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The Third Annual Global Survey of Supply Chain Progress
Findings from a survey jointly conducted by Computer Sciences Corporation (CSC) and Supply Chain Management Review (SCMR)
Table of Contents
Executive Summary 4
Summary of 2005 Respondents 7
Breakdown by Industry 7 Breakdown by Geographic Location of Headquarters 7 Breakdown by Type of Organization 8 Functions Included in Supply Chain Organization 8 Technologies Being Used to Advance Supply Chain Evolution and Drive Results 9 Five Levels of Supply Chain Evolution 9 Status of Supply Chain Initiatives 10 Realized Results of Each Initiative 10 Three Factors that Played the Greatest Roles in Your Most Successful Supply Chain Initiatives 11 Statements that Apply to Your Company’s Supply Chain Strategy 11 Alignment of Supply Chain Strategy with Corporate Strategy 12 Frequency of Review of Supply Chain Strategy 12 Comparison of Your Company to Others in the Same Industry of Supply Chain Excellence 13 Supply Chain Spending as a Percent of Revenue 13 Costs Included in Supply Chain Spending 14 Change in Supply Chain Spending Over the Past Three Years 14 Expected Change in Supply Chain Spending in the Next Three Years 15 Projected Supply Chain Investment Over the Next Three Years 15 Rational Behind Future Supply Chain Investments 16 Overall Impact of Supply Chain Initiatives in the Past Year on Cost 16 Overall Impact of Supply Chain Initiatives in the Past Year on Revenue 17 How Closely is Supply Chain Strategy Linked to Profit and Loss Statement and Balance Sheet? 17 To Whom Does Your Most Senior Supply Chain Executive Report? 18
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 2
Effectiveness of Supply Chain Leadership and IT Leadership Collaboration on Introducing New Technologies to Improve Business Performance 18 Development Areas in the Supply Chain Organization that Need the Most Work 19 Percent of Importing/Exporting Done in Business 19 Supply Chain Vulnerability Reviews 20 Plans to Initiate Supply Chain Vulnerability Reviews 20 Presence of a Written Contingency Plan in Case of a Significant Disruption 21 Level of Agreement with Statements 21 Degree to which Product Development Strategy is Synchronized with Strategic Sourcing Strategies 22 Sharing of Standardized Bills of Material with Tier 1 Suppliers and Design Partners 22 Impact of Engineering Change Orders on Supply Chain Partners’ Ability to Respond 22
Methodology 23
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 3
EXECUTIVE SUMMARY
Executive Summary
Majority of Supply Chain Professionals Report Impressive Gains with Efforts.
Future Work will Require Greater Collaboration and More Focused Application of Technology.
For the third consecutive year, CSC and Supply Chain Management Review (SCMR) magazine collaborated on a global survey among supply chain professionals across a range of 18 industries to determine exactly what progress is being made with supply chain efforts and what issues have current relevance. The survey is notable for the revelations that: companies have managed to break through the obstacles that have kept many of them mired in the middle of the CSC Supply Chain Maturity Model; and most respondents are indicating they are making significant progress over what was recorded in the first two surveys.
CSC Supply Chain Maturity Model
IEnterpriseIntegration
IICorporateExcellence
IIIPartner
Collaboration Collaborative Commerce
IVValue Chain
Constellation
External
Most have achieved Level II (today’s market).
Functional/Process
Intra-Enterprise
Inter-Enterprise
The “Innovators” are poking through or jumping over the wall to III and IV (tomorrow’s market).
VFull NetworkConnectivity
Total BusinessSystem
The 2005 results confirm that achievement of significant results in cost reduction is possible with a concerted supply chain improvement effort, as 61 percent of respondents indicated reductions to supply chain costs from one to 10 percent, and an additional 13 percent indicating they had saved 11 to 20 percent. Additionally, there is evidence that companies are using the results from their improved processing to generate revenue increases. Fifty-two percent of those responding indicated they had increased revenues by 1 to 10 percent, with another 11 percent indicating they had enjoyed increases from 11 to 20 percent or more. These combined figures now provide solid evidence that serious attention to supply chain management can bring five to eight points of new profit to a firm’s financial statements.
