On Time in Full (OTIF) KPI Guide: Definition, Formulas, Tips, Practical Applications

On Time In Full (OTIF) KPI Guide
Definition, formulas, tips, practical applications
© QPR Software
What is OTIF?
OTIF is a KPI applicable in almost all industries, such as

manufacturing and services, in both B2B and B2C
businesses.
OTIF is typically related to the Order-to-Cash process and

a corner stone of customer satisfaction - did customers get
what they ordered and when it was promised?
OTIF calculation often varies depending on the

organization’s goals. However, some common
characteristics can be identified.
© QPR Software | www.qpr.com

OTIF Definition
OTIF consists of two parts - on time & in full. It is often
used as a KPI measuring the efficiency and accuracy of
delivery in supply chain.
Delivered On Time
• Organizations define a time which they should be able to reach.
• This can be requested delivery date, production cycle, or agreed
response time.
• One typical on time criteria is that the delivery should not be late.
However, what is equally important is that the delivery should not be too
early either. If a case is closed much faster than average, it typically
means some exceptions have been made.
Delivered In Full
• The most common way to define in full is that customer gets exactly the
amount they have ordered.
• However, for example in medical industry, the manufactured batch size
varies, and the in full criteria should be defined so that customer gets at
least the amount they have ordered.

OTIF Formulas
On Time In Full =
(Cases matching the criteria) / (Total number of cases)
On Time = (Delivery time) - (Confirmed delivery time)
• In this case, the organization should be able to match a promised

delivery time and there is no lower limit, meaning it is not a problem if a
case is delivered very early.
• Target: => 0
In Full = (Delivered amount) - (Confirmed amount)
• Target: = 0, if the delivered amount should be exactly what is promised.

Calculate OTIF KPI Using Process Mining
With process mining, OTIF is calculated on a case level

based on the number of order lines that were delivered On
Time In Full.
This is the right way to do it to reveal process capability.
Basing the calculation on delivered tons or euros puts
weight on big orders. For a well-functioning process, the
size of the order is an irrelevant factor. Both small and big
orders are delivered as promised. By weighting big orders
in calculations, many unsuccessful small orders can be
hidden behind the averages. This will not provide truthful
and accurate information of the process performance.

Process mining uses transactional event data to visualize
individual process cases and calculate process KPIs like
OTIF.
Process mining provides full drill down capability from, for
instance, OTIF KPI, to the list of individual orders that
didn’t fulfill the OTIF criteria.
No datamarts or cubes are used between the transactional
data and the management report hiding calculation and
data transformation rules.
There is no need to suspect or argue the results, as the
facts on lowest level of detail are available, and calculation
rules are transparent. Any KPI with unexpected results can
be broken down to the order line level to see what went
wrong.

Learn more about process mining
3 Tips to Cut Lead Time in Half
1) Identify and reduce changes
2) Make sure you know where the

bottlenecks are
3) Automate in right places

1) Identify and reduce changes
Conduct process
analysis to gain a
better understanding
of why the OTIF KPI
is not met.
Some analysis
examples are:
• Requested delivery vs
outbound delivery
• Delivered once vs
delivered
several times

2) Make sure you know where the bottlenecks are
Late deliveries:
• In order to locate root causes for deliveries that take longer than
average, run a duration analysis and select the relevant cases for
influence analysis.

Recurring deliveries:
• In order to locate root causes for deliveries that delivered more
than once, select the looping events for influence analysis.

3) Automate in right places
As you identify changes and bottlenecks for improvement, your OTIF
KPI should look better than before the improvements.
To take it further, you can work on reducing the variations and improving the
conformance.
As the compliance improves, some of your subprocess should be ready and
beneficial for automation, reducing human errors and improving the KPI.

