What’s Inside

Most supply chain organizations are evaluated on cost and service. Fewer are evaluated on what matters most to CEOs, CFOs, and investors: shareholder value. Yet supply chain excellence directly influences the three financial pillars that drive economic profit: revenue growth, cost reduction, and working capital. Companies that fail to make that connection are leaving significant value on the table.

In “Driving Shareholder Value with Your Supply Chain,” J. Paul Dittmann and Dan Pellathy of the University of Tennessee Global Supply Chain Institute (GSCI)—with contributing editor Ted Stank—draw on interviews with senior supply chain executives across CPG, food, apparel, consumer durables, and industrial manufacturing, as well as stock analysts and private equity investors, to establish a direct and measurable link between supply chain excellence and long-term shareholder value.

The paper centers on economic profit—less the cost of capital required to generate it—as the lynchpin linking supply chain performance to shareholder value. World-class supply chains drive economic profit by supporting revenue growth through flawless delivery, reducing costs across the extended supply chain, and lowering working capital through better inventory and cash management. Additionally, a detailed case study shows how one Fortune 150 manufacturer used its supply chain to cut its working capital by $1.2 billion, adding $600 million to cash flow without sacrificing customer service.

Because supply chain excellence means different things to different organizations, the paper offers four distinct definitions drawn from leading researchers and analysts, followed by ten concrete best practices for aligning supply chain decision-making with shareholder value. A CEO self-test and a best-practice self-assessment give supply chain leaders a starting point for benchmarking their own organizations.

Download to Explore

• Why economic profit—not cost reduction alone—is the true measure of supply chain excellence
• How supply chains drive shareholder value through cost, cash, growth, and risk management
• A case study: how one Fortune 150 manufacturer added $600 million to cash flow through supply chain transformation
• Four definitions of supply chain excellence from leading researchers and industry analysts
• Ten best practices for aligning supply chain decision-making with shareholder value
• A CEO self-test and best-practice self-assessment to benchmark your organization

Who This White Paper Is For

• Chief Supply Chain Officers and Chief Financial Officers
• Corporate CEOs and Boards of Directors
• Supply Chain Leaders and Senior Executives
• Investment Analysts and Private Equity Professionals
• Supply Chain Professionals and Advanced Students

For more in‑depth, industry‑focused white papers from the Global Supply Chain Institute (GSCI) at the University of Tennessee, Knoxville, visit our white papers library. Recent research produced by the Advanced Supply Chain Collaborative (ASCC) engages industry leaders and UT faculty to explore and report on leading‑edge practices in supply chain management, planning, and innovation.