Supply Chain Maturity Monitor (SCM2)

This on line Supply Chain Maturity Monitor (SCM2) has been developed by eKNOWtion to enable organizations to assess their current-state position in pursuit of "Next Generation" supply chain reliability, responsiveness and flexibility.

Your responses to the following questions will be held completely confidential. Individual responses will be shared with the respondent only in the workshop environment or as otherwise agreed by you as a client company of eKNOWtion.

It is important that you answer each question to establish a comprehensive supply chain maturity score. This baseline measurement will enhance the value of the workshop and to you as an individual. Select ONLY one response only for each question. There is always the possibility that you will recognize your company between levels or partially at multiple levels. Choose the level that most closely represents the characteristics of your organization, selecting the lower of the levels if you do not completely satisfy the higher level.

Enjoy the survey process. We look forward to working with you to accelerate your supply chain's maturity.



* 1. Name
 
* 2. Email address
 
  3. Company
 
  4. What industry do you work in?
   
   
   
   
 
* 5. What percentage of your supply chain (within your business unit) is (Please select the supply chains (Make-to-Stock, Make-to-Order and/or Engineer-to-Order) in your business unit and enter the percentage of orders fulfilled for each)
Make-to-Stock: Products that are produced to a forecast or plan.
Make-to-Order: Products for which production starts only after a customer order is received.
Engineer-to-Order: Products that involved concurrent design activity with the customer before starting production.
 
 
 
 
PLAN
* 6. Plan Strategy (Overall Supply Chain)

Level 1 PLAN strategy is based on building 'departmental' or 'functional' supply chain plans, which are rationalized and/or aggregated. They may be adjusted (upwards or downwards) based on financial plan. NPI plans are integrated informally.

Level 2 A formal Sales and Operational Planning (S&OP) process involves operations, marketing, sales, product development and finance and is performed minimally monthly and re-examined on an event-driven basis. NPI is formally integrated.

Level 3 Strategic customers and suppliers formally provide critical planning input and Joint Service Agreements are in place which define specific R&R's, metrics, and guidelines for issue resolution and forward planning for key initiatives. Collaborative Planning Forecasting and Replenishment (CPFR) or similar techniques are used for all aspects of planning, forecasting and replenishment.

Level 4 Strategic customers and suppliers provide long-range development/implementation roadmap (including technology) and quantitative end-to-end KPI targets are integrated into plans and budgets.

Level 5 Complete end-to-end transparency of all supply chain (including customers and suppliers) plans for every participant in the supply chain for strategic, tactical and operational plans. Targets are mutually established and reviewed.
   
   
   
 
* 7. Demand (Requirements) Planning

Level 1 Demand forecasts are generated unilaterally by a single business function once a month (or less) using a relatively informal process.

Level 2 Demand planning processes are cross-functionally integrated and reconciled/aligned with marketing and financial objectives. Forecast is developed with direct input from sales and marketing, aggregated across entire organization and rationalized against historical demand data using automated forecasting tools. Customer input is limited to some sharing of forecast data, which may not be consistent in timeliness or format.

Level 3 Relationship or Program Managers for key customer partnerships are in place. Customer generated forecasts (or scheduled orders for an MTO environment) are directly incorporated into the demand planning process and automated forecasting tools aggregate and analyze demand data from internal and external sources setting priorities against pre-defined segmentation/prioritization rules where constraints exist.

Level 4 Collaboratively developed demand forecast information enabled by common data definitions, planning calendars, and product descriptors (e.g. CPFR) flows freely and regularly between customer and supplier via an automated process. Manual processes are limited.

Level 5 Minimal use of forecast, actual point of sale (POS) demand data is used to drive production throughout the supply chain. Complete sharing of demand information across all participants in the supply chain on a real-time basis.
   
   
   
 
* 8. Supply (Resources) Planning

Level 1 Supply planning is conducted within a division/plant or Business Unit and considers some, but not all potential supply constraints (e.g., raw material, labour, equipment availability, test capabilities).

Level 2 Supply planning processes are developed internally considering all potential supply constraints using tools (e.g., APS and ERP) with little or no supplier involvement other than consideration of standard lead times.