Practical Applications - OTIF in Manufacturing (Forestry)
▪ Delivered when delivery has been promised.
▪ Delivered the amount customer has requested .
→ Reduced the amount of business critical changes by 55%. Jari Vuori
VP Supply Chain
Improving supply chain based on data – analysis of real process “The process insight and facts delivered
by QPR ProcessAnalyzer were
Customer Needs priceless. We were immediately able to
Predictability needed to be improved and operating models harmonized in focus our process improvement
order to respond better to customer needs and requests. activities to the right things to reach the
Understanding the real status of the Order-to-Cash process through a results our business needed. And not
process analysis based on SAP data. wasting time on trial and error.”
Overall goals: Improve delivery accuracy, improve production efficiency,
optimize stock rotation, reduce number of changes. Company Overview
Metsä Board is a leading European board
producer and pulp supplier. In 2016,
Solution Metsä Board’s sales totaled EUR 1.7
With the help of QPR ProcessAnalyzer and QPR’s connector for SAP, Metsä billion and has approximately 2,500
Board gained fact-based insights into their process performance and employees.
efficiency through end-to-end process analyses on their SAP data.
Customer interview with Matti Ketonen,
Benefits VP Supply Chain:
QPR ProcessAnalyzer’s process visualization feature revealed the influence
of order changes being the bottleneck of Metsä Board’s Order to Cash
process efficiency, and the root causes being ad-hoc requests and internal
adjustments.
Process analysis results allowed Metsä Board to focus on fixing the root
causes by training personnel on agreed process guidelines to drive internal
efficiency, rather than investing further in SAP development.

Practical Applications - OTIF in services (infra services)
▪ Delivered within 7 days of the request.
▪ No need to order spare parts = able to fix immediately
̶ Note! If this fails, it usually has also an impact on the first criteria.
▪ Invoice immediately after the assigment has been completed.
▪ → Harmonized especially invoicing lead times and shortened them from up to 3 months to an
average of 10 days.
Improved invoicing through data-driven process insight
Customer Needs
Harmonization of core processes due to demerger, including sales, Aila Aaltonen
financial, project and service processes. CIO
Cash flow slowed down after rolling out a harmonized ad hoc
service process and SAP in three countries.
“With QPR ProcessAnalyzer, we
How to identify process bottlenecks? were able to see the whole Ad Hoc
Solution Service process. Without the data
and the product we wouldn’t have
As-is process visualization and root cause analysis using QPR's been able to discover the reasons
connector for SAP and QPR ProcessAnalyzer. behind the process bottlenecks.”
Benefits
Quicker invoicing and improved cash flow from discovering and Company Overview
removing process bottlenecks. Caverion was established through a
Important process performance indicators and KPIs are put in demerger. Caverion provides building
systems and industrial services in
place for measuring process effectiveness, monitoring the results Europe. Caverion has approximately
of corrective actions, and comparing process performance and 17,000 employees in 13 countries.
variations on a country basis.

Common Q&As
1. How long does it take to set up the OTIF KPI?

• The biggest effort is usually required to select the criteria for the KPI, implementation
is usually a matter of hours.
2. What if the criteria changes?
• This is natural behavior and happens often; I encourage my customers to review their
Process KPIs on regular basis and see where the focus should be.
3. Is OTIF orderline or order related or could it be both?

• It can be both.
4. Is it only possible to extract data from automated processes?

• No, the process does not have to be automated; there just needs to be data available
of the execution of the process. For example, a sales process executed with the
support of ERP but performed completely by an actual person can be used as source
for data.
5. Can you extract the data from ERP – e.g. Oracle and SAP for this analysis?
• Yes. SAP and Oracle – along with many others - are actually very good source
systems from process mining point of view.

How can we help?
Do you have questions regarding this OTIF KPI guide?
Would you like to speak to our experts to learn more

about how process mining can help improve your KPI and
streamline processes?
Chat with us today

Founded Sold licenses Products
1991 >1 million worldwide QPR Metrics
Corporate headquarters Customers QPR ProcessDesigner
Helsinki, Finland 2000+ QPR ProcessAnalyzer
Stock symbol Industry recognitions QPR EnterpriseArchitect
QPR1V: Nasdaq Helsinki Gartner, Ventana Research, Palladium,
Forrester Research

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On Time In Full (OTIF) KPI Guide

Definition, formulas, tips, practical applications

OTIF is a KPI applicable in almost all industries, such as

OTIF is typically related to the Order-to-Cash process and

OTIF calculation often varies depending on the

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

On Time = (Delivery time) - (Confirmed delivery time)

• In this case, the organization should be able to match a promised

In Full = (Delivered amount) - (Confirmed amount)

• Target: = 0, if the delivered amount should be exactly what is promised.

© QPR Software | www.qpr.com

With process mining, OTIF is calculated on a case level

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

1) Identify and reduce changes

2) Make sure you know where the

3) Automate in right places

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

© QPR Software | www.qpr.com

1. How long does it take to set up the OTIF KPI?

3. Is OTIF orderline or order related or could it be both?

4. Is it only possible to extract data from automated processes?

© QPR Software | www.qpr.com

Would you like to speak to our experts to learn more

Chat with us today

© QPR Software | www.qpr.com

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