6. Why? The Long Tail of the Supply Chain:
Growing Complexity
Volume
Level of Predictability
Predictability based on forecast accuracy vs Actual Order Profiles
7. Demand
Signal
Accurate
Weekly
Forecasting
is ...
Delay from
Purchase to
Signal
Why? Data Latency and Distortion
Across the Network
Red Represents Emerging Economies with Distributor Trade
Retailer DC
Easy
3-10 Days
7-20 Days
Manufacturer DC
Difficult
10-20 Days
20-45 Days
Suppliers
Almost
Impossible
20-50 Days
45-80 Days
Store
Trivial
Instant
Variable
22. The Supply Chain Index
(Improvement)
The Supply Chain Index A new way to measure relative
Overall Ranking per Company
supply chain performance by
industry, based on the
components of balance, strength
and resiliency.
• Balance: Return on Invested Capital & Revenue Growth Vector Trajectory
• Strength: Inventory Turns & Operating Margin Vector Trajectory
• Resiliency: Inventory Turns & Operating Margin Mean Distance
27. Our Answer
+
Performance Improvement
Beats the industry
average for operating
margin, inventory turns
and ROIC for 2006-
2013
Ranks above peer
group average on
The Supply Chain
Index for 2006-2013
or 2009-2013
28. Supply Chains to Admire
Consumer Value
Networks
Industrial Value
Networks
42. Supply Chains to Admire
Consumer Value
Networks
Industrial Value
Networks
43. What Makes a Difference
• Leadership
• Building of talent
• Inside-out processes
• Horizontal process focus
• Active and intentional design
• Supply chain planning
44. What Does Not Work
• A project-based focus
• Vertical excellence without an end-to-end
focus
• Unchecked complexity
• Big bang projects
• Pushing cost and waste backwards in the
value network
46. Don’t Forget to Complete the
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