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2006 Pros to Know
By Andrew K. Reese and Sarah Murray
Supply & Demand Chain Executive honors today’s supply chain leaders
n our sixth annual Pros to Know issue, Supply & achieve — goals that bring beneﬁts to the enterprise as a
Demand Chain Executive is again highlighting whole.
those executives working day in and day out to give This year, as in the past, we highlight not just supply
companies a competitive edge by transforming their chain Practitioner Pros to Know — executives at
supply chains. This year, our theme was leadership. manufacturing or non-manufacturing enterprise charged
What is leadership? Retired Gen. Colin Powell, with managing and transforming their company’s
keynoting at the Transformation ‘06 conference put on supply chain — but also Provider Pros to Know,
by Yellow Transportation in Las Vegas this February, executives working at software ﬁrms, service providers,
said that the essence of leadership is, in fact, the ability and consultancies and research ﬁrms who have made
to create “followership.” It’s knowing where you’re signiﬁcant contributions to the supply chain ﬁeld.
going, and how you’re going to get there, such that In today’s economic environment, the ability of
those in your charge will follow you, in Gen. Powell’s executives at supply chain solution providers to
words, “if only out of curiosity.” demonstrate leadership is increasingly becoming a
As on the ﬁeld of battle, in the supply chain world, differentiator for their enterprise customers. Supply &
leadership is the quality that allows executives to rally Demand Chain Executive salutes this year’s Pros to
colleagues to the cause of supply chain transformation Know, who are contributing to companies’ competitive
in a time of uncertainty; to effect change in the face advantage and, in doing so, transforming Supply Chain
of entrenched constituencies and institutional inertia; into a leading, value-creating function within today’s
and to transcend functional interests to pursue — and global corporations.
Vice President, Working Capital Solutions
For his work in evangelizing the principles of Supply Chain Speciﬁcally Kramer has helped clients:
Finance and helping companies master the increasing • Deploy technology that connects trading partners with
complexities of global supply networks, Supply & Demand ﬁnancial institutions to provide a common global view
Chain Executive recognizes Robert Kramer as a 2006 of supply chain events, the ﬂow of funds and the ﬂow of
Provider Pro to Know. goods and services between them.
Macroeconomic trends are transforming traditional • Enable the processing of “on-demand” Supply Chain
supply chains into increasingly complex, loosely linked Finance transactions by suppliers who seek to optimize
transnational supply networks, and Robert Kramer their unique cost, capital and risk structures at multiple
is helping Global OEMs master this new world of decision points.
complexity through a heightened focus on “Supply Chain • Design new analytic frameworks to help OEMs
Finance” (SCF). identify the impact of their increasingly decentralized
Supply chain trends such as ousourcing and supply chains on their individual cost, capital and risk
globalization have combined to transfer manufacturing structures.
expense and associated capital investments out to suppliers • Develop new ﬁnancial and behavioral models to identify
at a rapid pace. Today OEMs outsource over 50 percent of and quantify the ﬁnancial impact of supply chain ﬁnance
their manufacturing activities, with many over 75 percent. inefﬁciencies on the OEM and their suppliers.
In addition to holding inventory, suppliers now make a • Design solutions that maximize value for both the
majority of the capital investment decisions that impact OEM and their suppliers based on the unique objectives
end product price and quality. of the OEM and their supply chain
Further, rapid decentralization demographics.
has caused supply chains to Kramer’s personal role in educating
behave more like the decentralized companies about supply chain
networks of the capital markets, with management and B2B e-commerce has
many independent actors making included helping different functional
independent value optimization groups within the enterprise develop
decisions, often based on poor consensus despite their diverse — and
information and inadequate access sometimes conﬂicting — objectives. He
to ﬁnancial and risk management also has worked to evangelize Supply
tools. While investment and resource Chain Finance concepts to trading partners
allocation decisions are increasingly big and small throughout client supply
made at the supplier level, the chains, helping them recognize the value
information and resources required to they are receiving from the OEM’s SCF
optimize these decisions are often held implementation.
by the OEM. Looking ahead, Kramer believes that
Kramer believes that traditional global supply chain leaders (OEMs or
command and control structures, designed for centralized “brand owners”) will more easily and quickly understand
and vertically integrated supply chains, are no longer the quantitative effects of their decentralized supply
adequate for managing today’s networked supply chains. chains on their individual cost structures. Top quartile
Simply automating manual command and control organizations will take a total supply chain view and use
structures or treating the supply chain as a static linear technology to harness the power of distributed decision
network will not maximize value to the OEM or the making by suppliers. This technology will provide
supply chain, he says. information connectivity and on-demand transaction
Driven by these beliefs, Kramer has helped advanced processing to both their suppliers and the capital markets.
the ﬁeld of supply chain technology and supply chain “The abilities and creativity of the global capital
management by assisting Global OEMs understand the markets will be brought to bear on the corporate supply
root causes of inefﬁciencies within the cost, capital and chain as they never have before, dramatically reducing
risk structures of their supply chains. He has helped them cost, risk and capital inefﬁciencies,” Kramer says. “The
make decisions on how to holistically address these root combination of improved information quality and
causes and deploy solutions centered on “Supply Chain velocity along with distributed decision making has
Finance.” These solutions leverage technology and the been the hallmark of process efﬁciency throughout
power of the global capital markets to optimize supply the information revolution. Working capital tied up
chain performance. The impact on shareholder value is in the accounts payable and receivable processes, now
sizeable, with potential increases in free cash ﬂow of $50 comprising $6 trillion in the United States alone will, for
million per $1 billion in revenue through optimization of the ﬁrst time in over 25 years, begin to fall more rapidly
the underlying business processes. than inventory levels.”
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