PROFOUND DISCOVERYPOWERFUL CONNECTIONCLEAR FORESIGHT

2015 ANNUAL REPORT

With the support of the Institute for Supply Management ®, the W. P. Carey School of Business at Arizona State University, and our board members – who have dared us to dream big, have offered us their thought leadership from a range of industries and areas of expertise, and given us support and guidance – we have set the groundwork for growth and transformation.

CAPS Research is well poised moving forward to increase membership numbers and benefits, provide timely and groundbreaking research and responsive benchmarking studies, and offer a growing number of networking events worldwide to create a global community of supply management leaders. We are unwavering in our dedication to consultant-free and sales-free events and resources to allow peer-based exchange of ideas and generation of solutions. We have expanded our scope to new industries and innovations, emerging economies and growing multinationals, and new media channels to increase connectivity.

Yes, there have been economic downshifts in certain industries and countries; however, our membership has held strong, and we are creating tools to empower our companies. We are engaging prospective members, developing lasting relationships and lucrative partnerships, and giving new companies compelling reasons to join us on this journey.

As you have invested in us with your time, interest, membership, and intellectual capital, we encourage you tell us how we can support you in your function and industry. Each step toward the future of supply management enables us in our mission of profound discovery, powerful connection, and clear foresight.

Deb and Tom

Since taking the helm of CAPS Research, we have been setting our sights high and challenging ourselves and our organization to imagine what we can be… to create increasing and incomparable value for our members and lead the advancement of supply management as a profession.

2015:A YEAR OF TRANSFORMATIONLetter from the Executive Directors

Thomas Choi, Ph.D.Executive Director,CAPS ResearchHarold E. Fearon Chair of Purchasing Management

W. P. Carey School of Business, Arizona State University

Deborah K. StantonExecutive Managing DirectorCAPS Research

Under the leadership of Deb Stanton and Tom Choi, the transformation of CAPS Research will allow us to achieve strategic importance in tackling new challenges in the global economy, including financial fluctuations, interconnectedness, and technology that shape the way we all do business. CAPS Research is building the knowledge base to empower us to advance the profession and grow our careers.

This year as chair has been inspiring and educational, and the greatest benefit of this role has been working alongside peers in an open forum toward a common mission. I would like to recognize the efforts of David Hammerle and Timothy Fiore, Executive Committee Members, for their leadership and initiative with the board. I would also like to take the opportunity to thank outgoing board members Vince Messimer (Royal Dutch Shell), Michael Slomke (Honeywell International), David Wohler (Covidien), Jeffrey Wood (Allegion), and Joseph Yacura (Fannie Mae) for their service and commitment.

While CAPS Research has dependably provided procurement executives with key information and excellent networking opportunities, we are now repositioning it on the forefront of the new supply management. There has not been a better time to get involved!

Sincerely, Christie

The Executive Advisory Board plays a crucial role in the evolution of CAPS Research in establishing standards for the nature and quality of information we put out into the world, in understanding the role that the CPO plays in supply management, and in advancing the role that supply management and procurement serve in their organizations’ overall prosperity. This is a big charge, and one that all our board members are prepared to undertake.

SHAPING THE FUTUREOF SUPPLY MANAGEMENTLetter from the board chair

Christine Breves, C.P.M.Chair, Executive Advisory BoardVice President andChief Supply Chain OfficerU.S. Steel

BOARD MEMBERS

Stewart AtkinsonChief Purchasing Officer, Product SupplyProcter & Gamble Company

Jaime Bohnke, Ph.D.Vice President, Global Supply Chain, Chief Procurement OfficerNorthrop Grumman Corporation

Christine Breves, C.P.M.Chair, Executive Advisory BoardVice President andChief Supply Chain OfficerU.S. Steel

Kevin BrownVice President,Chief Procurement OfficerDell Inc.

Daniel CarrellVice President, Global Procurement

IBM

Thomas Choi, Ph.D.Executive Director,CAPS ResearchHarold E. Fearon Chair of Purchasing Management

W. P. Carey School of Business, Arizona State University

Thomas W. DerryChief Executive OfficerInstitute for Supply Management

Harold Fearon, Ph.D., C.P.M.Director EmeritusCAPS Research

Timothy R. Fiore, CPSM, C.P.M.Former Senior Vice President, Supply Management& Chief Procurement OfficerThyssenKrupp

John Fowler, Ph.D.Chair, Supply Chain Management W. P. Carey School of Business, Arizona State University

David HammerleVice Chair, Executive Advisory BoardPrincipal Vice President, Corporate Manager of Procurement and ContractsBechtel Corporation

Amy Hillman, Ph.D.DeanW. P. Carey School of Business, Arizona State University

Vincent J. HrenakVice President, Supply Chain Space & Airborne SystemsRaytheon Space and Airborne Systems

Maria LindenbergChief Procurement OfficerChevron Corporation

Pam McGinnisGeneral Manager & Chief Procurement OfficerPhillips 66

Vince Messimer Vice President, Contracting & ProcurementRoyal Dutch Shell plc

Carl F. OberlandVice President, ProcurementSiemens Industry, Inc.

