The supply chain is a vital part of every manufacturing and distribution company, and can represent as much as 70 percent of a company’s operational costs. Yet many small and medium-size businesses (SMBs) often struggle to build and sustain the supply chain capabilities necessary to compete effectively and grow. Recent research by Supply Chain Edge sheds light on the state of SMBs’ supply chain capabilities and identifies areas in which companies are excelling and struggling. Read our full research report, or our summary presentation, to learn more about our research findings. http://www.supplychainedge.com/insights/building-a-better-supply-chain/

1. Building a Better Supply Chain
Exploring the Results of SCE’s SMB Survey
December 2013
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
1

2. Building a Better Supply Chain
Introduction
– The supply chain is a vital part of every manufacturing and distribution
company.
– Having robust supply chain capabilities is vital to operating on a global
scale and effectively managing the complexities that come with
sourcing and selling around the world.
– Research by Supply Chain Edge sheds light on the state of SMBs’
supply chain capabilities and identifies areas in which companies are
excelling and struggling.
– Nearly 80 executives from small and midsize companies participated in
an online survey July‐October
© 2013-2014 Supply Chain Edge LLC. All rights reserved.

3. Building a Better Supply Chain
Respondents
Company Size and Industry
Aerospace/Defense
Less than $50 million
5%
$50 million‐$100
18%
million
29%
4%
Automotive
30%
Consumer Products
$101 million‐$200
million
18%
27%
Industrial Products
$201 million‐$500
million
8%
$500 million‐$1
12%
billion
15%
More than $1 billion
Technology
10%
4%
Health/Beauty Care
20%
Other
© 2013-2014 Supply Chain Edge LLC. All rights reserved.

4. Building a Better Supply Chain
Respondents
Respondent Titles
14%
President/CEO
18%
Vice president/director
of supply chain
Vice president/director
of operations
62%
6%
Other
© 2013-2014 Supply Chain Edge LLC. All rights reserved.

5. Building a Better Supply Chain
Respondents
A Global Focus
Participants Sourcing From:
Participants Selling To:
North America
100%
Asia
20%
9%
Africa
19%
0%
23%
Australia/Oceania
40%
Africa
24%
Central America
43%
Australia/Oceania
30%
South America
48%
Eastern Europe
48%
Eastern Europe
52%
South America
77%
Western Europe
55%
Central America
95%
Asia
61%
Western Europe
North America
40%
60%
80%
100%
120%
6%
0%
20%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
40%
60%
80%
100%

6. Building a Better Supply Chain
Respondents
Key Challenges to Growth
Bring products to market quickly/cost‐effectively
Maintain high customer service/responsiveness
Reduce/control operational costs
Find growth in new markets
Streamline business processes/operations
Find the right people
Keep pace with technological changes
Address regulations/government constraints
Overcome stronger competitors
Identify risks and impacts
Develop relevant/effective business strategies
36%
30%
25%
22%
21%
15%
13%
12%
10%
9%
9%
0%
5%
10%
15%
20%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
25%
30%
35%
40%

7. Building a Better Supply Chain
Supply Chain Success Factors
Supply chain strategy aligned with company strategy
5.08
Supply chain supports company mission
4.97
Customer responsiveness at acceptable cost to serve
4.89
Senior leaders know impact on ROIC, ROA, cash‐to‐cash
4.68
Board knows value of supply chain
4.61
Metrics to evaluate impact on financial performance
4.44
Technologies to make fact‐based business decisions
4.29
Data to give accurate view of supply chain health
4.26
Comprehensive, current risk management plan
4.08
Processes to recruit and develop skills
3.94
Advanced demand forecasting capabilities
3.59
0
1
2
3
4
5
*Average rating of respondents’ agreement with each statement, using a 1-7 scale with 1=strongly disagree and 7=strongly agree.
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
6

8. 8
Building a Better Supply Chain
Supply Chain Success Factors
Ensure tight alignment between the supply chain and company mission and strategy
Our supply chain function supports our
company’s mission:
Our supply chain strategy is tightly aligned with
our overall company strategy:
6%
7 ‐ extremely well
24%
6
27%
4
25%
6
38%
5
28%
5
27%
4
2%
3
14%
7 ‐ strongly agree
0%
3
2
0%
2
1 ‐ not well at all
0%
1 ‐ strongly disagree
0%
10%
20%
30%
40%
6%
0%
0%
5%
10%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
15%
20%
25%
30%

