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The award, based on beating the industry peer group on rate of improvement on the key metrics of growth, operating margin, inventory turns, and Return on Invested Capital (ROIC) while outperforming their peer group, is tough to achieve. The orbit chart below illustrates L’Oréal’s performance at the intersection of two metrics.
CaseStudies. A CaseStudy. This casestudy will show you the analysis of Apple Supply Chain core processes, challenging issues and complexities of its operations. Information about Apple Supply Chain is a bit here, there and everywhere, its kinda tough to find the actual casestudy.
This uncertainty makes dynamic inventory replenishment optimization essential for business success. Effective inventory optimization directly impacts customer satisfaction, loyalty, operational costs, and waste reduction making it a critical business function in todays volatile market.
Analysis of casestudy is certainly one of the most popular methods for people from business management background. In order to accelerate the learning, this article has gathered 20+ most sought-after supply chain casestudies, analyzed/categorized them by industry and the findings are presented.
We have found that supply chain metrics are gnarly and complicated.During We believe that a supply chain leader is defined by both the level of performance on the Effective Frontier (balance of growth, Return on Invested Capital, Profitability and Inventory Turns) and driving supply chain improvement.
I also think that Quintiq’s leadership in concurrent planning to solve new problems is promising, especially in the design of transportation and inventory flows. Service level is our most important metric. Reliability in both of these metrics is critical. Interview of a Supply Chain Leader: Redesigning for Value.
We talk about the move from functional metrics to a balanced scorecard, but we don’t use a balanced scorecard as an objective function. Orbit charts of four companies for the period of 2013-2022 at the intersection of operating margin and inventory turns. We talk about complexity, but do not measure the impact on forecastability.
How aligned do you believe your organization is to drive these metrics? P&G did not appreciate the work Gilette accomplished on form and function of inventory and using market signals. As a result, the company’s performance at the intersection of margin and inventory turns was circular for the past decade.
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.) A CaseStudy. A potential value of a digital twin.).
Over the last six years, we studied the connection between business results (growth, operating margin, inventory turns and Return on Invested Capital (ROIC)) and the link to company characteristics. Reward teams for cross-functional metrics. Focus functional metrics to improving reliability. What did we find?
For the past five years, the team at Supply Chain Insights identified Supply Chains to Admire Award Winners by analyzing performance by peer group on the key metrics of growth, operating margin, inventory turns and Return on Invested Capital (ROIC). In 2018, Rockwell Automation won the Supply Chains to Admire Award. Meet Ernest.
Tom, the colorful warehouse manager, constantly heckled Frank for the increasing inventory levels while Ed, the quiet material/logistics manager, constantly questioned if there was a better way. He felt that inventory was no problem, he would just cut it at the end of each quarter to make the balance sheet goals. The So What?
It is a quest and the subject of my next book, Metrics That Matter , that will publish in September, 2014. We have found that nine out of ten organizations are stuck on their ability to make improvements on both operating margin and inventory turns in the same year. The chapters will be rich with casestudies.
The future inventory fire sale. We are living in a world of rich supply chain casestudies. One of my stark realizations this year is that smaller companies are beating larger and often more established companies on growth metrics, inventory turns, operating margin, and Return on Invested Capital (ROIC). (In
History will also include casestudies of mergers and acquisitions. It is not as simple as trading-off inventory, cost, and customer service. We selected these metrics based on correlation work with Arizona State University in 2012. The companies I work with struggle to set metrics targets. Celebrating Success.
We speak about the need to move from a functional understanding to a global, holistic capabilities, but the traditional supply chain leader defines bonus incentives and process performance goals based on functional metrics. Measurement. Organizations speak of the bullwhip, but don’t measure it or monitor the effects. I think clearer.
In a recent study, our goal was to understand the impact of process and technology choices on balance sheet performance. We analyzed the impact of 150 factors on 493 financial metrics for the period of 2004-2016. This included responses to 3604 questions by 1063 individual respondents in 40 studies representing 756 unique companies.
Interview with Lora Cecere, Founder and CEO of Supply Chain Insights and Author of Supply Chain Metrics that Matter ( published December 2014 ). Metrics that Matter became a three year research project. I realized that many organizations are very confused about metrics. So I started this book as a summary of this research.
The focus is on functional metrics, but are unable to get to overall supply chain metrics. For example, only 29% of manufacturing companies can access total cost data and 31% struggle to see the impact of business decisions on inventory. Figure 4 is a casestudy from Lenovo. Example of Social Sentiment Analysis.
This casestudy from Schneider Electric will highlight a framework and the key success factors for implementing visibility and collaboration solutions to gain benefits not just for your organization but for your entire ecosystem of partners. Benji Green, director of global sales, operations and inventory planning, Avaya.
Completed in 2012, the ERP project forced the company to standardize organizational design, roles, and metrics. They saw a steady drop in inventory and reduced working capital by about 50% over the period of 2011-2015. Impact of Demand Sensing on Inventory Levels. The reason? The implementation was very successful.
If the arrow is red, the industry is moving backwards on a metric. The industry made progress on revenue/employee, but struggled on growth, margin, inventory turns. Some of the strongest casestudies of supply chain leadership are in this value chain. Companies, based on culture, tend to focus on singular metrics.
