🔺 Why Supply Chain Management Should Report to the C-Suite, Not Finance By Sam Abughali

Legacy Structures Are Holding Us Back

In countless modern organizations, supply chain management (SCM) remains nestled under the finance department—a vestige of an era when supply chains were simply seen as cost centers. This hierarchy may have served its purpose decades ago, but today, it is actively holding businesses back.

The world has changed. The supply chain function has evolved. And yet, the structure around it has not.

Today’s supply chain is no longer just a tool to reduce spending. It is the engine that powers agility, enables innovation, upholds sustainability, mitigates risk, and secures a competitive edge. Treating it as a subordinate to finance not only diminishes its role—it fundamentally misaligns the organization’s strategic capacity.

When Finance Leads Supply Chain, Strategy Suffers

The typical finance lens is narrow by necessity. It’s focused on cost control, margin protection, and ensuring that fiscal results meet expectations. While this financial oversight is important, it often sidelines the long-term vision that supply chain leaders are equipped to champion.

This results in a culture of short-termism. Operational agility, supplier partnerships, and customer responsiveness are sacrificed at the altar of quarterly savings. Even worse, decisions made with pure cost-cutting intent—like switching to cheaper suppliers or reducing inventory buffers—can ripple into serious long-term consequences: compromised quality, broken vendor relationships, and dissatisfied customers.

When procurement leaders are forced to justify every initiative in purely financial terms, you stifle innovation. When warehouse operations are dictated by accounting formulas rather than data-driven logistics strategies, you lose flexibility. The ability of the supply chain to act as a growth enabler becomes an afterthought.

The Governance Disconnect: Supply Chain and Finance Are Not the Same

At a structural level, finance and supply chain are inherently different disciplines. Finance functions through reporting, regulation, and compliance. It is about control, audits, forecasting, and liquidity. Supply chain, on the other hand, is execution-driven, focused on global movement, vendor networks, production flows, customer fulfillment, and operational continuity.

Mixing these two domains may seem efficient, but in practice, it blurs responsibility. When the same executive is asked to manage both corporate reporting and container delays, strategic sourcing and treasury risk, accountability weakens. Governance principles such as segregation of duties exist for a reason: clarity in leadership leads to clarity in outcomes.

Supply Chain Requires Different Expertise

There’s another critical point that’s often overlooked. The knowledge base that drives supply chain excellence is not the same as the one that sustains strong financial oversight.

Today’s SCM leaders need to understand predictive analytics, digital twins, blockchain, procurement innovation, warehousing automation, cross-border compliance, and ESG reporting. They are expected to evaluate not only cost but also sustainability metrics, ethical sourcing, human right, modern slavery risks and geopolitical exposure. These are not financial skills. They are operational, strategic, and deeply technical.

When supply chain reports to finance, key decisions often fall into the hands of leaders who—though financially adept—lack the technical understanding of supply chain complexity. As a result, critical opportunities for optimization and innovation are either delayed, diluted, or lost entirely.

Let Finance Do What Finance Does Best

Finance has its own immense challenges. From managing capital markets to navigating regulatory compliance, from controlling budgets to protecting shareholder value, the finance department is under constant pressure to deliver precision and predictability.

By adding the weight of SCM leadership to finance’s already full plate, organizations create a distracted structure. What’s more, finance teams are then pulled into operational firefights—vendor disputes, supply delays, material shortages—when their attention should be on broader fiscal stewardship.

This isn't just about SCM having a better home. It’s also about giving finance the room to focus, deepen its own capabilities, and lead in the areas where it truly excels.

What Happens When SCM Has a Seat at the Top?

Elevating supply chain leadership to the executive level unlocks strategic benefits across the business. It allows organizations to move beyond the short-term focus on cost and instead manage supply chains as engines of competitive advantage.

Take forecasting, for example. A board-level supply chain leader brings real-time demand sensing into strategic conversations, aligning inventory, production, and sales with future market shifts. They can advocate for investment in AI-driven tools that enable faster and more accurate demand planning—solutions that finance may overlook due to upfront cost, despite their long-term ROI.

