Strategic Supply Chain Management - Supply Chain Online

230 Strategic Supply Chain Management
FIGURE 6–1
Creating the roadmap to change.
Define the Supply Chain Strategy
1 2 3
Set the priorities Design the Adapt the
for change solution
supply chain
Operate the
supply chain
Process
Architecture
Organization
Performance
Management
Collaboration
Developing and executing the roadmap can be time-consuming and
resource-intensive but is the key to supply chain maturity and is well
worth the effort. A highly mature supply chain is one that has achieved
advanced capability across each of the core disciplines (see Figure 6-2).
Research by PRTM’s benchmarking subsidiary, The Performance
Measurement Group, LLC (PMG), finds that there is a strong correlation
between supply chain maturity and superior performance. Companies
with mature supply chains experience
◆
◆
◆
A 40 percent profitability advantage, where profitability is
expressed as earnings before income and tax as a percentage of
revenue
Average total supply chain costs just above 8 percent of revenue,
versus 10 percent for companies with less mature supply chain
practices
Superior customer service, with 25 percent less inventory
investment
ADVANCED SYSTEMS AREN’T ENOUGH
There is a strong
correlation between
supply chain maturity
and superior
performance.
Advancing your company’s supply chain
performance means moving from where
you are today to a future state that includes
next-generation processes and infrastructure,
including information systems. Technology
is only one part of the story—and
it isn’t the first chapter. Throughout this
book we have noted where the five core disciplines
can and should be enabled by effec-