Promise Compliance Rate (PCR)

Using VRO, the Customer knows before supplier's shipment what it will be able to deliver. This is what we call the Supplier Promise. Based on this Promise, the Customer is going to schedule its production and its global activity.

If this Promise is not respected, the Customer will be heavily impacted because its organisation has been defined based on this Promise.

The Promise Compliance Rate is the measure of the respect of the Promise. Like the VRO Service Rate, it is measured based on lines where the promised quantity has been delivered at least in full (in the transportation linked to the Pick-Up Order). One exception: the quantity can be higher than the promised quantity but has to be lower or equal to the quantity initialy ordered. One condition: if the Promise has not been sent or sent late, the result is 0.
The Promise Compliance Rate is cumulated like the Service Rate.

The Promise Compliance Rate is the most important KPI to run a VRO.

You have to request Suppliers to reach a PCR at 100% before asking a Service Rate at 100%. The PCR depends only to the willing of Suppliers: it is their own commitment. Learn more about how to help a supplier to improve its PCR...

Part number	Quantity ordered	Quantity Promised	Quantity Delivered	Promise Compliance Rate	Comment
A	10	10	10	100%	Quantity promised delivered in full: 100%.
B	10	10	8	0%	Quantity promised not delivered: 0%.
C	10	8	8	100%**	Quantity promised delivered in full: 100%.
D	10	8	9	100%**	Quantity promised delivered in full and lower or equal to the quantity ordered: 100%.
E	10	10	11	0%	Quantity delivered higher than quantity ordered: 0%. This is also an incident.
F	10	8	11	0%	Quantity delivered higher than quantity ordered: 0%. This is also an incident.
G	0	0	0	NA*	Not applicable.
H	0	1	0	NA*	Not applicable but promising a quantity when there is no quantity ordered is an incident.
I	0	1	1	NA*	Not applicable but promising a quantity when there is no quantity ordered is an incident. An other incident is generated because it is an overshipment.
J	10	No Promise	10	0%	No promise for a quantity ordered: 0%, even if the quantity ordered is delivered in full. It creates also an incident.
K	10	Promise late	10	0%	Promise late for a quantity ordered: 0%, even if the quantity ordered is delivered in full. It creates also an incident.

* we consider only Promises done when a quantity is ordered.
** line delivered with a quantity between the Quantity Promised and the Quantity ordered (both included).

Lines ordered	Lines promised in full	Promise Compliance Rate
8	3	3 / 8 = 38%

Supplier KPI Delivery performance but also adherence at the process are 2 aspects to be tracked in order to assess Supplier's performance.

VRO Incidents To keep your VRO efficient, it is important to record the non respect of its key steps.

Improving the Supplier PCR How to improve the reliability of the Supplier Promise.

Service Rate Classical KPI adapted to the VRO.

VRO Discrepancies Discrepancies management is a time consumming process. So it is important to highlight them during reviews with Suppliers.

VRO Supplier KPI report A simple file to record and present VRO Supplier KPI.

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Promise Compliance Rate (PCR)

The Promise Compliance Rate

Example of a Pick-Up Order

For the Pick-Up Order

VRO KPI

Ordering KPI

Discrepancies Management