Direct CEO reporting line key to supply chain success

3 October 2007
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04 October 2007 | Paul Snell

Supply chain leaders must report directly to the CEO if they are to achieve the best results.

A study, published yesterday by consultants CSC and Michigan State University, concluded best performance would only be achieved if senior level executives supported supply chains.

"There must be someone in charge with full responsibility for what happens within the supply chain across the extended enterprise," it said. "This senior officer must be a direct report to the CEO and have the full support of the CIO and CFO."

The survey of 179 supply chain professionals across 21 industry sectors, mainly in North America, also found the leading firms make lower supply chain investments than those that perform less well. Best performing firms spend 20 per cent of revenue on improving their supply chains, compared with 29 per cent by the worst performers. "It's not a question of how much is spent on supply chain improvement, but how wisely," the report said.

It also highlighted the increased need for collaboration with other departments. While 24 per cent said the involvement of financial managers in the supply chain was high, almost a third said there was "low to no support".

Just under 40 per cent of firms said they had increased the level of customer focus in their supply chain, with 57 per cent saying they exchanged supply chain information with suppliers and customers.



SMoct2007

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