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At each company, there is a relationship between the metrics of growth, margin, inventory, customer service, and asset strategy. For the purpose of this article, I will use Return on Invested Capital (ROIC) as the proxy metric to discuss asset utilization.) I never calculated and accounted for the inter-dependencies between metrics.
While the performance rankings were based on comparisons of inventory turns, operating margin and Return on Invested Capital (ROIC) for the periods of 2006-2013 and 2009-2013, the concept is that to be a supply chain leader you must outperform and drive improvement. Aligned Metrics. We find that this is true of too few companies.
In August 2020 Gartner published this report “4 Tactics Procurement Can Use to Sustain Influence as Economic Conditions Improve” This blog summarizes the key points of the report which you can read in full, here. Procurement Teams Step-up. A Blueprint for Demonstrating the value of Strategic Procurement.
We are trying to understand how supply chain leaders have raised the bar at the intersection of these four sets of metrics on the supply chain effective frontier. I also believe that it is because the organization is not incented to manage cash-to-cash metrics. The results have been eye-opening. But, it does not stop there.
We have found that supply chain metrics are gnarly and complicated.During In our program, cost avoidance, while desirable, does not count towards the metric. We would not have succeeded without a team effort across R&D, the business leaders, and SC disciplines of engineering, procurement, and manufacturing.
A CPO in the financial services industry also noted that a need to redefine procurement’s role in the enterprise is happening, driven by the recognition that a new type of procurement capability is needed: Prior to our transformation, the ONLY metric by which our performance was measured is how much money we saved for the organization.
As some component lead times push into 2023, the shortage is expected to last 24 months before it recedes – similar to the chip shortage of 2008-2009. Within a week of Russian troops crossing into Ukraine, the benchmark for thermal coal prices reached a record high of $446 per metric ton. Deloitte Global). AlixPartners). Deloitte ).
A common challenge for procurement and supply chain professionals is obtaining support from C-level leaders to invest in a robust supply chain risk management (SCRM) program. But to make their strongest case, SCRM advocates need to focus on one key metric: return on investment. ROI analysis: core to a strong business case.
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. Insuring that each function, including online marketing, store operations and supply chain have common objectives, metrics and aligned rewards for the coming year. Procurement Blog. Business Process Outsourcing.
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. Example: For a shipper, number of shipments at a 3PL warehouse might be a relevant metric while the 3PL provider may be more interested in the number of shipments for all serviced shippers. Procurement Blog.
Stuart William was in one of my former MBA classes at NC State in 2008, and graduated into one of the worst economies ever in May of 2009. In 2009 it lost two-thirds of their sales – and lost money for four years in a row. Upon graduation, there simply weren’t any jobs available at all!
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. Consistent Business Intelligence - BI metrics can be obtained consistently across the entire business banking on the foundation of single version of master data. Procurement Blog. December 2009.
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. IT enablement in areas like Mobile work management, Health and Safety, Metrics monitoring (KPI) etc. Procurement Blog. Sourcing,Procurement,Contract & Spend Management (38). December 2009.
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. In this step, the actuals are compared with the planned metrics (MAPE, forecast accuracy, bias etc.) Procurement Blog. Business Process Outsourcing. Customer Service. Finance & Accounting. Human Resources.
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. Some of those are Cognos, iLog, SPSS, Core Metrics, Emptoris, Vivisimo and many others, as world is moving from reactive to proactive. Procurement Blog. Sourcing,Procurement,Contract & Spend Management (38).
Sourcing & Procurement. Sourcing & Procurement. ProcureEdge – Sourcing & Procurement. A further benefit of integration of these many systems is to allow organizations to effectively report on their sustainability metrics. Procurement Blog. Sourcing,Procurement,Contract & Spend Management (38).
Handfield and Universidade Federal do Espirito Santo’s Dr. Marcos Paulo Valadares de Oliveira showed that an open analytics culture (OAC) strongly correlates with improved supply chain performance metrics. Supply Chain Metrics!?!? Vanity metrics and dashboards excite viewers but. What is an “Open Analytics Culture” (OAC)?
When Gartner purchased AMR Research in December 2009, the methodology became the Gartner Supply Chain Top 25. Total cost analysis is more difficult than it sounds and most technology implementations automated functional measurement systems (manufacturing or procurement), but leave the organization blind on the management of total costs.
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