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HowWell Do You KnowYour Supply Chain?A Survey Report
ByArvind MehtaPresident & CEO, Touchstone ITS
September, 2015
Touchstone ITS | 777 Main Street | Suite #600 | Fort worth | Texas 76102Phone: (817) 886.0998 | Email: info@touchstone-its.com | Web: www.touchstone-its.com
ANote To The Readers:
In a rapidly growing globalized market when more and more companies are
trying to expand their business across the borders, increasing pressure of
demanding customers, growing cost of raw material, manufacturing, logistics,
labor and need to adopt ever-advancing disruptive technologies are putting
tremendous pressure on the companies to reinvent their supply chain processes
and change the way they look at their value chain.
As they rightly say- “If you can’t see it, you can’t measure it and if you can’t
measure it, you can’t control it.” In order to achieve substantial cost reductions
in various supply chain areas, executives in some of the successful companies
have not only understood the importance of analytics but they have also
leveraged the technology to deploy analytics in different supply chain
processes and that has definitely played a transformational role in the evolution
of the modern form of supply chain.
This report is a summarized result of the survey we conducted in June 2015.
The survey was sent to 487 supply chain professionals working with the
companies like Fossil, 3M, CISCO, Conagra Foods, Colgate Palmolive, Bio
Rad, SABMiller etc. 206 people responded to the survey. The purpose of this
survey was to gain insight into some of the common supply chain challenges
being faced by the companies across various industries, their priorities in
regards to various supply chain areas and the tools they are using to manage
their supply chains. This report also reveals how their supply chain team
members rate the different characteristics of their supply chains.
The survey consisted of following ten questions:
1. In your opinion, where does supply chain exist in the priority list
of your top organizational leadership?
2. Do you think your company is putting enough focus on supply
chain?
3. How do you think your supply chain ROI yield is meeting your
expectations?
4. Does your company has any formal S&OP / Demand forecasting
process in place?
5. Does your company has continuous process improvement
program in place?
6. Does your company has any skill-development program for your
supply chain employees?
7. Does your company has any Voice of Customer (VoC) program
in place?
8. How would you rank the following areas of your supply chain
on your priority list - S&OP, Inventory Management,
Purchasing, Supplier Capabilities, Manufacturing,
Warehousing, Logistics, Customer Service?
9. Which of these applications your does your company use: ERP,
CRM, SCM, SRM, Business Intelligence & Analytics, None?
Ten Questions:
10. How would you rate the following characteristics of your
supply chain on the scale of 1 to 5, 1 being the lowest and
5 being the highest rating- Agility, Visibility, Responsiveness,
Complexity, Sustainability, Security, Efficiency, Internal
Collaboration, External Collaboration, Automation, Cost,
Management Risk Management and Resilience.
Q1. In your opinion, where does supply chain exist in the
priority list of your top organizational leadership?
55% Respondents considered their supply chain as “very
important” in the priority list of their top organizational
leadership
30% Respondents thought it is important
15% Respondents thought it is not so important
The Analytics:
Q2. Do you think your company is putting enough focus on
supply chain?
55% Respondents thought their companies are putting enough
focus on supply chain
20% Respondents responded their companies are not putting
enough focus on supply chain
25% Respondents thought their companies are not putting any
focus whatsoever on the supply chain
Q3. How do you think your supply chain ROI yield is meeting
your expectations?
5% Respondents responded their supply chain is exceeding
their expectations in terms of ROI yield
60% Respondents responded their supply chain performance
is meeting their expectations
35% Respondents responded their supply chain was under
performing in terms of ROI yield
Q4. Does your company has any formal S&OP / Demand
forecasting process in place?
75% Respondents responded their companies have a formal
S&OP/ Demand forecasting process in place
20% Respondents responded their companies do not have
formal S&OP/ Demand planning process
5% Respondents responded their companies do not have any
S&OP/ Demand forecasting in place
Q5. Does your company has continuous process improvement
program in place?