Level 3 Supply planning process includes proactive communication with suppliers and considers their input (supply availability and constraints). Supply info is documented and consistently followed using tools which are integrated across external SC partners.

Level 4 Supply plans are developed collaboratively with suppliers using enablers such as public and private SC networks/exchanges (if applicable) and are flexible to accommodate changes in the short-term and for extended supply plans.

Level 5 Supply plans are reviewed and adjusted at a regular basis to consider any day-to-day operational issues that might affect delivery dates. Supply plans are optimized to maximize asset utilization. Seamless execution between internal and external (e.g. Outsourced) supply options are utilised to meet demand.
   
   
   
 
* 9. Plan Execution (Demand/Supply Balancing)

Level 1 Senior management team or individual Business Unit (BU) managers make final decisions overriding existing plans.

Level 2 Plans are managed by a cross-functional team, process is well communicated internally with clearly defined exceptions and actions but customer and supplier awareness is limited. Demand and supply plans are reconciled before committing to a production plan. Imbalances are prioritized in subsequent planning periods, using demand/supply balancing information systems.

Level 3 Specific requirements for demand/supply balancing are developed with input from "key" suppliers and customers using systems integrated with partners' information systems. Plans that violate business rules are addressed cross-functionally considering multiple business impacts (e.g., revenue, cost, quality, service).

Level 4 Supply Chain Planning systems are integrated with demand/supply data sources through public and private supply chain networks/exchanges and enable simulation and "what-if" analysis. Available-to-Promise (ATP) capabilities are automated and can easily secure/allocate necessary resources (if required).

Level 5 Advanced Supply Chain design and optmization algorithms/tools are used to achieve supply/demand balance considering all external constraints throughout the supply chain. Strategic tradeoffs occur to maximize customer satisfaction and minimize total supply chain cost.
   
   
   
 
* 10. Plan Enablement and Control

Level 1 Tools are limited and are typically spread sheet-based and used to facilitate planning with limited measurements. Business rules are used in practice but are not thoroughly documented.

Level 2 Automatic forecasting tools (e.g. APS) are used but with limited supplier/customer input or visibility. Business rules are used in practice and are documented (e.g. Prioritization and Escalation).

Level 3 Customer and Product policies are established and used in the Demand/Supply Balancing process. KPI targets are set based on these policies. APS or other advanced planning tools are used to support demand planning, supply planning and the Demand/Supply Balancing (S&OP) activity. Outputs of the process are communicated throughout the organization and to all contributing supply chain partners.

Level 4 Dashboard performance is easily and readily available for all supply chain partners. SC visibility tools are used to provide quick access to performance details at multiple levels.

Level 5 Supply chain partners assess the impacts of their own performance on the overall SC and recommend/make pro-active changes to enhance.
   
   
   
 
SOURCE
* 11. Source Strategy

Level 1 Sourcing strategy primarily determined and executed at local plant or division level, using existing suppliers rather than comprehensive analysis of potential global supply base. Effectiveness is primarily judged by adherence to budget and realized purchase price variance.

Level 2 Sourcing decisions involve cross-functional teams (e.g., procurement, development, production), strategy is designed to achieve lowest "total landed cost". Negotiated prices reflect consolidated enterprise-wide spend based on buying power.

Level 3 Sourcing strategies are based on overall supplier competencies involving cross-functional teams with specific commodity expertise to achieve the lowest "Total Supply Chain Cost". Process for selecting non-strategic suppliers includes electronic RFQ and bidding practices (where applicable).

Level 4 Formal strategic sourcing process continuously analyzes and rationalizes the supply base which is automatically monitored and compared to established targets to maximize the derived value over the product life cycle. Globalization versus localization decisions are taken based on total supply chain cost impacts.

Level 5 Supply base is updated and expanded/rationalised regularly to include the most current information about cost, quality, responsiveness and reliability and tracked in supplier scorecards which are available as required with complete transparency.
   
   
   
 
* 12. Source Execution

Level 1 Majority of buyer's time spent on purchase order placement (transactional) and following up on existing orders often via fax, mail and phone.