Most respondents now rate their progress on the CSC Supply Chain Maturity Model as beyond building internal excellence and efforts to establish network competence. Indeed, while 50 percent of the firms responding place their firms in levels one and two of the model, the other 50 percent say they have progressed into level three or
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 4
EXECUTIVE SUMMARY
beyond or into areas where collaboration and technology are required to reap higher levels of achievement. The new supply chain frontier appears: as conquering levels in the model that are the least well understood must now be faced. Collaborating with trusted business partners to share knowledge electronically and using the knowledge to achieve the highest levels of benefit are what will distinguish the future supply chain leaders.
The status of specific initiatives and realized results show most firms are moderately successful across the board, with the best results coming from continued efforts in strategic sourcing of indirect and direct materials, sales and operations planning, strategic inventory planning, advanced planning and scheduling, supplier relationship management and supply chain visibility. These results are very interesting as previous surveys failed to show nearly as much progress with planning activities. There is a concerted movement forward in nearly all categories of supply chain initiatives, another indication that firms are breaking through the obstacles that have kept them stuck in the middle of the supply chain progression.
The biggest progress was reported this year with regard to supply chain strategy. Only 5 percent indicated they had no such strategy, down from 10 percent last year. More decisively, 38 percent say supply chain is developed and executed at the division or business unit level versus 18 percent in 2004. Forty-nine percent say supply chain strategy is aligned with corporate strategy and 57 percent say it is being reviewed formally every year — more evidence that supply chain is gaining the attention of executive management as a critical business driver. Paradoxically, 32 percent of all respondents indicate they are only in the process of developing a supply chain strategy. There are still some laggards.
Most firms continue to indicate they rely on technology to get them into and through the advanced levels of the model. The usual technologies were cited, including ERP systems, e-procurement, inventory planning, web-based applications/services, warehouse management systems, and advanced planning being the favorite areas. In particular, a big jump forward was noted in attention being paid to radio frequency identification (RFID) technology, which went nearly unnoticed in last year’s survey. Sixteen percent of the respondents listed RFID among the technologies being used to drive results. With regard to projected supply chain investments expected to be made over the next three years, investment in RFID moved from almost no plans to 31 percent indicating interest in investing in this emerging technology.
It is worth noting that while risk and vulnerability remain crucial issues for supply chain professionals, the survey once again did not show the kind of concern or preparedness we would expect. While the survey showed there was considerable concern for a host of issues related to supply chain vulnerability, when asked if the supply chain organization had contingency plans in case of significant disruption, 54 percent replied negatively. Inventory planning and inventory level strategy remains the primary concern, but with the increase in global shipments experienced by most firms, a new set of issues is emerging. International freight movement, new import or customs regulations, and critical trading partner vulnerabilities are now of concern to 30 percent or more of the firms responding. Clearly, with all of the progress reported, vulnerability looms as an issue to be conquered before supply chain efforts are deemed complete.
Regarding which areas need more development, the responses indicated few areas where there was not some concern. Developing a business case for supply chain investment was near the top in the areas needing work, in spite of the documented savings to costs and improvements to revenues. Finding the means to collaborate more effectively — internally and externally — is still one of the major problems confronting the supply chain professional. When we inquired if the company had a standardized enterprise-wide Bill of Material that was shared with Tier 1 supply chain and design partners, 75 percent said “No”! Despite the advances indicated by this year’s results, there appears to be a full plate of opportunities still to be attacked.
RFID requires a case for investment for most firms, while internal collaboration continues to be a concern in spite of companies rating their progress as beyond level three. Understanding new technologies had a surprisingly high need rating.
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 5
EXECUTIVE SUMMARY
We noted in previous survey results that cooperation between supply chain leadership and IT leadership was improving, and this year we found even further progress in this important element of success. Two-thirds of those replying indicated a rating of three or higher (on a five-point scale) in effectiveness of the two groups to introduce new technologies that can improve business performance.
That brings us to the new call for action. When we finished reviewing our survey results, we took some additional time to compare these results with documented feedback from another eight reputable organizations reporting on supply chain efforts. The findings came across with a clear mandate for gaining and holding improvements. Here are a few observations based on this combined analysis:
• Supply chain management (SCM) efforts deliver the greatest results when SCM is part of an overall business strategy — it should not be a standalone effort.
