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What a good DIFOT actually is.
Delivered In Full, On Time. What it means, how it is calculated, what counts as good in Australian operations, and the four definition choices that move the number more than performance does.
The measure
Orders delivered in full and on time, divided by total orders delivered, times one hundred. An order passes only if it passes both tests. Complete but a day late fails. On the right day but one line short fails. That is the whole definition, and it is the reason DIFOT is harder on an operation than either half measured alone.
What counts as good
There is no official standard. What follows is what gets said in Australian operations rather than a published benchmark, and it is only useful once your own definition is stable.
| Range | What it usually means |
|---|---|
| Under 90% | Your customers have already noticed. Expect it to be raised in a review meeting before you raise it internally. |
| 90 to 94% | Common, and almost always improvable without spending money. Usually a handful of repeat causes rather than a broad problem. |
| 95 to 98% | A well run operation. Getting further costs real money, so this is where it pays to know what the next point is worth before chasing it. |
| Above 98% | Either excellent or the measure has been made easy. Worth checking which before putting it in a board pack. |
Grocery and large retail supply agreements often mandate the high 90s with penalties attached, so for suppliers into those channels the target is set by the contract rather than by ambition.
The four choices that move the number
When two systems in the same business report different DIFOT, performance is rarely the reason. These are, and each one is worth several points.
- Which date is on time. The date the customer asked for, or the date you confirmed back to them. Using the confirmed date flatters the number and hides the orders you could not accept as requested.
- What a short line does. Fails the whole order, or counts as a partial that passes. This is the single biggest swing of the four.
- What gets excluded. Cancellations, customer reschedules, credit holds. Every exclusion is defensible on its own and the pile of them is where a number goes quietly soft.
- When the clock stops. Despatch scan, carrier pickup, proof of delivery. Measuring at despatch makes it your warehouse's number. Measuring at delivery makes it the customer's.
None of these is the wrong answer. Picking one and holding it is what matters, because a DIFOT trend is only worth reading if the definition underneath it stayed still.
Measure these beside it
- On time and in full, separately. The gap between them tells you whether you have a delivery problem or a stock problem. A 98 per cent fill rate against a 91 per cent DIFOT is a transport conversation.
- A reason code on every failure. A DIFOT number with no causes attached says you have a problem and nothing about which one.
- The cost of a failure. Rework, redelivery, credits, penalties. It is what turns a percentage into a case for doing something.
DIFOT review and improvement The DIFOT and KPI toolkit
Questions about DIFOT and OTIF
What does DIFOT stand for?
Delivered In Full, On Time. One order, measured against two tests, and it only counts if it passes both. Partial delivery on the right day fails. Complete delivery a day late fails.
What is the DIFOT formula?
Orders delivered in full and on time, divided by total orders delivered, times one hundred. The arithmetic is the easy part. Every argument about DIFOT is really an argument about the definitions underneath it.
Are DIFOT and OTIF the same thing?
Same measure, different word order, and which one a business uses mostly depends on where its supply chain people trained. DIFOT is the common term in Australia and New Zealand. OTIF is more common in the United States and Europe. If someone tells you they run both and the numbers differ, the definitions differ, not the performance.
What is a good DIFOT percentage?
There is no official standard, and anyone quoting one without asking how you measure it is guessing. As a rough guide to what gets said in Australian operations: under 90 per cent is a problem customers have already noticed, the low to mid 90s is common and usually improvable, 95 to 98 is a well run operation, and above 98 is either excellent or the measure has been made easy. Grocery and large retail supply agreements often mandate the high 90s with penalties attached. The useful question is not what is good, it is whether your number means the same thing it meant last quarter.
How is fill rate different from OTIF?
Fill rate only asks whether the quantity was complete. OTIF asks that and whether it arrived on time. A business can run a 98 per cent fill rate and a 91 per cent DIFOT, and the gap between those two numbers is a delivery problem rather than a stock problem. Looking at one without the other hides which half is broken.
Why do two systems give different DIFOT numbers?
Because at least one of these is defined differently in each: whether on time means the customer's requested date or the date you confirmed, whether a line short counts as a failed order or a partial, whether cancelled and rescheduled orders are excluded, and when the clock stops. Those four choices move a DIFOT number by several points without anything changing on the dock.
What should I measure alongside it?
On time and in full separately, so you know which half is costing you. Then the reason code on every failure, because a DIFOT number with no causes attached tells you that you have a problem and nothing about which one.
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