Unilever ranks highest in Gartner's 2016 Supply Chain Top 25

The research firm Gartner Inc. has released the findings from its annual Supply Chain Top 25, identifying supply chain leaders and highlighting their best practices. Analysts announced the results May 18 at the Gartner Supply Chain Executive Conference in Phoenix, Arizona, USA.

For the first time, Unilever topped the ranking, followed by McDonald's, Amazon, Intel, and a newcomer to the top five, the Swedish fashion retailer H&M. Five new companies made the Supply Chain Top 25 this year, with Schneider Electric, BASF, and BMW joining the list for the first time, and HP and GlaxoSmithKline rejoining after several years. (See below for the full list.)

Some of that movement can be attributed to the addition this year of a corporate social responsibility (CSR) scoring component. The CSR component score assesses each company's commitment to and proficiency in running socially and environmentally responsible supply chains. Points are awarded if companies produce publicly available sustainability reports using accepted standards and if certain expert third parties recognize their exceptional performance in social and environmental responsibility.

In addition to the corporate social responsibility metric, the quantitative part of the Supply Chain Top 25 includes three financial metrics: return on assets (net income/total assets); inventory turns (cost of goods sold/inventory); and revenue growth (change in revenue from prior year). The four components are combined to create a weighted average score. The metrics are supplemented with opinions from a global peer panel and Gartner analysts. More information about the methodology can be found here.

According to Gartner, the results "highlight companies that are not only engaged in supply chain process innovations with exemplary outcomes but that also share what they're doing with the supply chain community at large and provide leadership to others."

Apple and Procter and Gamble (P&G) continued to qualify for the "Masters" category, which applies to companies if their composite score places them in the top five rankings for at least seven out of the past 10 years.

Apple continues to succeed by offering platforms that "ecosystems" of partners build on to meet customers' needs. The big question for Apple and its supply chain is whether it can deliver on the next big innovations to continue the revenue and earnings pace of the last decade, analysts said.

For the majority of its products, P&G is running an end-to-end synchronization program. Every part of the supply chain operates based on the daily cadence of consumption, in some cases triggered by demand at the shelf. The supply chain team brings data and analysis skills to the process with the ultimate goal of increasing the value that each active SKU contributes to the company, Gartner said.

1. Unilever
2. McDonald's
3. Amazon.com
4. Intel
5. H&M
6. Inditex
7. Cisco Systems
8. Samsung Electronics
9. The Coca-Cola Company
10. Nestlé
11. Nike
12. Starbucks
13. Colgate-Palmolive
14. 3M
15. PepsiCo
16. Wal-Mart Stores
17. Hewlett-Packard
18. Schneider Electric
19. L'Oréal
20. BASF
21. Johnson & Johnson
22. BMW
23. GlaxoSmithKline
24. Kimberly-Clark
25. Lenovo

"Masters" category:
Apple
Procter & Gamble