• SCM is most likely to under deliver when there is poor connection between functions across a total business — often noted by poor supply chain visibility and lack of best practice sharing internally.
• While technology is an absolute necessity for advanced supply chain progress, poor impact of technology as an enabler is still a major thorn in the side of many practitioners.
• Despite potential economies from global supply chain efforts, most companies optimize locally. • In spite of the rhetoric around the importance of customers, few firms are collaborating closely with key
customers. • Companies continue to install software before rethinking their underlying processes and expect root cause
problems to be eliminated.
In general, companies across the industries represented are continuing their relentless march forward with supply chain as a business driver. But the roadmap is not being followed in many instances, as firms slide off the path to optimization as they concentrate on local conditions. To reach the highest levels of potential improvement it is now time to get the train on the tracks and move forward with what are clearly proven techniques. That means collaborating more effectively internally to optimize processing, and then working with key suppliers and customers to more effectively apply technology as an enabler and factor in achieving total success.
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 6
SUMMARY OF 2005 RESPONDENTS
Summary of 2005 Respondents
Breakdown by Industry
6%1%
3%
8%0%
2%1%
0%6%
11%
10%3%
4%1%
4%6%
2%
7%1%
4%10%
0% 2% 4% 6% 8% 10% 12%
OtherWholesale/Distribution
UtilitiesThird Party Logistics Provider
TelecommunicationsRetail
Publishing and PrintingProfessional Services
Oil and GasMining and Metals
Manufacturing-ProcessManufacturing-Discrete
High-TechHealthcare
GovernmentFood Services
Financial ServicesConsumer Goods
ChemicalsAutomotive
Aerospace and Defense
Breakdown by Geographic Location of Headquarters
Q32: Where is your company headquartered?
Other – 9%
North America – 71%
Europe – 9%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 7
SUMMARY OF 2005 RESPONDENTS
Breakdown by Type of Organization
Q29: Describe the organization for which you are responding.
Division, Wholly Owned Subsidiary, or SBU – 22%
Corporate – 55%
Group, Multiple Division – 23%
Functions Included in Supply Chain Organization
Q31: Which of the following functions are included in your supply chain organization? (Mark all that apply)
86%
30%
69%
75%
16%
35%
48%
6%
80%
0% 20% 40% 60% 80% 100%
Other
Marketing, Sales, and Customer Service
Inventory and Materials Management
Logistics, Transportation, and Warehousing
Purchasing, Procurement, and Sourcing
Forecasting, Planning, and Scheduling
Manufacturing
Supply chain Software and Technology
Supplier/Customer Collaboration (SRM/CRM)
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 8
SUMMARY OF 2005 RESPONDENTS
Technologies Being Used to Advance Supply Chain Evolution and Drive Results
Q2: What technologies are you using to advance your supply chain evolution and drive results?
43%
43%
20%
13%
48%
17%
52%
30%
14%
34%
46%
28%
16%
62%
0% 20% 40% 60% 80%
RFID
Transportation Management System (TMS)
Supplier Relationship Management (SRM) Application
Advanced Planning, Forecasting, and Scheduling System
E-Procurement and Business-to-Business Exchanges
Web-based Application/Services
Collaborative Planning, Forecasting, and Replenishment (CPFR)
Just-in-Time (JIT)/Kanban
Warehouse Management System (WMS)
Inventory Planning, Analysis, Optimization System
Supply Chain Event Management System
Customer Relationship Management (CRM) Application
Collaborative Product Design, Engineering, Manufacturing Application
ERP System
Five Levels of Supply Chain Evolution
Q33: Please identify your company's current stage of development for each of the business applications.
0% 20% 40% 60% 80% 100%
Returns, Repairs, Recycling, Maintenance
RFID
Manufacturing
Purchasing, Procurement, and Sourcing
Inventory and Materials Management
Logistics, Transportation, and Warehousing
Product Management, Design, and Engineering
Supplier/Customer Collaboration (SRM/CRM)
Marketing, Sales, and Customer Service
Supply Chain Software and Technology
Forecasting, Planning, and Scheduling
Level 1 & 2: Internal OptimizationLevel 3: Advanced Supply Chain ManagementLevel 4: eCommerce: Value Chain CollaborationLevel 5: eBusiness: Full Network Connectivity
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 9
SUMMARY OF 2005 RESPONDENTS
Status of Supply Chain Initiatives
Q3A: How successful are your initiatives driving supply chain advancement? For each initiative, mark the status.
