From 63.5% to 86.8%: what OTIF is and how to really improve it
What OTIF measures, why it is so demanding, and the three changes that took Mattel’s Latin America OTIF from 63.5% to 86.8%.
By One metric tells a customer, bluntly, whether they can trust you: OTIF. In Mattel’s Latin America supply chain, ours was at 63.5% at one point. Almost four in ten orders failed at something. We took it to 86.8%. Here is what I learned.
What OTIF is
On Time In Full: the share of orders that arrive on the committed date and complete. Both at once. An order that arrives on time but short fails. One that is complete but a day late fails too.
That is why OTIF is always lower than on-time performance, and why it matters so much: it is the closest thing to what the customer experiences when the truck arrives or the box is opened.
Why a low OTIF is nobody’s fault alone
When the number is bad, the temptation is to find a culprit: the supplier who didn’t ship, the carrier who was late, the warehouse that loaded short. Almost always it is a coordination problem. Each party optimizes its piece and nobody optimizes the whole order.
The three changes that moved the number
1. Redesign fulfillment planning with everyone at the table. We planned together with suppliers, carriers and distribution centers instead of handing each one its piece separately. When everyone sees the same customer commitment, dates stop being a sales promise made in isolation.
2. Allocate freight by performance. Carriers began receiving volume based on their performance, not habit. The message was clear: volume is earned with service.
3. Run a control tower. A dedicated team planning loads and transit times, and tracking orders before they failed. The difference between reacting and anticipating is the difference between explaining a delay and avoiding it.
What I would apply in any operation today
- Define OTIF once (what “on time” and “in full” mean) and don’t change it to look better.
- Separate root causes: supplier, transport, warehouse, planning. No causes, no plan.
- Review the trend weekly with the owners of each cause in the same conversation.
- Reward performance when allocating volume.
OTIF doesn’t improve with a new dashboard. It improves when everyone who touches the order answers for the whole order.
Key takeaways
- OTIF only counts an order as good if it arrives on time and complete, so it is always lower than on-time performance.
- A low OTIF is rarely one party’s fault: it is a coordination problem between suppliers, carriers and distribution centers.
- Allocating freight by performance, not habit, changes carrier behavior.
- A control tower turns delays into early alerts instead of after-the-fact explanations.
FAQ
What does OTIF stand for?
On Time In Full: the share of orders delivered on the committed date and in the full quantity. If the date slips or a unit is missing, the order doesn’t count.
How is OTIF different from on-time delivery?
On-time delivery only measures the date. OTIF also requires the order to be complete, which makes it stricter and closer to what the customer experiences.
What is a good OTIF?
It depends on the industry and on how the delivery window is defined. What matters is measuring it consistently, separating root causes and watching the trend, not just this month’s number.
This article is for information only and reflects my personal view; it is not legal, tax or customs advice.
VP of Global 99 at 99minutos. 13+ years in international trade, freight and cross-border across Asia, Latin America and the United States.