Supply Chain Management Review

Frank Quinn

Supply Chains the 18% Return
January 11, 2008

Want proof of the direct correlation between supply chain excellence and superior financial performance? AMR Research has it for you.

Every year the research firm does a report on its Top 25 supply chains. It’s an exhaustive piece of research that considers key financial metrics, collective insights from the AMR analysts, and input from a peer review panel of leading supply chain practitioners. Nokia topped the list in 2007, followed closely by Apple and then by a number of perennial leaders like Wal-Mart, P&G, IBM, and Toyota. (See our report in the September 2007 issue  http://www.scmr.com/article/ca6481154.html.)

Earlier this week AMR Research analysts Debra Hofman and Kevin O’Marah revisited the Top 25 list for 2007 to see how well they actually performed that year. What they discovered was nothing short of remarkable: the Top 25 portfolio of companies averaged a total return of 17.89 percent for the year. That compares to 6.43 percent for the Dow Jones Industrial Average and 3.53 percent for the S&P 500.  (See The AMR Research Supply Chain Top 25 Blows Away Market with 17.89% Return.)

Granted, the supply chain is not the sole driver of success in an organization (although we at SCMR are found of claiming that). But the figures from AMR Research make a clear and compelling connection.  I bet your CFO and CEO would love to see this report.

Posted by Frank Quinn on January 11, 2008 | Comments (0)