0% 20% 40% 60% 80% 100%
RFID
Customer Relationship Management
Supplier Relationship Management
Strategic Sourcing of Direct Materials
Strategic Inventory Planning
Strategic Sourcing of Indirect Materials
Collaborative Planning with Key Customers/Suppliers
Supply Chain Network Design/Analysis
Business Intelligence Systems
Collaborative Design and Product Development
Network Partnerships
Complete
In Progress
Planned (Next 12 Months)
Planned (2-5 Years Out)
No Plans
Supply Chain Visibility and Event Management
Sales and Operations Planning
Advance Planning and Scheduling
Realized Results of Each Initiative
Q3B: How successful are your initiatives driving supply chain advancement? Rate each initiative by its realized results.
0% 20% 40% 60% 80% 100%
RFID
Customer Relationship Management
Supplier Relationship Management
Strategic Sourcing of Direct Materials
Strategic Inventory Planning
Strategic Sourcing of Indirect Materials
Collaborative Planning with Key Customers/Suppliers
Supply Chain Network Design/Analysis
Business Intelligence Systems
Collaborative Design and Product Development
Network Partnerships
Highly Successful
Moderately Successful
Moderately Disappointing
Highly Disappointing
No Opinion/In Progress/ Not Complete
Supply Chain Visibility and Event Management
Sales and Operations Planning
Advance Planning and Scheduling
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 10
SUMMARY OF 2005 RESPONDENTS
Three Factors that Played the Greatest Roles in Your Most Successful Supply Chain Initiatives
Q4: What three factors played the greatest roles in your most successful supply chain initiatives?
14%
57%
34%
27%
27%
10%
43%
22%
18%
6%
31%
0% 20% 40% 60% 80%
Other
Performance Measures Aligned to Desired Outcomes
Trust Between Workers and Senior Management
High Goals Set at Onset
Technology Enablers Established and Operating
Awareness of Need to Increase Customer Satisfaction Ratings
Project Management Clearly Established and Executed
Realistic Business Case Established to Track Results
Collaboration with Supply Chain Partner(s)
Awareness of Need to Substantially Reduce Inventories
Visible and Active Senior Executive Commitment to Outcomes
Statements that Apply to Your Company’s Supply Chain Strategy
Q1. Mark all statements that apply to your company's supply chain strategy.
31%
29%
40%
21%
30%
17%
4%
0% 10% 20% 30% 40% 50%
Our supply chain strategy is shared and common with our supply chain partners
We are in the process of developing a supply chain strategy
We do not have a supply chain strategy
Our supply chain strategy is comprehensive across the entire corporation
Our supply chain strategy is developed and executed at the division/business unit level
Our supply chain strategy is integrated into our business strategy
Our supply chain strategy is developed and executed at the department level
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 11
SUMMARY OF 2005 RESPONDENTS
Alignment of Supply Chain Strategy with Corporate Strategy
Q5: How well is your supply chain strategy aligned with your overall corporate strategy?
1 = not at all aligned 5 = fully aligned
1 – 3%
4 – 38% 2 – 17%
3 – 31%
5 – 11%
Frequency of Review of Supply Chain Strategy
Q6: How often does your organization formally review or update its supply chain strategic plan?
Every Five Years – 1%
Every Year – 56% Every Other Year – 5%
As Business Conditions Dictate – 27%
Every Three Years – 2%
Other – 9%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 12
SUMMARY OF 2005 RESPONDENTS
Comparison of Your Company to Others in the Same Industry of Supply Chain Excellence
Q7: How does your company compare to other companies in your industry in terms of supply chain excellence?
My Company is the Leader – 27%
My Company is a Quick Adopter – 36%
My Company is a Laggard – 37%
Supply Chain Spending as a Percent of Revenue
Q10: What is your supply chain spending as a percent of revenue?
