Introduction to POI
POI stands for “Perfect Order Index.” Perfect order performance is a key performance indicator that strongly predicts customer satisfaction. POI serves as a barometer of how well a company is fulfilling expectations.
POI is a commonly used measurement tool (key performance indicator) used in the distribution world that allows an organization to objectively measure its order delivery performance against criteria that retailers and other customers have agreed is important.
So what is the perfect order? In the basic sense, an order can be classed as being perfect if it meets certain criteria. In short, it is an order containing the correct product/service that reaches the correct customer in the correct place at the right time. Therefore, the perfect order consists of:
- On-Time: Was the order shipped on time?
- customer ship date in NS
- Complete: Was the order complete the first time we shipped it?
- The full order shipped complete on the first shipment
- Damage-Free: Did the order arrive at the customer free of damage?
- Documentation – Did we include the accurate documentation along with the shipped order? (ASN, electronic documents)
When we answer yes to all of the above on a particular order, we can confidently say that “we shipped that order perfectly.”
Reporting POI
Compliance reports on a monthly basis the company’s POI numbers and leads and coordinates inter-departmental efforts to resolve underlying issues to improve POI. Refer to Monthly POI Data Review for more details specific to department roles.
Why is POI important for Advantus?
Customers have high expectations that every order will be perfect. POI performance is a strong predictor of the health of a business as well as customer satisfaction.
Achieving perfect order performance transcends silos inside the company, making everyone equally accountable for success in the eyes of the customer. Eliminating order errors doesn’t just make customers happy, it saves the business money.
How is POI Calculated?
POI is calculated by multiplying the results of the 4 individual metrics together: (Percentage of orders delivered complete X percentage of orders delivered on time X percentage of orders received damage-free X percentage of orders with correct documentation) X 100