Kevin PetrieChief Supply Chain Officer Nestlé USA

Michael E. Slomke, C.P.M. Vice President &Chief Procurement OfficerHoneywell International Inc.

Colleen SoukupVice President, Worldwide SourcingGeneral Mills, Inc.

Deborah K. StantonExecutive Managing DirectorCAPS Research

Shelley Stewart, Jr.Vice President &Chief Procurement OfficerDuPont

Jacklyn A. SturmVice President & GM,Global Sourcing & ProcurementIntel Corporation

David E. Wohler, C.P.M. Vice President, Global SourcingCovidien

Jeffrey M. Wood Vice President,Global Supply ManagementAllegion

BENCHMARKING CAPS Research offers strategic and timely benchmarking data so member companies can compare and evaluate their supply management practices, processes, and performance against peer companies inside and across industries. We collect unbiased data from member companies, as well as non-members, and group them in a logical, actionable way. In 2015, we released 24 surveys and created 174 reports, sourced from nearly 1,000 suppliers and more than 1,000 sourcing and procurement professionals.

Our capable team works on a very personal basis with our member companies to provide the short-term studies with immediate results and useable implications. In addition to being a prime resource for our member companies, we have opened a Benchmarking Subscriber level membership that allows us to provide a broader data set to include approved up-and-coming organizations and also establish relationships with them as they grow.

MEMBER COMPANY NETWORKING One of the greatest advantages of CAPS Research membership is networking events that facilitate meeting with peers in a strictly sales-free environment. Leaders in procurement from global companies of similar size and scope can openly discuss challenges, strategies, and personal insights into supply management issues facing their companies.

In 2015, we hosted six topic-specific Critical Issue Exchange events throughout the US and one in Asia, and we held our multi-day CPO Executive Roundtable, Best Practices Workshop, and Asia Executive Roundtable. CAPS Research has also assembled a number of Industry Advisory Groups (IAGs) that gather procurement and supply professionals in small, interactive meetings to focus on issues specific to their respective industries. The Utilities IAG met in October 2014 and Aerospace & Defense in March 2015 to address benchmarking surveys, discuss best practices and critical issues, and network with peers.

RESEARCHCAPS Research is committed to providing leading, in-depth publications that are timely and impactful. In 2015, we began five separate projects: cloud-based services outsourcing, supply chain financing, the nexus supplier index, optimizing services outsourcing triads, and a futures survey. Expert researchers recruited for these studies hailed from Arizona State University, Michigan State University, University of Notre Dame, and Rutgers University. The early concepts of the Nexus Supplier Index were published in the Harvard Business Review: “Hidden Suppliers Can Make or Break Your Operations,” May 29, 2015.

Also, in 2015 the Health Sector Research Consortium (HSRC), begun under the leadership of Eugene Schneller, was integratedinto CAPS Research as an Industry Advisory Group, to represent research interests of the health sector. The group includes distributors, manufacturers of health care supplies, group purchasing organizations, health information technology providers, and hospitals.

Now as part of CAPS Research, former ASU-HSRC members enjoy enhanced benefits and cross-industry resources, and CAPS Research welcomed all its members in the health sector to participate in the CAPS-HSRC. They will develop actionable research to help reduce risk, lower cost, influence policy, and accelerate the performance of the health sector supply chain.

CAPS RESEARCH MEMBERSHIP CAPS Research is grateful for the investment that each member company has made, enabling us to provide practitioner-focused research and benchmarking, and networking events without commercial bias, in a way that is effective and powerful for an elite group of companies. Member companies contributing $25,000 (Platinum Corporate level) or $15,000 (Corporate level) annually are ensured access to all research through our website, and receive invitations to participate in the Executive Roundtables, Best Practices Workshops, and Critical Issue Exchange events. Members are also invited to co-host Critical Issue Exchange events with CAPS Research in the areas of their specialty and interest.

