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Measures the performance of a system

Service level measures the performance of a system. Certain goals are defined and the service level gives the percentage to which those goals should be achieved. Fill rate is different from service level. Examples of service level:
Percentage of calls answered in a call center. Percentage of customers waiting less than a given fixed time. Percentage of customers that do not experience a stockout. Percentage of all parts of an order being fulfilled completely
(Explanation) if one component part of an order is not filled the Service Level for that order is Zero, If all the component parts of an order are delivered except one is filled at 51%, the service level for that order is 51% (This system is often used in supply chain delivery to manufacturing), This is a very different from a simple order fill measurement which does not consider line items on the order.

Service level is used in supply chain management and in inventory management to measure the performance of inventory replenishment policies. Under consideration, from the optimal solution of such a model also the optimal size of back orders can be derived. Unfortunately, this optimization approach requires that the planner knows the optimal value of the back order costs. As these costs are difficult to quantify in practice, the logistical performance of an inventory node in a supply network is measured with the help of technical performance measures. The target values of these measures are set by the decision maker. Several definitions of service levels are used in the literature as well as in practice. These may differ not only with respect to their scope and to the number of considered products but also with respect to the time interval they are related to. These performance measures are the key performance indicators (KPI) of an inventory node which must be regularly monitored. If the controlling of the performance of an inventory node is neglected, the decision maker will not be able to optimize the processes within a supply chain.

The γ service level, a time and quantity related performance criterion, serves to reflect not only the amount of backorders but also the waiting times of the demands backordered. The γ service level is defined as follows:

The γ service level is rarely used in industrial practice.

In business, service rate is a performance metric used to measure the customer service in a supply organization. One example of a service rate measures the number of units filled as a percentage of the total ordered and is known as fill rate. If customer orders total 1000 units, and you can only meet 900 units of that order, your fill rate is 90%. In statistics, notably in queuing theory, service rate denotes the rate at which customers are being served in a system. It is the reciprocal of the service time. For example, a supermarket cash desk with an average service time of 30 seconds per customer would have an average service rate of 2 per minute. In statistics the Greek letter is used for the service rate.