Companies have already taken steps to reduce costs along the supply chain. Further reductions require tougher decisions in several key areas.
Sustaining Value from an Advanced Digital Supply Chain
Now more than ever, supply chains need to be resilient, agile, cost efficient, and sustainable. Supply Chain AI by BCG X helps companies optimize on all levels—with no tradeoffs.
2pp-4pp
boost in EBITDA
10%-20%
decline in costs
5%-15%
increase in service levels
15%-30%
reduction in working capital
20%-30%
decrease in near-term CO2e emissions
Supply chains act as our connective tissue, supporting growth and sparking innovation. But increasingly, they are the source of challenges and constraints. Rising costs, shifting demand, critical disruptions—many companies are in a continuous cycle of assessing obstacles, identifying fixes, and hoping for the best.
Supply Chain AI, our digital supply chain offering, lets companies return to creating value. A combination of digital assets, supply chain experts, and data science and engineering talent, Supply Chain AI takes a holistic approach to transforming a company’s supply chain, from strategy and design through integrated planning and optimized execution. Backed by a unique set of AI solutions from BCG X, we enhance seven key supply chain capabilities: network design and optimization, emissions baselining, risk management, end-to-end planning transformation, digital twin representations, control tower visibility, and logistics and distribution automation.
Supply Chain AI helps organizations build for the future, realizing not only the power of digital supply chain technologies but also their own full potential.
Supply Chain AI, our digital supply chain offering, lets companies return to creating value. A combination of digital assets, supply chain experts, and data science and engineering talent, Supply Chain AI takes a holistic approach to transforming a company’s supply chain, from strategy and design through integrated planning and optimized execution. Backed by a unique set of AI solutions from BCG X, we enhance seven key supply chain capabilities: network design and optimization, emissions baselining, risk management, end-to-end planning transformation, digital twin representations, control tower visibility, and logistics and distribution automation.
Supply Chain AI helps organizations build for the future, realizing not only the power of digital supply chain technologies but also their own full potential.
Our Approach
The supply chain of the future must be digital, resilient, and sustainable. To deliver, companies need the right strategy and the right mix of human and technical capabilities. Our approach amplifies the power of AI in the supply chain—but just as crucially, we help develop the plans, processes, skills, and culture that fuel and accelerate transformation.
Our digital supply chain consultants work in agile ways that bring out the best of both people and tech. Individual squads have expertise in, and accountability for, specific supply chain topics, and they focus on flexibility and enablement. We address gaps by building on top of existing solutions, realizing the full value of a company's data and in-house systems. We also draw on our world-class change management capabilities to ensure success, now and for the long term. Our customizable approach, fit to a client’s unique goals, follows a general paradigm:
Our digital supply chain consultants work in agile ways that bring out the best of both people and tech. Individual squads have expertise in, and accountability for, specific supply chain topics, and they focus on flexibility and enablement. We address gaps by building on top of existing solutions, realizing the full value of a company's data and in-house systems. We also draw on our world-class change management capabilities to ensure success, now and for the long term. Our customizable approach, fit to a client’s unique goals, follows a general paradigm:
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Assess current state
We start by leveraging industry-specific context and experience to develop hypotheses on where value is typically created. By assessing your current digital maturity within supply chain processes and existing AI capabilities, we can identify the pain points and opportunities that matter most and lay a vision for unlocking the potential of AI and digital supply chain technologies. -
Define end state
We create a strategy and prioritize use cases that help map and fund the overall journey. We focus on quick wins to build momentum and then move to the next wave of use cases and repeat. By taking an iterative approach and steadily building out use cases, companies can see the end state early on, justifying their decision to keep turning the investment knob. -
Realize value
The iterative use case approach lets companies build their technical capabilities gradually while realizing near-term value. Companies develop just what’s needed to fuel a specific use case and benefit from their new capabilities. A key enabler is an individualized data and digital platform, which lets companies add capabilities in a modular, flexible way across their end-to-end transformation. -
Develop foundational capabilities
Wave by wave, as new capabilities come online, companies build a foundation for AI in the supply chain. Our digital supply chain consultants help companies upskill talent in digital, AI, and data and technology architecture. We also assist with democratizing AI and analytics, a practice that is critical to success.
