Supply chain index webinar for healthcare

Healthcare Value
Networks: How Do You
Measure UP?
The Supply Chain Index
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Supply Chain Insights LLC Copyright © 2014, p. 2
Supply Chain Insights is focused on delivering
independent, actionable and objective advice for
supply chain leaders.
A company dedicated to research,
turn to us when you want the latest insights
on supply chain trends, technologies to know and
metrics that matter.
About Us
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Presenters
Abby Mayer
Research Associate
Lora Cecere
Founder and CEO
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Dr. George Runger
Professor, CIDSE, ASU

Agenda
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A Supply Chain
is a Complex System
with Complex
Processes
with Increasing
Complexity
Our Belief
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 Resilient and predictable
 Balanced across the set of metrics
to maximize value
 Showing year-over-year strength
against peer group
Desired Corporate Performance
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The Supply Chain Effective Frontier:
First Representation
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While we like this framework, there is no good
source of consistent and accurate data for:
– Forecast Accuracy
– Case Fill Rate
– Corporate Social Responsibility
Problem with this Framework
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The Supply Chain Effective Frontier:
Second Representation
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In most supply chains, complexity has risen throwing the
supply chain out of balance. We find that nine out of ten
companies are stuck at the intersection of inventory turns
and operating margin.

Industry Overview
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Progress over the Last Twelve Years
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Intersection of
Operating Margin and Inventory Turns
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Companies Get More Serious
With A Recession
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Today’s Supply Chain
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A Business Continuity Risk
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Agenda
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Mining 20 Years of Financial Data
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Correlations to Market Capitalization
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“No significant supply chain
improvement happens in less than
three years….”
Marty Kisluik, FMC
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How to Read an Orbit Chart
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Supply Chain Metrics That Matter Reports
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Agenda
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Supply Chain Metrics That Matter Reports
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What is Resiliency?
Tightness of the Pattern
on the Orbit Chart for
Operating Margin and
Inventory Turns

Abbott Laboratories & Shire PLC
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Boston Scientific Corporation
& Stryker Corporation
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GlaxoSmithKline PLC & Merck & Co., Inc.
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Resiliency 2000-2012
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Agenda
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Overall Ranking per Company
• Balance: Return on Invested Capital & Revenue Growth Vector Trajectory (30%)
• Strength: Inventory Turns & Operating Margin Vector Trajectory (30%)
• Resiliency: Inventory Turns & Operating Margin Mean Distance (30%)
• Peer: Peer Rankings by Industry (10%)
The Supply Chain Index
A new way to measure relative
supply chain performance by
industry, based on 4 components:
balance, strength, resiliency and
peer rankings.
Supply Chain Index:
A Measure of Supply Chain Improvement
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The Index Framework
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Supply Chain Index
30% 30% 30% 10%
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What is the right weighting?
What is the right time period?

Looking at the Value Network
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Industry Overview: 2006-2012
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Supply Chain Index:
Hospital for 2006-2012
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Supply Chain Index:
Hospital for 2009-2012
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Pharmaceutical Industry
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Supply Chain Index:
Pharmaceutical for 2006-2012
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Supply Chain Index:
Pharmaceuticals for 2009-2012
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Medical Device
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Supply Chain Index:
Medical Device 2006-2012
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Supply Chain Index:
Medical Device for 2009-2012
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• Industries and companies in the healthcare value network have struggled
to improve supply chain processes. With high margin, there is low priority
on supply chain excellence.
• Nine out of ten companies are stuck on the Effective Frontier. The project
approach versus a clear operating strategy was detrimental.
• Supply chain resiliency is improving. However, the lack of resiliency of
contract manufacturing and 3PLs should be a risk concern for all
manufacturers.
• Large companies, that were early adopters, made great progress at the
beginning of the decade, but progress has slowed. The Supply Chain
Index shows that their progress has been eclipsed by late followers.
What Have We Learned?
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Agenda
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Next Steps
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• Supply Chain Index Webinars
• August 12- Industrial Value Network
• Monthly Research Reports
• July 22- Healthcare Value Network
• August 19- Industrial Value Network
• Final analysis of companies to be revealed at the 2014
Supply Chain Insights Global Summit

Metrics That Matter
• Lora Cecere’s 2nd book:
Metrics That Matter
• To publish in Fall 2014
http://tinyurl.com/metricsthatmatter
Pre-orders available on Amazon:
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What’s Happening at
Supply Chain Insights?
www.supplychaininsights.com
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About Lora Cecere
• Founder of Supply Chain Insights
• Invited to be a “LinkedIn Influencer”
• Invited to write a guest blog for Forbes
• Author of 2 books: Bricks Matter (2012) and
Metrics That Matter (to publish Fall of 2014)
• Partner at Altimeter Group (leader in open research)
• 7 years of Management Experience leading Analyst Teams at Gartner and
AMR Research
• 8 years Experience in Marketing and Selling Supply Chain Software at
Descartes Systems Group and Manugistics (now JDA)
• 15 Years Leading teams in Manufacturing and Distribution operations for
Clorox, Kraft/General Foods, Nestle/Dreyers Grand Ice Cream and
Procter & Gamble.
Contact Information:
• Email: lora.cecere@supplychaininsights.com
• Blog: www.supplychainshaman.com (6000 pageviews/month)
• Forbes: http://www.forbes.com/search/?q=lora+cecere
• Twitter: lcecere (4800 followers)
• LinkedIn: linkedin.com/pub/lora-cecere/0/196/573 (7000 in the network)
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Supply chain index webinar for healthcare

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Supply chain index webinar for healthcare