PLATINUM CORPORATE: $25,000

We are especially appreciative of our Platinum members, who partner with us to strengthen our mission and support the advancement of our field. We benefit not only from their commitment, but also from their supply management expertise. CAPS Research provides Platinum members with complimentary seats at our premier multi-day events: the CPO Executive Roundtable for Chief Procurement Officers, and the Best Practices Workshop for Directors.

Chevron Corporation Novo Nordisk, Inc.Pacific Gas and Electric CompanyRaytheon CompanyRoyal Dutch Shell plcTeradyne

CORPORATE: $15,000

The generous commitment of our member companies in the 2015 fiscal year provided for full access to all our research studies, benchmarking services, and participation in the multi-day Executive Roundtables, Best Practices Workshops, and Critical Issues events.

3M Company

AbbVie, Inc.

Agilent Technologies, Inc.

Allegion

American Electric Power Company, Inc.

American Water Works Company, Inc.

Apache Corporation

APL Logistics, Ltd.

ArcelorMittal Dofasco Inc.

Arizona Public Service Company

AT&T Services, Inc.

B/E Aerospace, Inc.

BAE Systems

BBVA

Bechtel Corporation

BHP Billiton

Boehringer Ingelheim

Boeing Company

Bonneville Power Administration

BP America Inc.

Bristol-Myers Squibb Company

CB&I Constructors, Inc.

Celanese Corporation

Cessna Aircraft Company/Textron, Inc.

Chesapeake Energy Corporation

Chevron Phillips Chemical

Company LP

Colfax Corporation

ConocoPhillips

CONSOL Energy Inc.

Covidien

Cummins Inc.

Deere & Company

Dell Inc.

Diebold, Incorporated

Dominion Resources Services, Inc.

Dräger Medical Systems, Inc.

Dresser-Rand Group Inc.

DTE Energy

Duke Energy Corporation

DuPont

Eaton

Elbit Systems of America

Emerson Process Management

Eni S.p.A.

ExxonMobil Global Services Company

Fannie Mae

FedEx

Fluor Corporation

Freddie Mac

Freeport-McMoRan Copper & Gold Inc.

General Dynamics Corporation

General Mills, Inc.

General Motors Company

Hitachi America, Ltd.

HollyFrontier Corporation

Honda North America, Inc.

Honeywell International, Inc.

Huawei Technologies Co., Ltd.

IBM

Intel Corporation

Irving Oil Limited

Kerry Group plc

L-3 Communications

LG Electronics Inc.

Lincoln Financial Group

Lockheed Martin Corporation

Maersk Olie og Gas

Marathon Petroleum Company

MasterCard Worldwide

Medtronic, Inc.

Mosaic Company

NAV CANADA

Nestlé USA

Nexen Energy, ULC

Nilfisk-Advance, Inc.

NiSource Corporate Services

Northrop Grumman Corporation

NRG Energy, Inc.

Parker Aerospace

Petrobras/Petroleo Brasileiro S.A.

Pfizer, Inc.

Phillips 66

Plains All American Pipeline, L.P.

PNM Resources, Inc.

PPL Corporation

Premier Health Partners, Inc.

Procter & Gamble Company

Rolls-Royce

Royal Philips Electronics

Ryder System, Inc.

Salt River Project (SRP)

Schneider Electric North America

Siemens Industry, Inc.

Sime Darby Berhad

Sinopec Group, the Procurement

Division

Sonoco Products Company

Statoil ASA

Teva Pharmaceuticals

Texas Instruments Incorporated

ThyssenKrupp NA

Toyota Industries North America

TransCanada Pipelines Ltd.

UnitedHealth Group

U.S. Postal Service

U.S. Steel

Vale S.A.

Verizon Communications

Wipro

Xcel Energy Inc.

BENCHMARKINGSUBSCRIBERS

We thank the following organizations that subscribed to benchmarking or participated significantly in benchmarking projects in 2015.

Alyeska Pipeline Service Company

CNS Pantex

U.S. Department of Energy

Douglas Dynamics LLC

Horizon Blue Cross Blue Shield of New Jersey

International Aerospace Quality Group

Investment Recovery Association

Mallinckrodt LLC

Remy International, Inc.

Texas Industries, Inc.

TPI, Inc.

