Gartner 2017
Paul Trudgian Ltd | Supply Chain & Logistics Consultancy No Comments

On 21st September 2017, Gartner announced their updated rankings of supply chains, which has seen Unilever, Inditex, and H&M take the gold, silver, and bronze positions. Overall, rankings are given to the top 15 supply chains in Europe, compared to Gartner’s global ranking of supply chains which looks at the top 25.

The Importance of the Gartner Rankings

Gartner, Inc. is a world leading research and advisory company which provides researched insights across a range of areas. They aim to identify best practices in order to enable businesses to develop and grow. The Gartner rankings carry monumental weight in the supply chain industry because of their accuracy, insight, and comprehensive research. They provide insight in to where supply chains are doing well, and where improvements can be made.

The Rankings

The predominant trends which have emerged across the top 15 supply chains in Europe are adaptability, digital experimentation, and a sharp focus on sustainability. The rankings look at a range of different factors and variables including inventory turn, revenue growth and return on assets.

Unilever, taking the top spot of the European list, also took the top sport of Gartner’s Global Supply Chain Ranking earlier this year in May. Unilever took the top spot last year as well.  10 of the companies listed in the European top 15 were in the top global 25. Adidas, Roche, and Siemens all made it on to the list after being absent in 2016. British American Tobacco, Ahold Delhaize, and Bayer all fell off the list after being on it last year.

The Gartner report lists the top 15 supply chains as follows:

  1. Unilever
  2. Inditex
  3. H&M
  4. Nestlé
  5. Nokia
  6. BASF
  7. Schneider Electric
  8. L’Oréal
  9. BMW
  10. Diageo
  11. Reckitt Benckiser
  12. GlaxoSmithKline
  13. Adidas
  14. Roche
  15. Siemens

Announcement of Results

The results were announced at the Gartner Supply Chain Executive Conference held on the 20th and 21st September in London. The Vice President of Gartner, Stan Aronow stated that: “Europe-based supply chains built on their strong performance in 2017… Ten European firms made it into the global top 25, one more than 2016 and five more than 2015”. It’s clear to see the upward trend of the European standing of supply chains.

In addition, Aronow stated that: “The companies in the European top 15 demonstrated strong growth of 6.8%, which is more than double the average growth of the global top 25… Moreover, European companies scored above average in corporate social responsibility and opinion score performance.”

Success

In addition to the primary trends of digital experimentation, speed to adaptability, and a focus on sustainability there are some “core foundational themes” which Gartner explains are common to all of the top ranking supply chain organisations, both in Europe and worldwide. The common themes are broad in nature but have been categorised as follows:

  • Global Scale, Local Responsiveness: Typically, all of the supply chains listed in the rankings are large-scale with a multitude of sites. Each of these chains is comprised of thousands of suppliers, thousands of Stock Keeping Units (SKU’s) and operate across multiple countries. Their targets tend to be clear and challenging as well as being global in scope, but are flexible ‘on-the-ground’ in different local areas according to local needs and dynamics. Typically this is split with a global approach towards strategy, planning, analytics, quality, technology and visibility, but with a locally determined approach towards manufacturing and distribution.
  • Multiple Models Through Segmentation: Leaders of these top ranking supply chains apply segmentation across a range of situations including new product categories, enhancing customer service, handling emerging markets, or shifting to multichannel processes. In this way they create a wide range of ‘template’ models which can be applied elsewhere. This allows them to manage complexity in an effective and efficient manner. The result is that they are exceptional at customer service as well as being efficient.
  • Collaboration: Using the benefits brought to them through technology, of visibility and insight, all of the top ranked companies work in a collaborative manner across every network within their supply chain. They are goal-orientated and this is reflected at many different levels. Internally these companies foster decision-making forums which are cross-functional, seeking the input and collaboration of internal business partners, suppliers, and customers. In addition, they also work with strategic suppliers, and partner with competitors, regulatory bodies, customers, and other parties as required.
  • Investors in Talent and Technology: It’s no surprise that these companies are all keen and prolific investors in both talent and technology. Technology is vital to success within a modern supply chain and these businesses recognise this. However, it also goes hand-in-hand with the very best in talent who are driving the effective use and adoption of technological advances. Typically, university links are a character of their recruitment and talent management.
  • Culture of Excellence and Masters of Change: All of the top ranked businesses see ongoing change and transformation as a continual process of refinement and progression. There is a strong focus on operational excellence which is evidenced in the company culture and they are constantly seeking to improve. They all actively drive the change and development of the supply chain industry, and don’t just keep pace with change but lead it.

The Future

It’s likely that the trends we have seen reflected in the 2017 rankings of supply chains by Gartner will continue along a similar course for the next few years. Collaboration, insightful data, and technology are still headlining matters in the supply chain world. Those companies that embrace the changes rapidly are those which will be most successful.

Therefore, it’s unlikely at the moment that we’ll see a discontinuation of the current trends affecting the ranking, and the top spots will continue to be filled with companies such as Unilever if they continue to be supply chain leaders.

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