In procurement, executive-level leadership can transform the function from tactical sourcing into a strategic value creator. It enables organizations to forge long-term supplier partnerships, embrace co-innovation, and pursue circular economy strategies. These moves improve resilience, reduce carbon footprints, and drive brand differentiation.

In logistics and warehousing, SCM leaders can push for the adoption of automation, robotics, and data-driven route optimization. Rather than focusing only on reducing transport costs, they’re positioned to evaluate the total customer experience, delivery reliability, and flexibility to scale.

Elevating SCM to the boardroom also improves risk response. Whether it’s a pandemic, geopolitical conflict, port strike, or regulatory shift, a supply chain executive in the C-suite ensures the business can react with speed and intelligence—not in panic.

Metrics That Matter: Beyond the Balance Sheet

Traditional financial metrics—cost per unit, procurement savings, margin contributions—only tell part of the story. When SCM leaders sit at the executive table, the organization can adopt a more holistic view of performance.

Now, resilience, sustainability, and agility become measurable goals. KPIs such as supplier risk scores, carbon emissions, fulfillment accuracy, and inventory availability gain prominence. These are the indicators that modern organizations must embrace to remain competitive, and they belong in boardroom dashboards, not buried in monthly operations reviews.

Attracting the Right Talent Starts at the Top

Another compelling argument for SCM elevation is talent. The new generation of supply chain professionals isn’t looking for back-office roles with little influence. They’re entering the field with MBAs, engineering degrees, sustainability certifications, and digital expertise—and they want to make an impact.

When supply chain is represented at the top, it sends a signal. It tells the market—and your internal teams—that SCM is not just important, but critical to the company’s strategy. This attracts high-performers, improves retention, and nurtures the kind of cross-functional leaders that future organizations depend on.

Real Leaders Who Proved the Case

We don’t need theory to prove this case. The world’s most admired companies have already shown us what happens when SCM is elevated.

Tim Cook, before becoming Apple’s CEO, transformed the company’s supply chain into a precision-driven machine. His ability to scale production, manage inventory, and synchronize global logistics played a pivotal role in Apple’s dominance.

At Amazon, Dave Clark built a logistics empire that didn’t just support the business—it became the business. His leadership introduced robotics, real-time tracking, and delivery innovations that reshaped customer expectations worldwide.

Unilever’s Marc Engel embedded ESG principles directly into sourcing and manufacturing. His supply chain became a pillar of the brand’s reputation and its sustainability leadership.

And Julio Nemeth at Procter & Gamble? He made the company’s supply chain one of the most resilient in the industry—capable of withstanding global crises while keeping shelves stocked and customers loyal.

Changing the Model: A Blueprint for Action

To shift SCM to the boardroom, companies need more than just intent. They need a deliberate structural redesign.

The first step is appointing a Chief Supply Chain Officer (CSCO) who reports directly to the CEO or COO. This leader must be involved in strategic planning cycles, M&A evaluations, innovation initiatives, and market expansion decisions. Needles to say he needs to be an SCM leader with proven track record.

From there, organizations should reevaluate their performance frameworks. Metrics should evolve from pure cost savings to include agility, ESG impact, and supply continuity.

Integration is also key. SCM should sit alongside finance, marketing, R&D, and operations in cross-functional decision-making bodies. Collaboration—not silos—will drive the future.

And finally, digital tools must be embraced. Today’s SCM functions require real-time data, predictive analytics, intelligent automation, and end-to-end visibility. The boardroom must not only empower but fund these transformations.

The Future Is Already Here—For Those Willing to Embrace It

The companies that will lead in the next decade are not those that view supply chain as a function to be managed. They are the ones who see it as a platform for strategic growth combined with the right digital tools and AI agents and process flows, right AI based ERP systems and healthy appetite for learning new technologies and tools.

They will be faster, more adaptive, and more customer centric. They will navigate disruption with confidence. They will align products with purpose, strategy with sustainability, and operations with opportunity.

They will not debate where supply chain should sit. They will elevate it—and thrive because of it.

Final Reflection: Let’s Not Ask for a Seat. Let’s Claim It.

It’s time to stop positioning SCM as a support act.

It’s not a department. It’s a direction. It’s not a cost center. It’s a capability.

Supply chain belongs in the boardroom—because without it, there is no business.