Vectren Corporation

CORPORATE: $15,000

SUMMARY OF FINANCIALINFORMATIONStatements of Financial Positioned Years Ended August 31, 2015 and 2014*

2015 2014Current Assets

Cash $200 $200

Money market investments& funds at ASU $1,845,345 $1,818,465

Accounts receivable $17,500 $50,700

Prepaid expenses $61,031 $13,689

Total current assets $1,924,083 $1,883,054

Property and equipment, net $69,337 $64,330

TOTAL ASSETS $1,993,420 $1,947,384

Current Liabilities

Total current liabilities $193,077 $128,246

Net assets $1,800,343 $1,819,138

TOTAL LIABILTIES AND NET ASSETS $1,993,420 $1,947,384

Statements of Activities and Changes in Net Assets Years Ended August 31, 2015 and 2014*

2015 % of 2014 % of Rev/Exp Rev/Exp

Support and Revenue

Contributions $1,569,140 92% $1,690,434 93%

ISM cash contributions 0 0% 0 0%

Event revenue $136,441 8% $132,450 7%

Investment income 0 0% 0 0%

TOTAL LIABILTIES AND NET ASSETS $1,993,420 100% $1,947,384 100%

Expenses

Research, benchmarking, & events $1,217,898 71% $1,225,280 68%

Business development $294,146 17% $298,810 17%

Administrative & operations $212,333 12% $278,985 15%

TOTAL EXPENSES $1,724,376 100% $1,803,075 100%

Changes on net assets -$18,795.36 $19,809

Net assets, beginning of the year $1,819,138 $1,799,329

NET ASSETS, END OF YEAR $1,800,343 $1,819,138

* The balances include funds held by Arizona State University that are not included in thecombined financial statements of the Institute for Supply Management®

SUMMARY OF FINANCIALINFORMATIONStatements of Financial Positioned Years Ended August 31, 2015 and 2014*

2015 2014Current Assets

Cash $200 $200

Money market investments& funds at ASU $1,845,345 $1,818,465

Accounts receivable $17,500 $50,700

Prepaid expenses $61,031 $13,689

Total current assets $1,924,083 $1,883,054

Property and equipment, net $69,337 $64,330

TOTAL ASSETS $1,993,420 $1,947,384

Current Liabilities

Total current liabilities $193,077 $128,246

Net assets $1,800,343 $1,819,138

TOTAL LIABILTIES AND NET ASSETS $1,993,420 $1,947,384

Statements of Activities and Changes in Net Assets Years Ended August 31, 2015 and 2014*

2015 % of 2014 % of Rev/Exp Rev/Exp

Support and Revenue

Contributions $1,569,140 92% $1,690,434 93%

ISM cash contributions 0 0% 0 0%

Event revenue $136,441 8% $132,450 7%

Investment income 0 0% 0 0%

TOTAL LIABILTIES AND NET ASSETS $1,993,420 100% $1,947,384 100%

Expenses

Research, benchmarking, & events $1,217,898 71% $1,225,280 68%

Business development $294,146 17% $298,810 17%

Administrative & operations $212,333 12% $278,985 15%

TOTAL EXPENSES $1,724,376 100% $1,803,075 100%

Changes on net assets -$18,795.36 $19,809

Net assets, beginning of the year $1,819,138 $1,799,329

NET ASSETS, END OF YEAR $1,800,343 $1,819,138

* The balances include funds held by Arizona State University that are not included in thecombined financial statements of the Institute for Supply Management®

CAPS Research logo

Not for profit. For possibility.

Contact us: 2055 E. Centennial CircleTempe, Arizona 85283480.752.2277480.491.7885www.capsresearch.org

FooterCAPS Research empowers supply chain professionals with profound discovery, powerfulconnection, and clear foresight. We provide strategic insight to top global organizations through research, benchmarking and member company networking. CAPS Research is a non-profit organization founded in 1986, jointly sponsored by Fortune 500 member companies, the W. P. Carey School of Business at Arizona State University, and the Institute for Supply Management® (ISM®). Measure up and move forward with capsresearch.org.

[WP Carey logo] [ ISM logo]

Not for profit. For possibility.

CAPS Research empowers supply chain professionals with profound discovery, powerful connection, and clear foresight.

We provide strategic insight to top global organizations through research, benchmarking and member company networking.

CAPS Research is a non-profit organization founded in 1986, jointly sponsored by Fortune 500 member companies, the

W. P. Carey School of Business at Arizona State University, and the Institute for Supply Management® (ISM®).

Measure up and move forward with capsresearch.org.

2055 East Centennial Circle • Tempe, Arizona 85284-1802p 480.752.2277 • f 480.491.7885

www.capsresearch.org