Financial performance of the Supply Chain - Conceptual models

There are many ways of measuring performance within the supply chain, but few that focus on the performance of the supply chain as a whole [AG 5 010] .

The difficulty of grasping the concept of the extended supply chain, and especially of managing it, often leads companies to focus on their own performance, losing sight of the fact that their performance is linked to that of the other links in the chain. Another difficulty is the reluctance of players in a global supply chain to share information. As a result, measurements often stop at customers and Tier 1 suppliers, but do not report on the performance of the overall supply chain.

How should the financial performance of a supply chain be measured? Should value creation for the shareholders of the firms involved in the supply chain be assessed separately or collectively? Should we take into account only the capital invested by the company in question, or also that invested by its partners?

Many authors have established a link between supply chain management (SCM) and an organization's financial performance, without actually proving it.

This shows that the difficulty of assessing the effectiveness and efficiency of a supply chain is still very much with us.

The aim of this article is to examine the measurement of financial performance in the global supply chain.

The basics of financial analysis of an organization are covered, followed by an explanation of the global supply chain and how it is managed. This is done in order to link financial performance and the supply chain. Finally, a set of levers for improving the financial performance of a supply chain is proposed. A model for measuring the financial performance of a global supply chain is described, with particular emphasis on its implementation.