9. Building a Better Supply Chain
Supply Chain Success Factors
Enhance responsiveness to customers while maintaining acceptable cost to serve
Our supply chain enables us to be highly responsive to customer needs while maintaining
an acceptable cost to serve.
12%
7 ‐ strongly agree
17%
6
36%
5
20%
4
9%
3
5%
2
0%
1 ‐ strongly disagree
0%
5%
10%
15%
20%
25%
30%
35%
40%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
9

10. Building a Better Supply Chain
Supply Chain Success Factors
Enhance responsiveness to customers while maintaining acceptable cost to serve
How well our company manages its inventory and physical assets, and continually improves
order cycle time.
120.0%
100.0%
18.0%
7.0%
80.0%
44.0%
60.0%
Excellent
Good
52.0%
Fair
40.0%
Poor
20.0%
49.0%
29.0%
0.0%
Manage its inventory and physical
assets?
Continually improve order cycle time?
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
10

11. 11
Building a Better Supply Chain
Supply Chain Success Factors
Ensure board and senior executives understand supply chain’s contribution
Our company’s board members have a good
understanding of the importance and
contributions of our company’s supply chain
operations:
10%
7 ‐ strongly agree
27%
21%
5
10%
14%
6%
2
5%
5%
21%
3
8%
0%
27%
4
13%
1 ‐ strongly disagree
17%
6
5
16%
4
2
13%
7 ‐ strongly agree
6
3
Our senior leadership team has a good
understanding of the supply chain’s impact on
ROIC, ROA and cash-to-cash cycle time:
2%
1 ‐ strongly disagree
15%
20%
25%
30%
0%
5%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
10% 15% 20% 25% 30%

12. Building a Better Supply Chain
Supply Chain Success Factors
Use metrics to evaluate supply chain impact on enterprise financial performance
We have and regularly use a set of metrics to
comprehensively evaluate the supply chain’s
impact on the company’s overall financial
performance.
6%
7 ‐ strongly agree
26%
5
11%
2%
1 ‐ strongly disagree
2%
5%
23%
2
11%
0%
18%
3
13%
1 ‐ strongly disagree
24%
5
4
23%
4
16%
6
19%
2
6%
7 ‐ strongly agree
6
3
We generate and collect the full range of
operational and financial data to give us an
accurate view of the health of our supply
chain operation.
10%
15%
20%
25%
30%
0%
5%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
10%
15%
20%
25%

13. Building a Better Supply Chain
Supply Chain Success Factors
Deploy technologies that enable you to make more accurate, fact‐based decisions
We have the necessary technologies and tools in place for making solid, fact-based business
decisions.
6%
7 ‐ strongly agree
14%
6
24%
5
30%
4
9%
3
14%
2
2%
1 ‐ strongly disagree
0%
5%
10%
15%
20%
25%
30%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
13

14. Building a Better Supply Chain
Supply Chain Success Factors
Ensure you have an appropriate plan for managing supply chain risk
We have a comprehensive, up-to-date plan that helps us manage supply chain risk.
6%
7 ‐ strongly agree
8%
6
27%
5
25%
4
16%
3
14%
2
3%
1 ‐ strongly disagree
0%
5%
10%
15%
20%
25%
30%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
14

15. 15
Building a Better Supply Chain
Supply Chain Success Factors
Strengthen the key supply chain skills your company needs to be successful
We have formal and effective processes for
recruiting and developing key supply chain
skills:
Which of the following best describes the
overall talent base in your supply chain
organization?
5%
7 ‐ strongly agree
5% 7%
Mostly or all “A”
players
8%
6
17%
5
A mix of “A” and “B”
players
31%
36%
4
Mostly or all “B”
players
14%
3
57%
17%
2
2%
1 ‐ strongly disagree
0%
10%
20%
30%
40%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
Generally “C” players
or below

16. Building a Better Supply Chain
Supply Chain Success Factors
Strengthen the key supply chain skills your company needs to be successful
The extent to which our supply chain organization uses 3PLs or similar firms:
11%
21%
Great extent
Moderate extent
Minor extent
33%
Not at all
34%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
16

17. Building a Better Supply Chain
Supply Chain Success Factors
Implement sophisticated demand forecasting capabilities
We have advanced systems and processes in place that enable us to create highly accurate
demand forecasts for which people are held accountable.
3%
7 ‐ strongly agree
11%
6
16%
5
19%
4
21%
3
22%
2
8%
1 ‐ strongly disagree
0%
5%
10%
15%
20%
25%
© 2013-2014 Supply Chain Edge LLC. All rights reserved.
17

18. 18
Contact Information
Joe Brady
Senior Partner
joe.brady@supplychainedge.com
440.653.0352
© 2013-2014 Supply Chain Edge LLC. All rights reserved.