Level 2 Sourcing processes are cross-functionally integrated but include little or no supplier involvement with majority of indirect material purchases using procurement cards, online catalogues or other tools. "ABC" classification is used to prioritize procurement with "B" & "C" parts being sourced using blanket orders, VMI, and/or demand-pull signals.

Level 3 Sourcing process formally integrated with suppliers via electronic links that automate business processes (e.g., electronic PO's, confirmations, pull signals, Advanced Shipping Notifications, invoices) following cross-functional Engineering Change Notification (ECN) processes. Vendor delivery directly to point-of-use is incorporated and bar coding and/or RFID is used for tracking purposes (where applicable).

Level 4 Real-time collaborative sourcing processes and supplier product quality feedback are electronically enabled. All transactions are automated and real-time supplier information can be accessed if needed to support optimization.

Level 5 Sourcing plans can immediately be changed for any level of change in production requirements. Suppliers are also measured on the upside production capability they can help to enable. Suppliers can assess the needs in supply through full access to Make/Deliver information and status is available to them electronically and in real-time.
   
   
   
 
* 13. Supplier Development/Management

Level 1 Comparative analysis of supplier performance is not available and suppliers are not segmented according to strategic importance - the same level of supplier management is applied across the entire supply base.

Level 2 Structured supplier development and relationship management processes are in place (including Quarterly Business Reviews with key suppliers) to reflect cross-functional requirements for buyer/supplier communication using commodity strategies. Supplier scorecards and certification programs are used and comparative analysis of actual supplier performance is used in most sourcing decisions.

Level 3 Standardized supplier scorecards have been co-developed for collaboration with key suppliers and strategic partners and are evaluated on their sourcing improvement strategies along with their performance expectations and all is documented in Joint Service Agreements (JSA's). Quick decisive action is taken on actual performance that does not meet the targets set including the removal of a supplier from an Approved Vendor List (AVL).

Level 4 Strategic supply chain partners participate in a highly collaborative processes from supplier selection, development, management and commodity rationalization. Their performance is managed and shared electronically to ensure continuous supplier quality improvement.

Level 5 Supplier selection is automated and optimized to consider factors such as reliability and responsiveness and not just cost and quality to compare suppliers. Six Sigma is used throughout the sourcing process to determine if a supplier is part of a 'root-cause'.
   
   
   
 
* 14. Source Enablement and Control

Level 1 Specific responsibility for key sourcing activities, such as cost reduction, ongoing performance management, and day-to-day communication is not clearly defined and data needed for day-to-day procurement activities is not easily accessible.

Level 2 Cross-functionally staffed commodity management teams are in place and meet regularly. Procurement is fully integrated with other SC activities via an ERP system and data needed for day-to-day procurement activities is reliable and easily accessible. Customized reports are easy to access and can be adjusted to meet commodity manager's needs.

Level 3 Relationship Managers for key supplier partnerships are in place and they direct a cross-functional team. Strategic suppliers have electronic access to selected information such as demand forecast, inventory levels, production schedules, pending ECO's and performance scorecards.

Level 4 Cross-enterprise integration and electronic exchange environments enable real-time access to necessary planning, procurement and performance data for most suppliers.

Level 5 Free flow of information exists in both directions (company to supplier and back) and alert mechanisms highlight any change in requirements. Automated pro-active alert messaging is in use to address any exceptions. Plan for Every Part (PFEP) information is available for all sourcing decisions.
   
   
   
 
MAKE
* 15. Manufacturing/Production Strategy

Level 1 Manufacturing strategy is predominantly defined to optimize manufacturing performance but perhaps not to meet market requirements and is reactive with constantly shifting priorities based on "hot order" mentality. Focus is on "fire fighting" and not "fire prevention".

Level 2 Manufacturing is demand driven with Make-To-Order as the predominant strategy using Package/configure-to-order or postponement techniques for short lead time or low-volume needs as applicable. If manufacturing is not considered a core competency, outsourcing is used where target costs and quality can be obtained.

