What is OTIF?

 

OTIF means On Time and In Full, where the customer receives the completed order when they wanted it and in the quantity ordered.

OTIF is a key supply chain metric. It is generally calculated as a percentage of total deliveries that were complete and on time. This metric is also known as Perfect Order Proficiency.

For retailers and CPG companies, OTIF is important because it means that the product is on the shelf when the consumer is ready to buy. According to McKinsey, “The US food retail industry loses an estimated $15–20 billion in sales every year because items are out of stock or otherwise unsaleable. That’s around two to three percent of its total sales.” And these incremental revenues could have a significant impact on profitability.

Multiply that challenge across industries, and there is a tremendous amount of potential value in the supply chain. Unlocking the value is not easy for a variety of reasons. Supply-chain complexity is increasing with the proliferation of products and SKUs. Next, the OTIF process involves multiple parties (a retailer, a supplier and a carrier), so the challenge is compounded because most organizations lean on their ERP systems to calculate OTIF. ERP typically does not have visibility beyond the “four walls” of the enterprise, and so it’s often difficult for trading partners to collaborate to optimize OTIF with legacy systems.

One Network’s Perspective on On Time and In Full

One Network maximizes OTIF performance. Our NEO Platform is a multi-party network platform that provides full supply chain visibility and enables all trading partners to collaborate on delivering the right products at the right time in the right quantity. One Network can perform global demand supply matching using real time information to optimize service levels for the highest possible OTIF performance

The Network provides a Single Version of the Truth (SVOT) so all parties have access to real-time, authoritative data.  This is especially important when computing OTIF metrics, as traditionally every company computes different OTIF rates because they may be using differing data sets and assumptions.  One Network’s NEO intelligent agents can monitor milestones, trigger alerts, and help resolve issues early – before they negatively affect OTIF performance.

On-Time In-Full Resources

Fixing Grocery Retail's 10 Billion Dollar Problem

This report explains a simple solution that dramatically boosts OTIF performance and enables significant benefits for both suppliers and retailers.

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McKinsey & Company

Defining On-Time In-Full in the Consumer Sector

Managing modern consumer-goods supply chains is demanding, but measuring supply-chain performance should be simple. It isn’t yet—because of an inconsistent approach to the critical OTIF metric.

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Optimizing OTIF Performance in CPG and Retail

With aggressive OTIF targets being set by major retailers, new strategies and technologies are required to meet them and to ensure high service levels, minimize chargebacks, and maximize competitiveness. Learn how the NEO Platform Platform and NEO agents ensure better planning, tracking, managing and optimization of OTIF performance.

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