organizational alignment study-summary charts-may 2013

TM

Organizational Alignment Study:

Summary ChartsMay 2013

Supply Chain Insights LLC Copyright © 2013, p. 2

Agenda

Study Overview

Alignment

Agility

Sales and Operations Planning (S&OP)

Supply Chain Role

Finance Role

Information Technology (IT) Role


Study Overview


Results from 3 Functional Roles:Supply Chain, Finance and IT


Respondents from a Mix of Discrete and Process Manufacturing Companies


Top Industries Represented Include Consumer Packaged Goods, Food & Beverage

and High Tech & Electronics


Respondents in Supply Chain Roles Come from Companies with Higher Revenue,

$4.4B on Average


Those in Supply Chain Are Mostly Directors+; Those in Finance and IT Tend

to Come from Lower Roles


Those in Supply Chain Role Are More Likely Than Finance or IT to Have

Open Design Network with Suppliers


Those in Supply Chain or IT Roles Are More Likely to Report Having Either a Supply Chain orBusiness Intelligence Center of Excellence


Those in Supply Chain or IT Are More Likely to Have Corporate Social Responsibility Goals


Agenda

Study Overview

Alignment

Agility


Supply Chain Role

Finance Role



Alignment between Manufacturing & Procurement Is Seen as Among the Most Important for All Three Roles


Alignment Is Most Apparent between Manufacturing & Procurement

and Sales & Marketing


Gaps in Alignment Are Among the Highestfor Sales & Operations and Sales & Marketing


For Supply Chain, the Largest Gap in Alignment Importance vs. Performance

Is for Sales & Operations


For Finance, the Most Important Areas forAlignment Are Among the Least Aligned


For IT, Two of the Largest Gaps in Alignment Importance vs. Performance Are for Sales & Marketing

and Manufacturing & Procurement


For Those in Supply Chain, Having a Centerof Excellence Means Greater Alignment forMarketing & Finance and CSR & Operations


For Those in Supply Chain, Having a Mature Agility Definition Means Greater Alignment

between Marketing & Finance


For Those in Supply Chain, Having Higher Agility Means Greater Alignment between Manufacturing

& Procurement, Sales & Operations and Operations & IT


For Those in Supply Chain, Having a More Mature S&OP Goal Means Greater Alignment between

Sales & Finance and Sales & Operations


For All 3 Groups, the Most Common Metrics IncludeOperating Margin, Cost of Goods Sold & Shipments


For All 3 Groups, 3 of the Top 5 Metrics IncludeOperating Margin, Shipments & Cost of Goods Sold


Those with a Supply Chain Center of ExcellenceAre Somewhat More Likely to Track Cost to Serve


Those with a Supply Chain Organization Are More Likely to Track Days of Inventory and Cost to Serve


Those with a S&OP Process Are More Likely to Track Operating Margin, Days of Inventory

and Volume Sold


Supply Chain Respondents Report 5 Most Important Metrics Are Operating Margin, Shipments,

Cost of Goods Sold, Days of Inventory & Volume Sold


For Supply Chain Respondents, the 5 Most Important Metrics Are Operating Margin, Shipments,

Cost of Goods Sold, Days of Inventory & Volume Sold


Finance Respondents Report 5 Most Important Metrics Are Operating Margin, Cost of Goods Sold, Shipments, Return

on Assets, Cash-to-Cash Cycle & Forecast Accuracy


Finance Respondents Report 5 Most Important Metrics Are Operating Margin, Cost of Goods Sold, Shipments, Return on Assets & Cash-to-Cash Cycle


IT Respondents Report 5 Most Important Metrics Are Operating Margin, Market Share,

Cost of Goods Sold, Shipments & Forecast Accuracy


Agenda

Study Overview

Alignment

Agility


Supply Chain Role

Finance Role



The Most Common Definition of “Supply Chain Agility” for All 3 Groups Is

Adapting to Variations in Demand and Supply


All 3 Groups Believe That Supply Chain Agility Is Important


For All 3 Groups, Less Than Half Think TheirSupply Chain Is Agile


Those in Supply Chain Report a Greater Gap in Supply Chain Agility Importance vs. Performance