Level 3 Demand-pull mechanisms are pervasive and control majority of manufacturing activities. Sub-assemblies or intermediate products are built to forecast. Contract manufacturing (subcontracting) is also used to maintain flexibility and gain additional capacity (where applicable).

Level 4 Suppliers, customers, engineering, and manufacturing collaborate from the initial phases of product life cycle enabling Design for Manufacturability (DFM) as well as Design for Supply Chain (DFSC). Demand-pull mechanisms and mass customization techniques are used on almost all products to be configured or produced-to-order.

Level 5 Product design is modular and flexible, includes use of substitute products and alternate BOMs, postponement strategy is used extensively. Plan for Every Part (PFEP) information is available for all MAKE-based decisions. Lean and six sigma strategies are prevalent.
   
   
   
 
* 16. Production Scheduling and Execution

Level 1 Data inaccuracies or untimeliness make automated MRP/MPS planning tools difficult to use and customer order priorities are not readily available to those scheduling the production floor. Production schedule achievement is either not measured or performance is poor.

Level 2 Production planning processes are cross-functionally integrated incorporating internal production capacity but include little or no supplier or customer involvement. Sales and Operations negotiate and agree to reasonable limits of short-term flexibility and schedule development reflects current plant status (e.g., equipment availability & capability, other jobs and resource availability on production line), change over costs, and preventative maintenance schedules.

Level 3 Production status monitoring ensures that disruptions and opportunities in production are quickly and accurately communicated and advanced constraint-based scheduling systems resolve and present demand/supply conflicts automatically by considering pre-defined business rules.

Level 4 Advanced scheduling systems are linked to strategic customer and supplier systems to enable instantaneous transfer of changes in production requirements, schedule, status and constraints.

Level 5 Customer and product priorities are understood well at the shop floor and factory schedules are adaptive to changing requirements thus can be modified daily and are synchronized with demand to ensure highest possible level of customer satisfaction at the lowest possible cost.
   
   
   
 
* 17. Material Issue, Move & Tracking

Level 1 Raw materials are transacted to WIP inventory upon release or start of production orders and products are tracked through each process for non-essential reasons related to inventory control or cost accounting.

Level 2 Backflushing or other tracking mechanisms are employed where appropriate to automatically record material usage/consumption. Demand-pull mechanisms are used and inventory is classified and actively managed by age and category.

Level 3 Real-time inventory visibility is in place, manufacturing cycle time and WIP have been optimized through Lean Manufacturing techniques and Point-of-Use stock for selected materials is regularly reviewed and maintained.

Level 4 Perpetual polling of in-process production drives electronic pull signals across extended/external enterprises to the originating point of supply and backflushing completion is automated using bar-coding, process-monitoring systems or RFID as appropriate.

Level 5 Multi-tier inventory replenishment rules are defined based on customer and product priorities. Manufacturing strategies are integrated and consistently adjusted to ensure lowest possible total supply chain cost throughout the changing product life cycle.
   
   
   
 
* 18. Manufacturing Enablement and Control

Level 1 Product quality data and process documentation are manually captured by production order on hardcopy forms.

Level 2 Statistical process control techniques are established and product quality and history data and process documentation is electronically available and controlled with visual examples.

Level 3 Real-time process control systems are used and manufacturing processes stop automatically upon a predetermined number of occurrences. Automatic download of production instructions is available and each down-stream operation is capable of assessing quality of an up-stream operation to minimize operator or process induced errors.

Level 4 Product quality data is captured electronically in real-time with on-line Statistical Process Control allowing dynamic evaluation of product quality. Supplier lot quality performance is managed and shared with suppliers electronically in real-time. Paperless Electronic Data Management exists for SPC, process capability, graphical display of work instructions, component specifications and process requirements.

Level 5 Zero defect and no rework manufacturing. Lean Manufacturing (including visual controls) are prevalent.
   
   
   
 
DELIVER
* 19. Deliver Strategy

Level 1 No clear rules governing the prioritization of customer orders and no formal standards for managing delivery performance. Changes to the design of the physical supply chain are reactive.

