Supply Chain Management: A Source of Corporate Liquidity

January 20, 2009
Industry Trends
Global, Asia-Pacific, EMEA, Latin America, North America

Abstract

Milan, Italty 21 January 2009

Corporations are forcing banks to turn away from a traditional product-oriented approach and toward one that is more conscious of their customers’ needs and expectations. Banks must carefully focus on how corporations are freeing up cash. Across corporations, supply chain management practices are a source of extra cash flow.

In this report, , Celent examines how corporations (which are measured on cash conversion cycles and working capital minimization) are finding alternative sources of funding. This underscores a strategic element of today's economic conditions: cash flow, more than revenue, is king.

Banks must carefully focus on how corporations are freeing up cash. Our research shows that corporations are increasingly focused on running supply chain management practices as a source of generating extra cash flow and freeing up liquidity.

The report begins with an analysis of the tangible benefits and opportunities underpinning adoption of disciplined practices to optimize corporate working capital. It continues with a description of the current business scenario. Corporations are adopting strategies for survival in a new economic environment, so banks need to keep abreast of such practices as:

  • Innovate and be flexible
  • Use supply chain management practices as a reference
  • Analyze operational processes
  • Be customer-centric
  • Be entrepreneurial
  • Be proactive

"The new business environment will be characterized by innovation and flexibility," says Enrico Camerinelli, senior analyst with Celent’s Banking group and author of the report. "Corporations that want to survive must be able to transform the concepts of innovation and flexibility into an actionable agenda. Celent expects that supply chain management practices will play a strategic role in corporate growth and sustainability."

The report is 40 pages long and contains 16 figures and one table. A table of contents is available online.

of Celent's Corporate Banking research service can download the report electronically by clicking on the icon to the left. Non-members should contact info@celent.com for more information.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Milan, Italy 21 January 2009

Supply Chain Management: A Source of Corporate Liquidity

 

Executive Summary 3
The Business Case 6
Current State 12
What Does the End State Look Like? 19
What Needs to Be Done? 24
Conclusion 36
Appendix 38
The EVA Model 38

 

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