1. Supply Chain Executive’s
Agenda 2010:
Key Trends and Strategies
Nari Viswanathan
Vice President/Principal
Analyst
Aberdeen Group
© AberdeenGroup 2009

2. Business Context: Integrated Demand-Supply
Networks Demand Network - Buyer of
services and products
Supply Network – Suppliers, For e.g: Retailers, Distributors,
Contract Manufacturers, ODMs, Value Added Resellers (VARs),
3PLs
Component
Factory
Customers
Enterprise – Sales, Marketing,
Raw Material Retail Store
System
Factory
Operations, Manufacturing,
Procurement
Enterprise
Suppliers
Logistics Network – 3PLs, Shippers, Carriers
Financial Network – Banks, Supply Chain Finance
Providers
© AberdeenGroup 2009 2

3. Session Agenda
 Mandate for the CSCO: Aligning Business
Goals with Supply Chain Strategies
 Priorities for the CSCO: Key Trends
 Action Plan for the CSCO: Key Takeaways
© AberdeenGroup 2009 3

4. Top Business Goals of 2010
Mis-alignment
n=350 for Executive Management ; n=226 for Supply Chain Professionals
Aberdeen Business Review
© AberdeenGroup 2009 4

5. Top 2 Challenges in Meeting 2010 Goals
Supply chain
and management
agree on need
for execution of
strategy
n=350 for Executive Management ; n=226 for Supply Chain Professionals
Aberdeen Business Review
© AberdeenGroup 2009 5

6. Top 2 Strategic Actions Being Taken in 2010
n=350 for Executive Management ; n=226 for Supply Chain Professionals
Aberdeen Business Review
© AberdeenGroup 2009 6

7. Session Agenda
 Mandate for the CSCO: Aligning Business
Goals with Supply Chain Strategies
 Priorities for the CSCO: Key Trends
 Action Plan for the CSCO: Key Takeaways
© AberdeenGroup 2009 7

8. Priorities of the Chief Supply Chain Officer
 Gaining Supply Chain Visibility &
Responsiveness is key requirement
 BI is becoming more focused on Operational
Issues
 Sales and Operations Planning is evolving into
Integrated Business Planning
 Collaboration is back: Trading Community
Management
 Cloud & SaaS approaches are ideally suited to
enable Integrated Demand-Supply Networks
© AberdeenGroup 2009 8

9. Why Should Companies Focus on Supply
Chain Visibility?
 Customer Service Advantage
 Best-in-Class versus Laggards - their percentage of
complete and on time orders delivered to customers is 15
percentage points higher
 A large gap in today’s customer driven environment
 Landed Cost Advantage
 Best-in-Class versus Laggards - more successful in
reducing their year-over-year landed costs per unit (an
almost 13 percentage point gap with Laggards)
 A big achievement in today's cost-conscious business
climate
© AberdeenGroup 2009 9

10. Priorities of the Chief Supply Chain Officer
 Gaining Supply Chain Visibility &
Responsiveness is key requirement
 BI is becoming more focused on Operational
Issues
 Sales and Operations Planning is evolving into
Integrated Business Planning
 Collaboration is back: Trading Community
Management
 Cloud & SaaS approaches are ideally suited to
enable Integrated Demand-Supply Networks
© AberdeenGroup 2009 10

11. Role Based BI Approaches
 High-level / KPI reporting (or "overlay") tools - most relevant to C-
level executives and top-level directors.
 Analytics / data-intensive analytical reports - most relevant to
specialized data analysts. These applications should provide
advanced analytics capabilities (including historical analysis and
forward-looking estimates) for supply chain specialists, with the
ability to perform root cause analysis and to drill down into specific
business areas. More focused on historical data
 Embedded analytics / SCI tools incorporated into other functional
applications (e.g. S&OP, procurement, transportation,
manufacturing shop floor etc), business analysts or mid-level
supply chain / operations managers for which BI is not a primary
job responsibility (operational users). More focused on real-time
data
Analytics & Operational BI: Enablers of Visibility and
Responsiveness
© AberdeenGroup 2009 11

