8
8
SUPPLY CHAINS TO ADMIRE | 2023
There are many barriers to beating the peer group in improvement, performance, and value. Smaller, innovative, newer companies focusing on customer value tend to win the Supply Chains to Admire award. Examples of smaller innovative companies winning the award include Monster Beverages and Intuitive Surgical. The retail winners drove excellence through business model innovation. Companies following traditional supply chain practices focused
on transactional efficiency do not make the cut to place in the Winner's Circle. Using functional metrics and close coupling of the supply chain to the budget is a barrier to improving balance sheet improvement. (In contrast, the budget is input but not a constraint for winners.) A worst-case scenario is defining the supply chain as another function within a rigid set of silos. The definition of the supply chain function is more problematic in Europe than in the Americas.
Operating Margin vs. Inventory Turns (2013 - 2022) Figure 2. Orbit Chart: Ecolab Progress Against Peer Group
Best Scenario
7.00
2019
6.50
ECL 0.14, 5.35
6.00
2016
2014
2017
2013 2016
2020
2013
5.50
Chemical 0.11 4.92
2014
2021
5.00
2015
2015
2017
2020
2022
2019
2018
2022
4.50
2018
2021
4.00
0.07
0.08
0.09
0.10
0.11
0.12
0.13
0.14
0.15
0.16
0.17
Operating Margin
Fundamental Average Scores Ecolab = 9 Industry = 8
Ecolab
Chemical Industry
◆ Average (Operating Margin, Inventory Turns) Source: Supply Chain Insights LLC, Corporate Annual Reports 2013-2022 from YCharts
Supply Chain Insights LLC Copyright © 2023, p. 2 Source: Supply Chain Insights LLC, Corporate Annual Reports 2013-2022 from YCharts
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