Those in Supply Chain Are Somewhat More Likelyto Report Increased Agility

Than Those in Finance


For All 3 Groups, the Top Techniques forImprove Agility Include Improved Demand

Forecasting and Lean Manufacturing


Agenda

Study Overview

Alignment

Agility


Supply Chain Role

Finance Role



Those in Supply Chain Are More Likely Than Finance and IT to Report Having a S&OP Process


Those More Likely to Have S&OP Process:Have Supply Chain Organization or

Have Supply Chain Center of Excellence


Those in Supply Chain and Finance Are More Likely to Report Having

Two or More S&OP Processes


For Those in Supply Chain, the Most CommonS&OP Goal Is the Most Mature:

Maximize Opportunity and Mitigate Risk


Nearly Half of Those in Supply Chain Report That Their S&OP Process Is Effective


Among Supply Chain Respondents, S&OPPerformance Is Higher for Delivering Role-based

Views and Running What-if Analyses


For Supply Chain Respondents, the Top S&OP Challenges Are Not Having Technologies

or Executive Support


Supply Chain Respondents Report Wanting aHigher Frequency for S&OP Processes


Nearly Two in Five Supply Chain RespondentsReport That Their S&OP Plan Is Executed

Most or All of the Time


Collaborative Decision Making and Central View of Data Are Top Ways S&OP Technology

Supports Supply Chain Agility


Nearly Two in Five Report the S&OP Group HasResponsibility for S&OP Technology Budget,

Primarily Joint Responsibility


Agenda

Study Overview

Alignment

Agility


Supply Chain Role

Finance Role



Most Supply Chain Respondents Report Having a Formal Supply Chain Organization,

but Less Than One-Third Have Chief SCO


Nearly Half of Supply Chain Respondents with a Supply Chain OrganizationHave Had One for Over 10 Years


Supply Chain Planning, Transportation and Inventory Are Top Functions Reporting Through

the Supply Chain Organization


Most Supply Chain Leaders Report to the CEO, COO or President


Demand and Supply Volatility Are Among TopSupply Chain Pain for All Three Groups


While Those with a S&OP Process Report More Pain About the Speed of Business,

Those Without it Report More Regulations Pain


Over One-Third of Those in Supply Chain ReportHaving a Supply Chain “Center of Excellence”


Those More Likely to Have Supply Chain Center of Excellence: Process Industry, Have Supply Chain Organization, or Have S&OP Process


The Most Common Definition of Supply Chain Excellence Is

“Right Product, Right Place, Right Time at Right Cost”


Most Important Functions of Supply Chain Center of Excellence Are Planning, Identifying

Best Practices, and Strategy


Top Performing Functions of Supply Chain Center of Excellence Are Planning, Goals,

Identifying Best Practices and Strategy


Facilitation of Horizontal Processes and Inventory Strategies Are Functions

with Low Performing Relative to Importance


Over Half of Those with a Supply Chain Centerof Excellence Report It Is Effective


Agenda

Study Overview

Alignment

Agility


Supply Chain Role

Finance Role



Top Operational Finance Goal IsMaximizing Profitability


For Most, Operational Finance Goals AreLimited to the Company Only


Global Goal Setting and Regional PlanningAre Equally Common for Operational Finance


Half Report Company Success AtMeeting Operational Finance Goals


Agenda

Study Overview

Alignment

Agility


Supply Chain Role

Finance Role



One-Third of Those in IT Report Having IT Members with Career Through

Line of Business Roles


IT Respondents Report IT Role Is Focused onKeeping IT Safe and Driving Innovation

organizational alignment study-summary charts-may 2013

Business

supply chain roles

supply chain organization

operating margin

shipments cost of goods

sales finance

important metrics

finance respondents

greater alignment