12. Supply Chain BI Capabilities – Key to Success in
Multi-Enterprise Demand-Supply Networks
100% Best-in-Class Average Laggards
78%
75%
65%
55%
51% 47% 51%
50% 45%
37% 36% 36%
30% 28%
22% 19%
25%
7%
0%
Internal supply External supply Reports Analytics Supply chain
chain performance chain performance (statistical modeling (e.g.
dashboards scorecards analysis, trending, what-if scenarios,
route cause network design,
analysis etc) etc.)
© AberdeenGroup 2009 12

13. Priorities of the Chief Supply Chain Officer
 Gaining Supply Chain Visibility & Responsiveness is key
requirement
 BI is becoming more focused on Operational Issues
 Sales and Operations Planning is evolving into Integrated
Business Planning
 Collaboration is back: Trading Community Management
 Transportation and warehousing needs to be Integrated
with overall supply chain
 Cloud & SaaS approaches are ideally suited to enable
Integrated Demand-Supply Networks
© AberdeenGroup 2009 13

14. Elements of Integrated Business Planning
© AberdeenGroup 2009 14

15. Traditional S&OP Integrated Business Planning (S&OP 2.0)
Volumetric supply demand balancing only. Profitable alignment of supply, demand, product
and service. Risk management an important part
of the process.
Tactical process with limited linkage to overall Strategic technology-enabled process aligned and
business goals. integrated with financial and corporate goals and
metrics (C-Suite).
Primarily spearheaded by Sales or Operations Balanced process with equitable participation from
organizations. key stakeholders: Sales, Operations, Product
development, Finance and Service. Financial
planning and budgeting process integrates with
S&OP process
Limited sponsorship via LOB management. Primarily driven by top executive-level
sponsorship (C-Suite).
Internal process—no customer, partner Engages players in the value chain—active
engagement strategic customer and partner engagement.
Typically monthly or bi-weekly static process Dynamic, global, even event-driven based on
focused on tactical exception management. frequently scheduled and on ad hoc basis.
Some technology enablers to support the process. Advanced technology enablers covering analytics,
Typically, spreadsheet oriented or a standalone collaboration, optimization, simulation and what-if
solution. analysis. Global and local capabilities with real-
time visibility to demand, supply, and product
status. Integrated with ERP.
© AberdeenGroup 2009 15

16. Priorities of the Chief Supply Chain Officer
 Gaining Supply Chain Visibility &
Responsiveness is key requirement
 BI is becoming more focused on Operational
Issues
 Sales and Operations Planning is evolving into
Integrated Business Planning
 Collaboration is back: Trading Community
Management
 Cloud & SaaS approaches are ideally suited to
enable Integrated Demand-Supply Networks
© AberdeenGroup 2009 16

17. Process Steps Associated with Trading
Community Management
© AberdeenGroup 2009 17

18. Priorities of the Chief Supply Chain Officer
 Gaining Supply Chain Visibility &
Responsiveness is key requirement
 BI is becoming more focused on Operational
Issues
 Sales and Operations Planning is evolving into
Integrated Business Planning
 Collaboration is back: Trading Community
Management
 Cloud & SaaS approaches are ideally suited to
enable Integrated Demand-Supply Networks
© AberdeenGroup 2009 18

19. Highest Adoption Rates for SaaS in
Supply Chain Execution
© AberdeenGroup 2009 19

20. Key Takeaways
 Chief Supply Chain Officer role is becoming a reality
 Lowered workforce – 63% of companies indicate that
they are not going to hire in 2010
 However 38% indicate an increase in technology spend in
2010
 50% of companies indicate that sustainability has been
incorporated into some of the SCM processes and 25%
indicate that it has been incorporated into ALL SCM
processes
 Improved energy management and changing
transportation strategy are top two approaches towards
making supply chain more environment friendly
 Now more than ever, supply chain processes needs to
be customer facing
© AberdeenGroup 2009 20

21. © AberdeenGroup 2009 21