75% Respondents responded their companies do have
continuous process improvement program in place
25% Respondents responded their companies do not have any
continuous process improvement program in place
Q6. Does your company has any skill-development program
for your supply chain employees?
60% Respondents responded their companies have skills
development programs for their supply chain employees
40% Respondents responded their companies do not have any
skills development programs for their supply chain employees
in place
Q7. Does your company has any Voice of Customer (VoC)
program in place?
55% Respondents responded their companies do have Voice
of Customer (VoC) program in place
44% Respondents responded their companies do not have any
Voice of Customer (VoC) program in place
Q8. How would you rank the following 8 areas of your supply
chain on your priority list - S&OP, Inventory
Management, Purchasing, Supplier Capabilities,
Manufacturing, Warehousing, Logistics, Customer
Service?
We used the weighted average method to rank the responses to
this question:
Customer service topped the list with weighted average score
of 6.00.
S&OP ranked second with weighted average score of 5.20
Inventory Management ranked third with weighted average
score of 5.15.
Manufacturing ranked fourth with weighted average score of
4.50
Purchasing ranked fifth with weighted average score of 4.25
Logistics ranked sixth with weighted average score of 3.95
Supplier Capability & Performance ranked seventh with
weighted average score of 3.50
Warehousing remained at the bottom of the list with weighted
average score of 3.45
45% Respondents considered Customer Service as their top
priority
30% Respondents considered S&OP as their top priority
10% Respondents considered Inventory Management as their
top priority
10% Respondents considered Manufacturing as their top
priority
5% Respondents considered Warehousing as their top priority
None of the respondents considered Purchasing, Logistics,
Supplier Capabilities & Performance as their top priority
Q9. Which of these applications your does your company use:
ERP, CRM, SCM, SRM, Business Intelligence &
Analytics, None?
85% Respondents reported their companies using ERP
50% Respondents reported their companies using CRM
60% Respondents reported their companies using SCM
30% Respondents reported their companies using SRM
50% Respondents reported their companies using BI &
Analytics
5% Respondents reported that their companies were not using
any of the above applications
Another interesting fact that we discovered while analyzing the
combinations of applications being used by various companies
through these responses are:
85% of these companies are using some kind of ERP
application
20% of these companies are using all five applications
20% of these companies are using only ERP application
15% of these companies are using ERP, CRM and SCM
applications
50% of these companies are using some kind of Business
Intelligence &Analytics applications
5% of these companies are using ERP, CRM, SCM and SRM
applications but no BI &Analytics
5% of these companies are using none of these applications
Q10. How would you rate the following characteristics of your
supply chain on the scale of 1 to 5, 1 being the lowest and
5 being the highest rating- Agility, Visibility,
Responsiveness, Complexity, Sustainability, Security,
Efficiency, Internal Collaboration, External
Collaboration, Automation, Cost, Management Risk
Management and Resilience?
We used the weighted average method to rank the responses to
this question:
Supply chain complexity topped the list scoring 3.65
weighted average
Supply chain cost management ranked second with a
weighted average score of 3.50
Supply chain visibility ranked third with a weighted average
score of 3.25
Supply chain responsiveness scored a weighted average of
3.20 and ranked fourth
Supply chain agility ranked fifth with a weighted average
score of 3.15
Supply chain internal collaboration also scored a weighted
average of 3.15 but we put it on the sixth rank, ranking it
lower than supply chain agility on the basis of the fact that
15% respondents put supply chain agility on the top of their
list Vs. 10% who put internal collaboration
Supply chain security, risk management and resilience all
scored a weighted average of 3.10 but ranked seventh, eighth
and ninth
Supply chain sustainability, efficiency and external
collaboration all scored a weighted average of 3.05 and
ranked tenth, eleventh and twelfth
Supply chain automation scored a weighted average of 2.95
and was placed at the bottom of the list
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