AMR announces Supply Chain Ranking 2010

Gartner just announced the 2010 Supply Chain ranking conducted by AMR Research.
The ranking consists of the 25 companies with the best-ranked Supply Chains.

Ranking

This years Top 5 (extract):

1. Apple
2. Procter & Gamble
3. Cisco Systems
4. Wal-Mart Stores
5. Dell

Methodology

The following factors are included in the ranking and make up the overall score.

• Peer Opinion / 154 voters (25%)
• AMR Research Opinion / 27 voters (25%)
• 3-yr weighted ROA (25%)
• Inventory Turns (15%)
• 3-yr weighted Revenue Growth (10%)

So there are three factor categories: subjective expert opinion, one supply chain number (inventory turns) and two primarily financial figures.

Methodology / Conclusion

There exists research supporting a correlation between supply chain performance and financial performance of a company, but up to now I have not found papers suggesting that the opposite is true as well. So I doubt that Revenue Growth and Weighted ROA are good indicators to appreciate supply chain performance.

Inventory turns on the other hand is probably very depend on the industry and product in focus and should be used with care.

The last factor is the expert opinion which contributes to the overall ranking. The expert ranking is split into the Peer Opinion and the AMR Research ranking. It is noteworthy, that the weights of both opinions are the same, even though there are five times more Peer Opinion experts than AMR experts indicating, that the AMR experts should be five times as knowledgeable than the other supply chain professionals.

From a business point of view the ranking show companies which have performed above average for a sustained period of time and their example could be used as a blueprint for Supply Chain Design.