Managing Director & Partner; North America Regional Practice Leader
The disruption caused by COVID-19 underscores how critical it is for companies to achieve excellence in end-to-end operations, given the potential gains in efficiency, agility, and performance. BCG helps clients achieve operational innovation to meet this imperative.
Cost excellence goes beyond simple cost-cutting measures. End-to-end (E2E) operational excellence can deliver impressive value for companies—including a 5% to 15% boost to EBITA; cost reductions of 5% to 10% in third-party procurement spending, 15% to 30% in operations overhead, and 10% to 25% in warehousing and distribution; and a 50% to 80% reduction in carbon footprint.
BCG’s operational excellence consulting teams help clients achieve these gains by supercharging efficiency and effectiveness in key steps in their operations value chain. We also assist clients with holistic value-chain transformation to enhance service and quality, reduce costs, and mitigate risks.
Clients choose BCG as their operational excellence partner for:
The result: a leaner, more agile enterprise that can flex as needed to win—not just now but also far into the future.
BCG is uniquely positioned to help clients extract maximum value from their operational excellence programs, bringing several core strengths to every project, including:
E2E PT combines classic process-optimization methods with the advantages of digital technologies to deliver unmatched efficiency gains and top-notch customer experiences. Through E2E PT, we help clients diagnose the performance of their end-to-end processes, envision what optimum performance would look like for each one, redesign processes to achieve target performance, activate the new designs, and craft a roadmap for further process transformation.
End-to-End Supply Chain (E2E SC) Optimization helps clients tackle supply chain challenges such as SKU complexity, inventory forecasting errors, supply disruption risk, unbalanced manufacturing footprints, and rising customer-service costs. We start by helping clients develop a vision for their end-to-end supply chain, quantify the value potential, and prioritize improvement opportunities. We then work with them to define the operations required to achieve their business objectives. Finally, we help them implement pilots aimed at scoring quick wins that free up funds for future-state design efforts. Throughout, we deploy a suite of tools that support activities such as supply chain diagnostics, data governance, change management, and the deployment of digital solutions.
BCG Advanced Network Optimization (BCG ANO) draws on advanced analytics and simulation modeling to help clients achieve unprecedented savings and prepare for growth by optimizing their asset networks, including manufacturing footprints. Whereas conventional network-optimization tools allow companies to test just one strategy at a time, BCG ANO enables them to assess multiple strategies simultaneously, speeding time to implementation of the best strategies. The tool thus constitutes a paradigm shift, from hypothesis testing (identifying network options by calculating and comparing predetermined possibilities) to hypothesis generation (uncovering the optimal network setup by identifying completely new possibilities).
Consumer Packaged Goods
A regional spirits manufacturer aiming to become a global brand asked BCG to help optimize its supply chain. A comprehensive overview pinpointed improvement opportunities in areas such as bottling-plant capacity and S&OP efficiency. The analysis unveiled significant value-creation opportunities--including $70 million to $80 million in inventory reductions and $11 million to $13 million in COGS.
Two industrial goods manufacturers merged and asked BCG to help them capture synergies, maximize service quality, and minimize costs and complexity in products and materials. Projects including cost modeling, plant capability assessments, and supplier negotiation strategies positioned the new entity to achieve $130 million in run-rate savings—more than 1.5 times the initial synergy target.
A global Tier 1 automotive supplier enlisted BCG to help stabilize its supply chain network as the pandemic struck. We established a COVID-19 task force with focus areas including health and safety and volume forecasting, and supply chain and logistics control towers to boost efficiency and decrease operating costs. Encouraged by these moves, the client considered extending the work into the following year.
A federal government agency engaged BCG to create a COVID-19-response roadmap and evaluate infrastructure-investment risks, including supply shortages. Through investment-scenario modeling and interviews with senior government officials, we confirmed supply stability for most materials, identified potential logistics choke points, pinpointed bottlenecks in project-approval processes, and identified procurement-process improvements--setting the stage for recovery and resilience.
To enhance competitiveness, companies must take a clean-sheet approach to deciding what, where, and how to manufacture.
BCG’s approach delivers greater efficiency, an improved customer experience, and a more engaged workforce, enabling banks to meet today’s challenges.
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