Level 2 Outbound logistics processes and associated responsibilities for maintaining existing customer orders including configuration management and pricing and order scheduling rules are documented. ERP system enables clear visibility of order status to all necessary functions and tools such as cost modelling and network analysis are used to identify opportunities for improved delivery.

Level 3 Joint Service Agreements document mutual exceptions. Desired service levels and escalation procedures between company and its key customers are well-integrated. Data maintenance procedures and electronically enabled reporting ensure product configuration and pricing data is accurate. Inputs from external sources are key inputs into supply chain network design.

Level 4 Distribution partners are fully integrated with electronic transaction and inventory tracking information; product and order data can be queried by appropriate supply chain partners. E-Commerce is used extensively and elements of distribution network that are strategically outsourced act and look like they are part of the company.

Level 5 Distribution partners are also made aware of customer priorities and alternative strategy is in place to counter unforeseen disruptions in delivery.All delivery status information is electronically sent to close the fulfilment loop.
   
   
   
 
* 20. Order Management

Level 1Data needed to enter and schedule customer orders is not readily available and there is no capability to reserve inventory and key elements of order entry process, such as order confirmation, or credit and price checking, are done manually.

Level 2 Rules and processes for order entry and scheduling are clearly communicated internally and quoting procedures, lead times, and service level targets are used to create delivery quotes, ensuring consistent performance levels. Order commitments can be made using Available To Promise (ATP) logic. Delivery dates for products not in stock can be determined from supply plan, customer allocations are managed manually and automatic credit and price checking is available.

Level 3 Order entry and scheduling are clearly communicated to and understood by customers, order rules are consistent with differentiated service levels for customer and product classes and electronic order methods are available to major customers and order configuration, commit date and status is automated and visible to them.

Level 4 Committed delivery dates are available at time of order, real-time Available-to-Promise (ATP)/Capable-to-Promise (CTP) can be calculated and differentiated pricing and product availability is available electronically.

Level 5 Order promising mechanisms are tracked regularly and continuously updated to improve their accuracy. Steps are taken to improve order status visibility across the network.
   
   
   
 
* 21. Warehousing, Transportation & Delivery

Level 1 Products are shipped when available with no verification of it arriving at the customer without using any processes like order consolidation.

Level 2 Warehousing, transportation, and delivery rules developed internally and warehouse layout is optimized for picking efficiency, minimizing handling of high volume items. Completed products staged for shipping based on FIFO, backlog is minimized with "clean floor at end of day" policy and verification of delivery at customer done manually by checking Proof of Deliveries against orders. Carrier selection and evaluation done by least cost.

Level 3 Warehousing, transportation, and delivery rules developed with direct input from customers and automated product identification and tracking linked to systems that manage dynamic location assignment and shipping and verifies customer receipt and monitoring systems ensure disruptions are immediately visible and acted upon. Carriers are selected and rates determined on consolidated transportation needs of multiple plants, Distribution Centers(DC’s) and BUs.

Level 4 Automatic consolidation of orders (where applicable), shipment routing is optimized to minimize freight costs based on continuous movement and consolidation.

Level 5 Order shipment accuracy is maintained and tracked. Carriers are evaluated for responsiveness and reliability and not just cost.
   
   
   
 
* 22. Deliver Enablement and Control

Level 1 Paper invoice, manual credit control and statement generation are predominant, variety of payment collection processes exist, not standardized across business.

Level 2Invoicing and cash collections rule are developed internally and are generated upon confirmed shipment or delivery with automated statements generated monthly. Credit control managed automatically and payment collection procedures are standardized.

Level 3 Invoicing and cash collection rules are developed with customer input and differentiated by customer category. Customer receipt information and delinquent accounts visible to accounts receivable in real-time. Electronic fund transfers and electronic invoices used wherever possible.

Level 4 Customer receipt automatically triggers payment cycle and accounts receivable uses self-billing with strategic customers. Customer receipt automatically triggers payment cycle and accounts receivable uses self-billing with strategic customers.
   
   
 
 
RETURN
* 23. Return Strategy, Execution, Enablement and Control

Level 1 Returns are managed on a reactive basis and a returns strategy does not exist.

