My initial exposure to the importance of delivery performance goes back to my early corporate days when a “Visionary” joined the company I was working for. He joined as the Managing Director and immediately changed the organisation’s focus. One of his initiatives was to look at our business from the customer’s perspective.

At that time we were the major supplier of paint to the Australian market and were in competition with a number of paint suppliers, both large and small. The reason that the competition was so tight was that although our product was very good (my bias says it was the best with definite technical feature which would benefit our customers), our customer could only receive our products when they wanted it about 60% of the time. Hence they had to settle for an inferior product 40% of the time. This was not good enough and it took the eyes of a new person to recognise that we could do better and in the process, develop a competitive advantage, which the organisation maintains today.

There was far more involved in the “Customer First” program that was developed than just focusing on delivery performance. But to an impressionable young graduate, the improvement I saw was a steep upward trend in our delivery performance. From these early beginnings, I then understood how important the customer was. Sam Walton (of Wal-Mart) highlights the importance of the customer:

There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.

So how does delivery performance improvement affect the SME’s in Australia? How many times have you been into a retail shop only to find the product you wanted was not available? I faced this situation recently. I wanted a specific product, which the retailer said was imported from Spain and was currently “on the water.” I assumed that at the worst it would be an 8 week wait which I was prepared for. I waited for 3 months and was not once contacted by the retailer. In the end, I purchased an alternative product. A further 3 months later, I was rung by the original retailer and asked if I was still interested in buying their product as it had just arrived. How does this business expect to be successful and grow with such an arrogant attitude?

Other examples that demonstrating the importance of on time delivery are in the mining and automotive industry. In the mining industry, shut downs are scheduled for maintenance and repair work. Purchases are planned, orders placed and delivery expected in time for the shutdown. Late delivery is not an option. Work done during these shut down affects the mine’s productivity and their OH&S. Failure to complete the scheduled work can be catastrophic. Similarly, the production line of an automotive plant demands on time delivery of all products. Retrofitting automotive parts is expensive and unproductive. Failure to deliver to the Automotive and Mining industry will lead to loss of business and potentially claims, which are hard to ignore. Finally, an example which is more common to all of us is being promised by electricians and plumbers that they will be at you house at a certain time, only to still be waiting some days later.

I believe the health of an organisation can be judged by its attitude to all customers. We must have our primary focus on the customer’s perspective; how they see things. An easy measure of this is the business’ delivery performance. When meeting with an organisation, one of my first objectives is to determine their attitude to their customers, which I base on their delivery performance (it is generally worse than the business thinks). Do they even measure the delivery of their service or products? Once quantified, issues around delivery can quickly be identified and corrected. Attention around delivery sends a message to all employees that supply of products and/or services to customers in full and on time every time is important. This very important change heralds to all employees that the business orientating towards a customer focus has commenced, and although much work needs to be undertaken to truly walk in the customer’s shoes, a small but important step has been taken to move the business’ culture.

Another benefit of this focus is the need to understand what your customers expectation are and what you need to do to meet and exceed those requirements. Too often we as business owners are informed by our customers that our delivery is late. A better approach is for businesses to inform customers within a reasonable time (prior to the due date) if a delivery date cannot be achieved. Agreement can then be reached about new delivery expectations (by the way if a new delivery time is agreed, this date is non-negotiable if the account is to be maintained). If an alternative delivery time is not an option, early detection of a pending late delivery allows customer discussion and the exploration of alternative solutions.

I know which approach I would prefer.

In my last business, Delivery In Full & On Time (DIFOT) averaged above 95% (still room for improvement) and this set my business up with a significant competitive advantage as none of our competitors could regularly deliver this performance.

What is your business' Delivery Performance?

 If you would like to discuss this further or review any aspects of your business please contact Robert on This email address is being protected from spambots. You need JavaScript enabled to view it.  for a 16 point business audit and report