Telecommunications technology conglomerate Cisco Systems Inc. has claimed the top spot in an annual ranking of supply chain leaders applying best practices, jumping five slots from its position in 2019, according to a list compiled by the market research firm Gartner Inc.
Gartner’s “2020 Supply Chain Top 25” list comprises scores from companies’ business performance—measured by their public financial and ESG (environmental, social, governance) data—and from an opinion category that gauges their future potential and leadership in the supply chain community. Candidate companies must have annual revenue of $12 billion or more, as derived from a combination of the Fortune Global 500 and the Forbes Global 2000.
This year’s ranking, the 16th edition, was compiled against the backdrop of the unique global business landscape forged by the coronavirus pandemic, Mike Griswold, vice president analyst with the Gartner Supply Chain practice, said in a release. "With substantial amounts of the economy closed due the Covid-19 pandemic, leaders need an agile strategy that allows the supply chain organization to sense and respond to changes in the business context as they happen,” Griswold said. “Our ranking highlights companies that possess these strategies and other differentiating capabilities.”
When all the variables were totalled, Cisco Systems scored the top spot in the ranking, followed by Colgate-Palmolive, Johnson & Johnson, Schneider Electric, and Nestlé. Six new companies joined this year’s list: Lenovo, AbbVie, British American Tobacco, Reckitt Benckiser, Biogen and Kimberly Clark.
"Cisco’s revenue growth, strength in environment, social and corporate governance (ESG) and recognition of leadership in community opinion polls drove the move up from the fifth position in 2019 to the top spot today,” Griswold said. “Its ESG focus includes the circular economy, with the goal of having 100% of new Cisco products incorporate circular design principles by the financial year 2025.”
Among the top 25 companies, Gartner said three key trends separated supply chain leaders from the rest of the pack. The top performers in 2020 are accelerating their capabilities as: business model transformers, digital orchestrators, and purpose-driven organizations.
The business model transformers included companies that could handle dynamic competition sparked by expanded customer expectations, new market entrants from existing industry ecosystems, and the emergence of non-traditional competitors. Leading supply chain organizations thrive in that environment by positioning themselves as disruptors, either through reinvention of their offerings or by acquiring start-ups that offer new expertise, Gartner said.
The digital orchestrators included early and frequent adopters of new technologies. And the purpose-driven organizations have recognized that solving the world’s largest problems only works through partnership with others in the broader community, as well as through their own radical transparency.
“In the time of Covid-19, it has been a marvel to witness the strength and creativity of the supply chain community in keeping our society fed, supplied, and healthy,” Griswold said. “For example, we’ve seen apparel companies manufacturing personal protective equipment and airlines converting dormant warehouses into food processing centers. Those shifts would normally have taken months or quarters to plan and execute. However, purpose-driven supply chain talent managed to shorten these timeframes to a couple of weeks.”