29%
8%
7%
7%
8%
19%
20%
0% 10% 20% 30% 40%
Less than 5%
Between 5% and 10%
Between 11% and 20%
Between 21% and 30%
Between 31% and 40%
Between 41% and 50%
Greater than 50%
Less than 5%
Between 5% and 10%
Between 11% and 20%
Between 21% and 30%
Between 31% and 40%
Between 41% and 50%
Greater than 50%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 13
SUMMARY OF 2005 RESPONDENTS
Costs Included in Supply Chain Spending
Q11: What costs are included in this?
83%
30%
53%
66%
16%
30%
53%
15%
5%
77%
0% 20% 40% 60% 80% 100%
Supply Chain Software and Technology
RFID Compliance Costs
Other
Purchasing, Procurement, and Sourcing
Logistics, Transportation, and Warehousing
Manufacturing
Forecasting, Planning, and Scheduling
Inventory and Materials Management
Marketing, Sales, and Customer Service
Supplier/Customer Collaboration (SRM/CRM)
Supply Chain Software and Technology
RFID Compliance Costs
Other
Purchasing, Procurement, and Sourcing
Logistics, Transportation, and Warehousing
Manufacturing
Forecasting, Planning, and Scheduling
Inventory and Materials Management
Marketing, Sales, and Customer Service
Supplier/Customer Collaboration (SRM/CRM)
Change in Supply Chain Spending Over the Past Three Years
Q12: How has your relative level of supply chain spending changed over the past three years?
Significantly Lower (more than 30%) – 4%
Somewhat Higher (from 10 to 30%) – 31% Somewhat Lower (from 10 to 30%) – 20%
About the Same (within +/- 10%) – 38%
Significantly Higher (more than 30%) – 7%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 14
SUMMARY OF 2005 RESPONDENTS
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 15
Expected Change in Supply Chain Spending in the Next Three Years
Q13: How will your relative level of supply chain spending change in the next three years?
Significantly lower (more than 30%) – 5%
Somewhat higher (from 10% to 30%) – 35% Somewhat lower (from 10% to 30%) – 19%
About the same (within +/- 10%) – 32%
Significantly higher (more than 30%) – 9%
Projected Supply Chain Investment Over the Next Three Years
Q14: In which areas of the supply chain are you projecting investment over the next three years?
60%
55%
45%
17%
40%
42%
19%
30%
17%
19%
2%
48%
0% 20% 40% 60% 80%
Forecasting, Planning, and Scheduling
Returns, Repairs, Recycling, and Maintenance
RFID
Product, Management, Design, and Engineering
Other
Purchasing, Procurement, and Sourcing
Logistics, Transportation, and Warehousing
Inventory and Materials Management
Marketing, Sales, and Customer Service
Supplier/Customer Collaboration (SRM/CRM)
Supply Chain Software and Technology
Manufacturing
Forecasting, Planning, and Scheduling
Returns, Repairs, Recycling, and Maintenance
RFID
Product, Management, Design, and Engineering
Other
Purchasing, Procurement, and Sourcing
Logistics, Transportation, and Warehousing
Inventory and Materials Management
Marketing, Sales, and Customer Service
Supplier/Customer Collaboration (SRM/CRM)
Supply Chain Software and Technology
Manufacturing
SUMMARY OF 2005 RESPONDENTS
Rational Behind Future Supply Chain Investments
Q15: What is the rational behind your projected future supply chain investment?
45%
36%
9%
5%
5%
0% 10% 20% 30% 40% 50%
My existing supply chain investment will meet my business needs for the nest 1-3 years
Seeking competitive advantage with a cost reduction strategy
Changes in the macro economic environment
Seeking competitive advantage with agrowth strategy
Cost for doing business
My existing supply chain investment will meet my business needs for the nest 1-3 years
Seeking competitive advantage with a cost reduction strategy
Changes in the macro economic environment
Seeking competitive advantage with agrowth strategy
Cost for doing business
Overall Impact of Supply Chain Initiatives in the Past Year on Cost
Q16: In the past year, what has been the overall impact of your supply chain initiatives on cost?
