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SUPPLY CHAINS TO ADMIRE | 2025
‣ For Top Performers, the Budget is Never Tightly Integrated to the Operating Plan. The close coupling of the supply chain to the budget is a barrier to improving the balance sheet. (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 supply chain finance is more problematic in Europe than in the Americas. ‣ Alignment with R&D Innovation is Key to Results. 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 Intuitive Surgical, Paccar, and TSMC. The retail winners drove excellence through business model innovation.
A characteristic of a true supply chain leader is the ability to drive higher performance levels within a peer group and sustain this competitive advantage over time. Amazon and Alibaba, the giant e-commerce providers, are conspicuously absent from the list. While we recognize them as supply chain leaders, the Supply Chains to Admire methodology requires a peer group comparison. This is just not possible within this industry: there are too few companies to drive a good peer group for comparison, thus eliminating their inclusion in the analysis.
Table 4. Shifts in Functional Metric Definition
Shifts in Functional Metric Definition
Conventional Thinking
Shifts to Optimize Market Potential
Forecasting
Error and Bias
Forecast Value Added and Bias
Inventory Management
Safety Stock
Targets for Form & Function of Inventory Inventory Value Added
Manufacturing
Operational Equipment Efficiency (OEE)
Schedule Adherence First-Pass Yield
Transportation
Transportation Costs
On-time Delivery Reliability in First-Pass Tender Reliability and Quality of Supply Minimal Bullwhip
Procurement
Purchase Price Variance
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