Service level is measured in %
Target measures Delivery Level Quantity – Availability
If 100 sales units have been ordered and 98 sales units are delivered at first delivery, the service level is 98%.
Target measure At the right time – Reliability
If there are 10 orders placed for delivery at a specific date, the deliveries should have arrived at the specific dates / time slots and 1 of the deliveries arrive before or after the agreed date / time slot, the service level is 90%.
Target measures Correct Administration – Security
Example 1:
Out of 10 orders, 1 invoice has a price error. An invoice for another order contains items reported to the vendor with errors on arrival. The delivery on the third order is missing Despatch Advice.
These 3 errors generate 3 credit notes / deviations and service level is 70%.
Example 2:
Out of 10 orders, 1 of the orders on the invoice has a price error on a product and another item on the same invoice has an error / defect reported to the supplier.
If the errors can be corrected on a single credit note, the service level is 90%.