36%
11%
3%
3%
19%
28%
0% 10% 20% 30% 40% 50%
Reduced by 11% to 20%
Don't Know/Not Sure
Reduced by more than 20%
Reduced by 1% to 5%
Reduced by 6% to 10%
Initiative Failed to Meet Planned Objectives
Reduced by 11% to 20%
Don't Know/Not Sure
Reduced by more than 20%
Reduced by 1% to 5%
Reduced by 6% to 10%
Initiative Failed to Meet Planned Objectives
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 16
SUMMARY OF 2005 RESPONDENTS
Overall Impact of Supply Chain Initiatives in the Past Year on Revenue
Q16: In the past year, what has been the overall impact of your supply chain initiatives on revenue?
19%
8%
5%
2%
37%
29%
0% 10% 20% 30% 40% 50%
Increased by 11% to 20%
Don't Know/Not Sure
Increased by More than 20%
Increased by 1% to 5%
Increased by 6% to 10%
Initiative Failed to Meet Planned Objectives
Increased by 11% to 20%
Don't Know/Not Sure
Increased by More than 20%
Increased by 1% to 5%
Increased by 6% to 10%
Initiative Failed to Meet Planned Objectives
How Closely is Supply Chain Strategy Linked to Profit and Loss Statement and Balance Sheet?
Q17: How closely is your supply chain strategy linked to the profit and loss statement and balance sheet?
Not at All – 16%
Somewhat – 54%
To a High Degree – 30%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 17
SUMMARY OF 2005 RESPONDENTS
To Whom Does Your Most Senior Supply Chain Executive Report?
Q18: To whom does your organization's most senior supply chain executive report?
CEO – 33%
Other – 7% CFO – 8%
COO – 18%VP/SVP Operations – 33%
Effectiveness of Supply Chain Leadership and IT Leadership Collaboration on Introducing New Technologies to Improve Business Performance
Q19: How effective has your supply chain leadership been in working with IT leadership to introduce new technologies that can improve business performance?
1 = not very effective 5 = very effective
1 – 11%
4 – 24% 2 – 20%
3 – 30%
5 – 15%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 18
SUMMARY OF 2005 RESPONDENTS
Development Areas in the Supply Chain Organization that Need the Most Work
Q20: Which of the following development areas does your supply chain organization need to work on most? (Rank top three only)
0% 20% 40% 60% 80% 100%
1
2
3
Developing a Business Case for RFID Investments
Project Management
Organization
Communications
Understanding New Technologies
Collaboration With Suppliers and Customers
Internal Collaboration
Importing/Exporting
Domestic Versus Global Supply Chain
Customer Service
Planning
Plan Execution
Teamwork
Understanding the Relationship Between Business and Technology
Developing a Business Case for Supply Chain Investments
Developing a Business Case for RFID Investments
Project Management
Organization
Communications
Understanding New Technologies
Collaboration With Suppliers and Customers
Internal Collaboration
Importing/Exporting
Domestic Versus Global Supply Chain
Customer Service
Planning
Plan Execution
Teamwork
Understanding the Relationship Between Business and Technology
Developing a Business Case for Supply Chain Investments
Percent of Importing/Exporting Done in Business
Q21: How much importing/exporting is done as a part of your business?
Less than 5% – 20%
5% to 10% – 15%
Greater than 20% – 46%
11% to 15% – 10%16% to 20% – 11%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 19
SUMMARY OF 2005 RESPONDENTS
Supply Chain Vulnerability Reviews
Q22: What is your response to the following statement: I am concerned that my supply chain is vulnerable because of …
0% 20% 40% 60% 80% 100%
Unstable Global Sourcing Points
New Import or Customs Regulations
Changing European Union Conditions
International Freight Movement
Potential Security Breaches or Terrorist Attacks
Inventory Planning and Inventory Level Strategy
Critical Trading Partner Vulnerabilities
Visibility into Your Trading/Outsourcing Partner Shipments
Other
Unstable Global Sourcing Points
New Import or Customs Regulations
Changing European Union Conditions
International Freight Movement
Potential Security Breaches or Terrorist Attacks
Inventory Planning and Inventory Level Strategy
Critical Trading Partner Vulnerabilities
Visibility into Your Trading/Outsourcing Partner Shipments
Other
Strongly Disagree
Disagree
Neutral
Agree
Strongly Agree
Plans to Initiate Supply Chain Vulnerability Reviews
Q23: Have you or are you planning to initiate supply chain vulnerability review in the following areas?
