Top 25 Supply Chains Pt. 1: Masters category

CJWehlage

Top 25 supply chains all utilize global networksOn May 29, 2014, I posted a blog about the Top 25 Supply Chains predictions for 2015.

“All that being said, here’s my early 2015 “Not So” Bold Predictions: #5 P&G, #4 Unilever, #3 McDonald’s, #2 Amazon, #1 Apple.”

Almost a year later, that was 100% correct. Ok, here’s my reasoning. The 2015 Top Supply Chains were #1 Amazon, #2 McDonald’s, #3 Unilever. What about my Apple and P&G prediction, you say? They were surprisingly put into a “Masters” category. As it is explained in the Gartner report, a “Master” is a supply chain that “consistently had top five composite scores for at least seven out of the last 10 years”. It’s bizarre to me, since a “hall of fame” category is reserved for someone who has retired. Plus, there was no explanation as to why seven out of the last 10 years was chosen. To me it felt more like a common thread between Apple & P&G was found first, then the Masters category was created.

I do submit that business changes, and quite abruptly. As quickly as Apple rose up the ranks to #2 in 2007, there could be changes that force the rankings to adjust. I would have preferred adding and changing the metrics to rank the companies rather that a category to remove two. I’m sure all the competition, while tired of the same rankings, would have preferred to battle it out against the best. Like the “Nature Boy” Ric Flair says, “In order to be the man, you have to beat the man.”

I mentioned another quote in my May 2014 blog, “The more things change, the more they stay the same”– Jon Bon Jovi, 2010, Greatest Hits. In 2015’s Top 25 Supply Chains, if Apple and P&G were part of the list, there’s really only one change from the 2014 to 2015 ranks. Caterpillar falls out and L’Oreal comes in.

So, I decided to check even more data on what’s changed over the years. I went back five years to the 2011 Top 25 Supply Chain rankings. Of the 25 in 2011, there are 18 (72%) that are the same. Seven from 2011 are not on the 2015 ranks.

  • Dell – took themselves out by going private
  • Kraft – got acquired by HY Heinz
  • Research in Motion (RIM) – came in at #9 in 2010, went to #4 in 2011, then out of the Top 25
  • Microsoft, IBM, and Tesco fell out of the Top 25

So, as you can see, not much has really changed in the rankings over the years. I do think it’s time to rethink the measures for the Top 25. I love the new Gartner Supply Chain Benchmarking model. While it requires a company to state key supply chain KPI’s, if enough companies join, and there can be sufficient privacy control on the numbers, this could lead to a much better ranking.

The one data set I do like to drill down on is the Peer vs. Analyst vote. Each year, it’s abnormal how this varies.

Company Peer Vote Rank Company Analyst Vote Rank
Amazon 1 Unilever 1
Unilever 2 Cisco 2
Coca Cola 3 Intel 3
Walmart 4 Amazon 4
McDonald’s 5 Samsung 5
Starbucks 6 PepsiCo 6
J&J 7 Colgate Palmolive 7
3M 8 Inditex 8
Cisco 9 Coca Cola 9
Nestle 10 McDonald’s 10

 

Only Unilever received a common ranking between both Peers and Analysts. I would have to assume both Apple and P&G would be another common vote, if they were not removed.

There are five (half of the list) that are not common. Peer’s voted Walmart, Starbucks, J&J, 3M and Nestle in the top 10, while those companies were not in the Analyst top 10. One has to ask, what do the Peers see in that the Analysts don’t? Or, conversely, what do the Analysts see in Intel, Samsung, PepsiCo, Colgate Palmolive and Inditex, that the Peers don’t?

Stay tuned for part two of this blog series that explores what I believe will be the deciding factor among top supply chains in the future.

CJWehlage

CJ joined Kinaxis in 2013 with the responsibility to guide the company’s industry strategy within the high tech vertical.

With extensive experience, both as a supply chain practitioner and an industry research analyst, CJ serves as a strategic advisor to the company, while also supporting global field teams and working with prospects and customers as they define and pursue supply chain excellence strategies.

C.J. Wehlage has over twenty three years of industry experience as a supply chain professional, researcher, and technologist. Before joining Kinaxis, he was VP of High Tech Sales at Jonova, and prior to that, VP of Supply Chain at Sony Electronics. CJ was also ran the High Tech Practice at AMR Research, responsible for supply chain best practice research & thought leadership in the high tech industry. In addition, Wehlage has held leadership roles at EMC, where he was responsible for S&OP, Manufacturing M&A, Supply Chain IT, and Lean design; Bose, where he led a large scale ERP integration, and Apple, where he led Pacific Operations & WW Desktop Planning. C.J. has also served as an adjunct professor at Northeastern University, APICS CSCP, Six Sigma Black Belt, and a frequent speaker at supply chain conferences.

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