Level 2 Return strategy is defined and sourcing and deliver returns have an established process internally for execution, response and tracking.

Level 3 Returns are pre-established via rules within JSA's for both customers and suppliers with set targets and performance measured. Rework cost is isolated, defined and minimized.

Level 4 On-line capabilities provide access to returns status. RMA's can be issued quickly.

Level 5 Source returns are used as input to sourcing strategy. Deliver returns are used as input to Make/Deliver strategies. Access to these figures is made available for all applicable supply chain partners to view.
   
   
   
 
OVERALL
* 24. Supply Chain Strategy

Level 1 Governance and financial controls for supply chain processes and information systems are based on individual functional strategies and budgets using discrete information systems.

Level 2 Main drivers of supply chain complexity are identified and considered in supply chain design. Governance of supply chain processes and information systems is driven across functions by Supply Chain Strategy and overall Business Strategy and processes. Supply Chain Strategy and enabling information systems roadmap is developed with limited supplier or customer input.

Level 3 Supply chain complexity drivers measured on ongoing basis and integrated with KPIs. Governance of supply chain processes and information systems is driven by Supply Chain Strategy including requirements from key suppliers and customers. Consensus on organization's core competencies but not all are in place

Level 4 Supply chain complexity implications of decisions relative to other business processes is understood before final decisions are made. A business process and information systems roadmap which includes integration with strategic customers and suppliers is in place and enables Supply Chain Strategy.

Level 5 Supply Chain Strategy is aligned with business strategy and regularly reviewed with identified links to the business impact. Supply Chain Strategy is updated to reflect any changes in the network and customer requirements. Disparate data repositories are fully integrated to enable fact-based decisions.
   
   
   
 
* 25. Supply Chain Performance Improvement

Level 1 No external benchmarking, quantitative SC performance targets and metrics exist at individual and departmental level only. Collecting and publishing supply chain performance data is manual and difficult to tell if metric is unacceptable. There is no formal assessment of organizational effectiveness.

Level 2 Supply chain metrics are published to a broad, cross-functional audience but not consistently reviewed. Out of bounds conditions tracked but do not trigger any action. External benchmarking used to review performance of other companies but is not used to establish performance targets and targets are not linked to specific process improvement initiatives and incentives.

Level 3Quantitative performance targets exist for end-to-end supply chain processes and a supply chain scorecard explicitly linked to an overall corporate balanced scorecard in place. External benchmarking used to identify performance gaps and set target performance levels. Key supplier and customer performance metrics are highlighted when out of control using automated supply chain performance management. Performance targets are used in incentive schemes.

Level 4 Supply chain performance management is automated as part of overall Corporate Performance Management and out of bounds performance conditions trigger proactive notification and action. External benchmarking used to set target levels and identify process changes to close the gaps.

Level 5 Supply chain performance also measured against how customers measure your performance. Consistent customer reviews are also done to ensure no performance measurement inconsistencies.
   
   
   
 
* 26. Supply Chain Process Excellence

Level 1 Supply chain process architecture does not exist and process and data models are developed on one-off basis with key suppliers and customers but process owners for key supply chain processes have not been defined.

Level 2 Development and maintenance of supply chain process architecture led mainly by IT functions and process and information systems architecture is not explicitly linked to the basis of competition. Key requirements of data sharing with customers and suppliers are defined and documented and any required regulatory data is maintained on line. Standard work processes are developed.

Level 3 Process architectures have been defined but content differs by country or region. Key requirements of data sharing with customers and suppliers are defined using common definitions. Supply chain process and information systems architecture is optimized around primary basis of competition and process architecture integrates all supply chain sub-processes, data, metrics and applications.

Level 4 Process architecture is standardized globally and integrates all supply chain sub-processes and describes the links with other core processes. Planning data, business rules and transaction data synchronization is regular and done electronically across supply chain partners

Level 5 Supply chain process architecture is customer centric. A common set of metrics for measuring performance are used across all participating nodes. IT solutions meet all business process requirements and is assessed regularly.
   
   
   
 
* 27. Supply Chain Organization and Development

Level 1 Core competencies not considered when structuring supply chain organization. Recruiting, staffing, and education/training plans are driven by functional departments and no career paths defined for supply chain professionals.