For instance, a student struggling with inventory management concepts can receive supplementary materials, interactive simulations, and one-on-one tutoring sessions tailored to their needs. Conversely, a student who quickly grasps procurement strategies can be challenged with advanced casestudies and leadership projects.
For this casestudy we interviewed Ralf Busche, Senior Vice President of Global Supply Chain Strategy and Performance. Our goal in writing these casestudies is to share insights from the Supply Chains to Admire winners from 2016. Inventory Turns. Here we share the interview with Ralf. Operating Margin.
When we study 600 public companies by peer group, at the intersection of inventory turns and operating margin, only 5% drive improvement. An orbit chart is a plotting of data at the intersection of two metrics. In this case, the metrics are operating margin and inventory turns. Question the Basics.
Among the many supply chain initiatives taking place today, vendor-managed inventory (VMI) has become an increasingly effective process and business model to help organizations share risk and information between vendors and customers — while benefitting from lower stockouts, reduced uncertainty and lower costs. Lower order volatility.
The focus is on channel data: price; inventory positions; and policies. It is about much, much more than Vendor Managed Inventory (VMI ) or Collaborative Forecasting and Replenishment. An example of social listening is the Lenovo CaseStudy presented at the 2015 Supply Chain Insights Global Summit. Market Drivers.
Despite two decades of advancement in supply chain technologies, companies are struggling to gain balance at the intersection of operating margin, inventory turns and case fulfillment. Along the way, I will be doing more work on network design casestudies. Today, nine out of ten supply chains are stuck.
Year after year, well intentioned people toiled against improving metrics that reduced, not improved, the effectiveness of the supply chain. ERP is valuable to improve transactional accuracy, but I can find no evidence that investments in ERP have reduced inventory or improved cash-to-cash cycles. Metrics comparison of Kellogg Co.
When it comes to the management of inventory in value chains, frustration abounds. Executive, after executive, lament, “They have purchased many technologies and sponsored many projects to reduce inventories, but they are not seeing results.” Inventory is the culmination of many business decisions. Tracking Progress.
As a result, companies are writing new casestudies through their actions or inaction. We find that three factors mattered: organizational alignment, descriptive analytics, and inventory management. Companies driven by functional metrics struggled: they could not adapt quickly to the higher transportation costs.).
Supply chains have been optimized; warehouse inventory tracking has reached new levels of precision; production lines can operate with virtually no downtime. As the common linchpin that brings together all manufacturing activities, has this metric improved along with all the investment in new technologies? Validation by CaseStudy.
Inventory and warehouse performance are powerful, often underappreciated, tools for boosting customer satisfaction and increasing profitability. Effective inventory and warehouse management directly impact a business’s ability to meet customer expectations by ensuring timely deliveries, accurate order fulfillment, and reduced errors.
Instead, in the SanDisk journey , they adjusted the speed of response to their customer segments, and actively designing inventory postponement strategies. This included monthly reviews between business units and central operations teams and adaptive inventory segmentation policies. In fact, the teams ignore the forecast. Does it work?
The larger the organization, the more tension with conflicting functional metrics making decisions more difficult. Inventories increased by 44% due to supply chain volatility. Inventories grew year-over-year by 43%. Coming off a period of high growth, companies are struggling with margins and inventory. See the pattern?
If you (or your boss) are measured by your company's Return on Invested Capital (ROIC) or a similar metric, then you want to turn assets into cash. Inventory optimization is one proven way to do it. Inventory is an untapped, cash-rich asset. Inventory is an untapped, cash-rich asset. Of course, you need inventory.
The next posts in the series will break down metrics and issues to consider in SQM by industry and conclude with a casestudy on the application of SQM. 5 Key Metrics to Use for Scoring Supplier Quality Management (From LNS Research ). The definition of this metric is similar to the way it sounds. Cost of quality.
CaseStudy Agility: ZARA. CaseStudy Resilience: CISCO. CaseStudy Risk management: The All England Club. Build inventory hedge to cover for volatility and risk (from Just in time to Just in Case) : Understand demand and supply side shocks, volatility and develop Inventory hedging strategies.
I think about this discussion with Keith often as I work on the Supply Chain Index and edit the chapters of Metrics That Matter. In Figure 1, I share a composite orbit chart of progress of Cisco Systems, Intel, Samsung and Flextronics on the Effective Frontier at the intersection of inventory turns and operating margin for 2006-2012.
Daily, we see business continuity casestudies as headline news in the Wall Street Journal. Growth agendas with the spiraling demand require cash, supplier shortages necessitate the shortening of payables, and the longer/more variable transport lead times decrease inventory turns increasing the need for cash. The answer?
Granular data by volume is a must to be able to manage replenishment, network design, and inventory targets. The data in Table 1 is from a recent research study. A simplistic view is that supply chain excellence is the trade-off of cost, inventory and customer service. Most budgets are completed in currency at a brand level.
Metrics Definition. The organization needs to be clear on the Metrics That Matter and the alignment of vertical silos’ metrics to the balanced portfolio. Forecasting hierarchies need to roll up to define business requirements, and inventory needs to be reported by form and function. Form and Function of Inventory.
In Figure 1, we show the aggregate trend of the chemical industry in an orbit chart format showing year-over-year results at the intersection of two metrics operating margin and inventory turns. inventory turns. for inventory turns define best-in-class performance? for inventory turns define best-in-class performance?
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