Strategic Procurement Initiative — How to Make it Happen

Abstract

As demonstrated through our case experience and BCG’s recent surveys, procurement is viewed as a strong lever for achieving differentiation. Not only is it a strong lever for achieving cost advantages, but more and more it is becoming a powerful mean for innovating products and services. Whereas top line improvements have only marginal impact on the P/L, any reductions of procurement cost directly raise the bottom line. But there is more to it than that: suppliers not only deliver products and services on time, they are potential strategic partners which can significantly contribute to innovation and service levels — in other words: they can be a source of competitive advantage.