Level 2 Specific competencies and roles needed to enable effective SCM are documented. Each major supply chain process has an accountable functional or individual process owner, responsible for end-to-end objectives and formal assessment is performed less than once a year.

Level 3 Recruiting, staffing, and education/training plans explicitly integrate the competencies needed for overall SCM. Specific skills required to support collaboration with suppliers are identified and integrated into competency model. Formal assessment of supply chain organization's effectiveness performed one to two times a year.

Level 4 Supply chain professionals are strategically deployed inside key customer and supplier organizations. Recruiting, staffing, and education/training plans explicitly integrate the competencies needed to enable overall Supply Chain Strategy.

Level 5 Chief Supply Chain Officer is appointed and heads a cross functional team. Company-wide training and development program is in place at all levels. Pay is aligned with desired performance at all levels.
   
   
   
 
* 28. Green Supply Chain

Level 1 Little or no attention is paid to understand the environmental impact of the supply chain. Minimally what is required to meet the regulation directives like safe disposal of waste etc. is done.

Level 2 Company has adopted a Green Supply Chain approach that goes beyond meeting regulations and involves cost–cutting as well. Single department or functions (transportation or production) at local sites have responsibility for determining environmental impact of the practices, but there is no corporate alignment. No partners are involved and there are formal measures tracked.

Level 3 Green is part of company’s strategy, best practices for reduced environmental impact are still regional but linked to a corporate framework. Key supply chain partners (customers, suppliers, and service providers) are encouraged to be part of the approach. Common practices are shared across partners and preference is given to suppliers or service providers who have environmentally conscious practices. One or two metrics are tracked.

Level 4 Company has embraced green supply chain as means of development and growth; uses the environment as means of innovating and creating competitive advantage. Green practices are part of all departments in the organization and also integrated with most of the customers and suppliers. Information and best practice sharing to proactively reduce environmental impact are done with customers, suppliers and service providers. Green metrics are part of balanced scorecard.

Level 5 Green is de-facto way of working and reflected in company’s culture. Collaborative real-time information sharing with customers, suppliers, and service providers is done with environmental impact being one of the major parameters. Supply chain decisions consider cost, service, delivery and carbon footprint as major variables. All processes (including supporting functions like HR, Finance, Accounting etc.) follow environmentally conscious practices. Incentives consider reduction of environmental impact at all levels.
   
   
   
 
* 29. Supply Chain Risk Management

Level 1 No formal awareness and understanding of risk management is present. Where present it tends to be inefficient, informal and ad-hoc. Organization lacks commitment to risk management, the culture is risk averse and there is no strategy.

Level 2 Organization has some understanding and awareness of risk management principles. A cautious and reactive approach is followed. There is no learning from experience, a standard and generic approach is applied to all kinds of risks. Risk management competence mainly lies within one department mostly finance or accounting, its application is inconsistent and mostly applied to major projects.

Level 3 Organization has good understanding of benefits of formal risk management and a strategy has been mapped into process implementation. A consistent and scalable approach which is tailored to specific needs of functions like sourcing, logistics etc. is followed. Proficient and formal qualifications are available. Risk management principles are consistently applied and adequately resourced in appropriate departments.

Level 4 Organization is fully committed to risk management with proactive application across all functions. Company helps key supply chain partners (customers and suppliers) to manage their risks, and share rewards. Formal process with continuous improvement program is in place. Highly developed set of strategies is applied appropriately that considers risks on their merits. All employees are aware of impact of risks. Active dissemination of best practices is followed.

Level 5 Organization understands the interdependence of risks along its supply chain and has systems and processes in place to encourage a sense of collective responsibility for the management of those risks among everyone involved. Advanced tools are used to track real-time data to alert of any upcoming risks, simulation of scenarios is done to prepare the supply chain of any expected vulnerabilities. Dedicated cross-functional response teams are set up to act and respond in case of disruption. Organization has invested significant time and resources to build proactive culture of risk management which is inextricably integrated into every project, organizational function and supply chain.