIs is becoming more common, the article shows that many companies can become better at producing important key figures and then also ensuring that they are actually used in an organization. When key figures are made available on dashboards, it becomes much easier for companies to internally motivate and increase understanding of why the KPIs are important, and get employees in purchasing and warehouse working towards the same goal. Here we will look at the possibilities SOLO Dashboard provides to get full control of the most important KPIs for inventory control and purchasing planning.
Developed with Microsoft Power BI
Translated, the word dashboard means dashboard in Swedish, and with easy-to-understand diagrams and an educational layout, there are actually similarities between the SOLO Dashboard and the dashboard of a newer car. Not just in terms of appearance. When driving, you can glance at the dashboard to get a quick overview of speed and consumption, and adjust your driving accordingly. For example, for a buyer with access to the SOLO Dashboard, it is easy to control purchases and make adjustments by always having access to updated key figures.
For our customers who have automated and digitized purchases and inventory management with the SOLO system, one of the big gains is that you get rid of the problems that arise with personal purchasing decisions. Everyone works in unison, and that will also be the effect with the SOLO Dashboard. You steer in the same direction and towards the same goal when everyone knows which key figures apply!
SOLO Dashboard is developed with the scalable data analysis tool Microsoft Power BI. Power BI is built to create simplicity, and that makes Promosoft's dashboard very easy to use. It's an interactive analytics tool that really helps our clients reach their set KPIs.
Choose the right KPIs, and not too many!
Professor Bino Catasus at Stockholm University is passionate about numbers and how people are influenced, act and driven by key figures. He believes that many companies make the mistake of trying to manage too many key figures. This leads to problems such as it drains resources and not seeing the forest for all the trees. Catasus refers to research that shows that humans can hold approximately seven things in their heads at the same time. He therefore believes that it can serve as a good rule of thumb for the number of KPIs in a company. For inventory management and purchasing planning, there are usually about as many KPIs as are usually current and can be followed with the SOLO Dashboard.
It is quite common for the SMART concept to be used to define KPIs. SMART stands for Specific, Measurable, Acceptable, Relevant and Timed. The method is also used in purchasing and inventory management, but at the same time there are a number of KPIs that run like a common thread through companies where inventory and distribution are the core business. This facilitates the choice of key figures, but of course it can be the case that there are differences in ranking and importance between different companies.
Some of the most important KPIs for Promosoft's customers are service level, inventory turnover rate, inventory value, delivery quality, lead time accuracy, overstock, capital tied up and forecasting. These are key figures where the SOLO Dashboard makes it easy to follow developments and quickly make the adjustments that may be required to achieve set goals. It is also possible to add your own KPIs. It's about Business Intelligence - developing a business with the right key figures as a control instrument!
Overview, look ahead and look back and drill-down with in-depth analyses
With the SOLO Dashboard, it is possible to quickly draw conclusions based on the enormous amount of data contained in the SOLO system, and also all the data contained in an integrated business system. The dashboard can be tailored so that all employees in purchasing and warehouse management get the tool they need. Reports can be visualized as tables, bar charts and graphs. It is easy to go from a quick overview to in-depth with the drill-drow function for those who want to delve into one or more KPIs.
Our customers have had access to the Dashboard in SOLO for many years. The tool has been developed continuously and an important step was when a new version was launched just over five years ago. Among other things, it opened completely new possibilities for sorting, grouping and breaking down the key figures on, for example, A items, product categories, brands and suppliers. Now it was also possible to follow the level of service for the entire range both in the present and back in time, and to see how good the service is for a selected part of the range. For a company where a reduced inventory is a priority goal, SOLO Dashboard also quickly informs you of how much the inventory can be reduced in a couple of years' time if the inventory management takes place based on the parameters that apply today.
The list of all possibilities with SOLO Dashboard can be made long! If you are in a situation where you are experiencing problems with defining important KPIs for your business and/or implementing a consistent use of key figures, we are happy to help you. We can tell you about the importance the dashboard has had for many of our customers while at the same time showing how flexible our BI tool is, and how easily it can be tailored to your business!