Gartner’s list of the top 25 Supply Chain Performers aims to inspire and educate our community on some best practices and success themes from currently successful supply chains. Our analysts ranked various companies against our criteria and success themes and have provided a composite score based on these factors.
In the last article (Supply Chain Performers), we explored the effective supply chain management of L’Oreal and Walmart, which are ranked ninth and eighth on our list, respectively. This time we discover how PepsiCo and Intel have created success in overcoming their unique supply chain challenges.
To maintain their position in the industry’s fierce competition, PepsiCo is the second-leading beverage and food company in the world because of its efforts in streamlining its supply chain. They diversified with the heavy acquisition of other popular drinks as well as more nutritious snacks. The growth and expansion of PepsiCo demanded streamlined, adaptive, and innovative supply chain features that could support their customer demand.
Their product line now includes noncarbonated drinks, such as coconut water and juices, which require extra supply chain management to distribute. Some products require temperature-controlled logistics, while others have ingredients sourced from multiple different parts of the world. Managing these complexities required the PepsiCo supply chain to have a cooperation and integration strategy that ensures their stable and flexible business operations.
Digitization and Technology
PepsiCo is another business that has successfully incorporated technology and digital tools to streamline its supply chain. Their focus was specifically on data integration and improving the accuracy of their customer information to obtain as clear a picture as possible.
PepsiCo uses this valuable data to meet the fluctuating customer demand in short-term movements like seasonal variations and long-term trends like climate change. This sophisticated data help PepsiCo’s retailers and distributors track their inventory and manage their replenishment effectively. Stores enter significantly more accurate sales data, which translates to more insightful sales history and purchasing trends. Therefore, digitization also provides information for better strategizing, marketing, and forecasting long-term for PepsiCo as a whole organization.
PepsiCo has many standalone policies on human rights, environmental protection, and sustainability to enhance the ethics of its supply chain. These policies outline clear guidelines for their suppliers, including labor, anti-corruption, and environmental management practices – the company updates this annually in response to any new concerns, with a 24-hour hotline for worldwide partners to seek help and guidance.
The company has established various sustainability initiatives among their supply chain, focused on promoting responsible agricultural practices – leading to healthier crop yields and improving suppliers’ livelihoods while protecting the environment. One initiative was to implement AI-assisted agriculture for their farming suppliers in India. This robotic-powered farming delivers precise crop analysis while also developing the knowledge and skills to support their suppliers to succeed in a tech-heavy future.
Social responsibility is imperative for major corporations that have a monumental impact on our environment and whose operations affect countless employees. PepsiCo’s innovation in this area has positioned them for future success as well as shown us all how to be responsible and successful.
One of Gartner’s supply chain success themes is the alignment of overall business strategy with supply chain strategy, and Intel is one business that has excelled in stitching its core company strategy into its supply network. This no longer just means driving efficiency and cutting the costs of their suppliers and customers – Intel approaches this through leveraging their supply chain to grow a standalone revenue source, one that became a business branch of its own.
Benefitting From Their Own Services
Intel’s work currently focuses on developing solutions to meet the soaring demand of the data-driven future, which looks past traditional PCs and goes into services that analyze, store and transform data. Intel formed the Internet of Things Group (IOTG), responsible for creating products utilizing cloud and gateway technology, which rapidly became a growth area for their customers across every industry.
By every industry, we also mean logistics, transportation, distribution, and supply chain management. Having created these products and services, Intel realized their own supply chain could benefit from using their IOTG services, a realm previously not adopted by tech giants. Intel is obviously well equipped at incorporating this tech into systems, so they leveraged this position to streamline their own Supply Chain Performers’ operations using data.
Supply Chain at Intel
Intel manages a supply chain of over 14,000 suppliers and processes over a terabyte of logistics data every day. Their work in incorporating their IOTG technology into their supply chain grew to become an entire unit for Intel. Intel’s global supply chain manager developed her own team called Supply Chain at Intel, which would provide expertise in using the IOTG to streamline various business units’ supply chains.
This team began consulting other businesses and is responsible for inspecting the company’s operations worldwide and providing solutions that meet the growing need for digital solutions. Real-time tracking on conditions and location of shipments, along with the need for blockchain, AI and digitization, were common solutions they developed to improve external supply chains.
Intel is a business that had so much success in creating an innovative solution to enhance their own supply chain that they could outsource their management solutions to help other companies. That’s completely telling of Intel’s effective supply chain management and why they have so much to offer our community.