35%
15%
38%
18%
55%
35%
26%
5%
28%
0% 20% 40% 60%
Visibility into Your Trading/Outsourcing Partner Shipments
Inventory Planning and Inventory Level Strategy
Critical Trading Partner Vulnerabilities
Other
Unstable Global Sourcing Points
New Import or Customs Regulations
Changing European Union Conditions
International Freight Movement
Potential Security Breaches or Terrorist Attacks
Visibility into Your Trading/Outsourcing Partner Shipments
Inventory Planning and Inventory Level Strategy
Critical Trading Partner Vulnerabilities
Other
Unstable Global Sourcing Points
New Import or Customs Regulations
Changing European Union Conditions
International Freight Movement
Potential Security Breaches or Terrorist Attacks
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 20
SUMMARY OF 2005 RESPONDENTS
Presence of a Written Contingency Plan in Case of a Significant Disruption
Q24: Does your supply chain organization have written contingency plans in the case of a significant disruption?
Yes – 38%
Not Sure – 11%
No – 50%
Level of Agreement with Statements
Q25: Please indicate your level of agreement to the following statements.
0% 20% 40% 60% 80% 100%
My organization has the ability to allow key suppliers and customers to view
order status online
My organization has sufficient executive visibility and accountability for supply
chain continuity and protection
My organization pays sufficient attention to supply chain vulnerability measures
and risk mitigation actions
My organization has the ability to allow key suppliers and customers to view
order status online
My organization has sufficient executive visibility and accountability for supply
chain continuity and protection
My organization pays sufficient attention to supply chain vulnerability measures
and risk mitigation actions Strongly Disagree
Disagree
Neutral
Agree
Strongly Agree
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 21
SUMMARY OF 2005 RESPONDENTS
Degree to Which Product Development Strategy is Synchronized with Strategic Sourcing Strategies
Q26: To what degree is your product development strategy synchronized with your strategic sourcing strategies?
Not at All – 24%To a Large Amount – 20%
Somewhat – 56%
Sharing of Standardized Bills of Material with Tier 1 Suppliers and Design Partners
Q27: Do you have a standardized enterprise-wide Bill of Material (BOM) that you share with your tier 1 supply chain and design partners?
74%
26%
0% 20% 40% 60% 80% 100%
No
Yes
No
Yes
Impact of Engineering Change Orders on Supply Chain Partners’ Ability to Respond
Q28: How do engineering change orders impact your supply chain partners' ability to respond to your sourcing needs?
Not at All – 24%To a Large Amount – 20%
Somewhat – 56%
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 22
METHODOLOGY
THE THIRD ANNUAL GLOBAL SURVEY OF SUPPLY CHAIN PROGRESS 23
Methodology
The 2005 Global Survey of Supply Chain Progress was sent to supply chain professionals in North America, Europe, Australia, and selected countries around the world. The names were drawn from CSC’s client base as well as from readers of Supply Chain Management Review and other publications of Reed Business Information.
A total of 120 respondents completed the comprehensive, eight-page questionnaire. The majority of the responses came from North America, mainly the United States. Eighteen industries were represented, ranging from aerospace and defense to retail and consumer packaged goods to high technology and telecommunications. Organizationally, 62 percent of the respondents represented corporate entities; 19 percent were from wholly- owned subsidiaries or strategic business units; and 19 percent were from groups or multiple divisions.
Computer Sciences Corporation
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About CSC Computer Sciences Corporation helps clients achieve strategic goals and profit from the use of information technology.
With the broadest range of capabilities, CSC offers clients the solutions they need to manage complexity, focus on core businesses, collaborate with partners and clients, and improve operations.
CSC makes a special point of understanding its clients and provides experts with real-world experience to work with them. CSC is vendor-independent, delivering solutions that best meet each client’s unique requirements.
For more than 45 years, clients in industries and governments worldwide have trusted CSC with their business process and information systems outsourcing, systems integration and consulting needs.
The company trades on the New York Stock Exchange under the symbol “CSC.”
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