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OTIF (On-Time In-Full) is a critical supply chain metric that measures a company's ability to deliver orders on time and in full quantity as requested by customers[1][2]. It consists of two main components:

  1. On-Time: Assesses whether outgoing orders arrive within the agreed-upon delivery window[1].
  2. In-Full: Evaluates if the correct volume and specifications were delivered[1][2].

Calculation

The OTIF formula is:

OTIF Rate = (Total deliveries made on time and in full / Total deliveries made) × 100[2][3]

For example, if a company receives 600 orders and 455 are delivered on time and in full, the OTIF rate would be:

455 / 600 × 100 = 75.8%[2]

Importance in Supply Chain Management

OTIF is crucial for businesses because it:

  1. Indicates product availability when consumers are ready to buy[3].
  2. Helps identify recurring issues in the supply chain[1].
  3. Affects a company's bottom line through potential fines and lost sales[2].
  4. Serves as a benchmark for measuring supply chain initiatives' success[4].

Improving OTIF Performance

To optimize OTIF scores, businesses can:

  1. Establish standardized OTIF targets across product lines[3].
  2. Invest in real-time supply chain visibility technologies[3][4].
  3. Improve demand forecasting and inventory management[4].
  4. Strengthen supplier collaboration[4].
  5. Streamline logistics operations[4].

By focusing on these areas, companies can enhance their OTIF performance, leading to improved customer satisfaction and operational efficiency.

Citations: [1] https://www.slimstock.com/blog/otif-guide/ [2] https://www.unleashedsoftware.com/blog/otif/ [3] https://www.adaptideations.com/otif-in-the-supply-chain-what-is-it-and-how-to-calculate-it [4] https://www.mrpeasy.com/blog/on-time-in-full-otif/ [5] https://www.fourkites.com/blogs/maximizing-on-time-in-full-otif-in-the-supply-chain/ [6] https://www.shipbob.com/blog/otif/ [7] https://www.celonis.com/blog/otif-explained-the-what-why-and-how-of-optimizing-for-on-time-in-full-delivery/ [8] https://www.transvirtual.com/us/blog/what-is-on-time-in-full-otif-in-supply-chain-management/

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