How it works
Introducing End-to-End Supply Chain Transformation
Supply Chain AI’s seven solutions help companies fuse the best of technical and human capabilities, enhancing visibility, agility, and decision-making across the supply chain.
Launching New Transformation with Supply Chain AI
Emerging technologies, particularly advanced analytics and generative AI, enable businesses to optimize their supply chain processes and decision making, predict flash points, and quickly adjust course. But digital supply chain technologies cover a lot of ground. The aim, and often the challenge, is to use them where they matter most.
Supply Chain AI has a set of specialized AI solutions built by BCG X, that can be combined and customized in ways that maximize value—keeping the focus on the most important opportunities and issues. Each solution provides a rapid diagnostic to uncover high-value use cases, establishing a complete vision before recommending the right combination of people, processes, and technology. Supply Chain AI can be tailored to a company’s unique targets and benchmarks, and our digital supply chain consultants can build and deploy AI-enabled processes in any environment.
Our Clients’ Success with Supply Chain AI
We’ve worked with businesses across industries and across the globe to help build the supply chains of the future. Here are some examples of our impact.
Operational excellence for a health care logistics company
Through a multitiered transformation program, we helped optimize the client’s warehouse footprint and reduced network costs by lowering transportation costs and leveraging synergies. We deployed technology to facilitate planning, increase automation, and reduce manual labor and error rates. And we cut complexity in “kitting” via kit simplification and standardization. The expected outturn: annualized run-rate savings of up to $155 million.
$155 million
annualized run-rate savings
Increased value creation for a global steel producer
BCG’s digital supply chain experts helped a global steel producer complete a comprehensive digital transformation. Using predictive analytics, we focused production decisions on optimizing margins by building a data management infrastructure and developing advance forecasting algorithms. The outcome: a boost in EBITDA of 2 to 4 percentage points and a transition to net positive from year one onwards.
2pp-4pp
boost in EBITDA
Inventory optimization for a global medtech player
Using End-to-End Plan by BCG X, and next-generation analytical inventory models, we developed advanced forecasting tools to spark faster, more precise decision making. And to ensure that our client could build on this foundation long after we completed our work, we embedded new processes and upskilled in-house teams. The result: an inventory reduction of more than $100 million in the first 12 months and a 15% increase in forecasting accuracy.
$100 million
inventory reduction
Meet Our Supply Chain AI Consulting Team
GenAI overcomes the complexities of previous AI implementations through user-friendly interfaces, agent-based automation, and cross-functional orchestration.
BCG surveyed 125 companies that ship cargo to gauge their willingness to pay a premium for carbon-neutral shipping. Their responses present both challenges and opportunities for the shipping industry.
Today’s conditions bring more complexity to the supply chain officer role—perhaps even redefining it—as businesses face the threat of economic slowdown while trying to find new opportunities.
Building resilience and promoting sustainability while maintaining cost efficiency, service levels, and growth requires redesigning your network—and that will take several years. Better get started.
Many steel manufacturers haven’t yet embraced AI, but that doesn’t mean they can’t. All that’s required is an openness to experimentation and a willingness to change.
Companies have already taken steps to reduce costs along the supply chain. Further reductions require tougher decisions in several key areas.
GenAI overcomes the complexities of previous AI implementations through user-friendly interfaces, agent-based automation, and cross-functional orchestration.
The root cause of the problem lies not with technology but with how and where companies are applying it.
AI remains a top priority for business leaders worldwide in 2025, with a strong focus on generating tangible results, according to BCG’s survey of C-suite executives.
AI remains a top priority for business leaders worldwide in 2025, with a strong focus on generating tangible results, according to BCG’s survey of C-suite executives.
BCG’s survey of 1,400+ C-suite executives reveals that GenAI is quickly changing the way companies do business—and big gaps are emerging between the winners and the observers.
BCG’s survey of 1,400+ C-suite executives reveals that GenAI is quickly changing the way companies do business—and big gaps are emerging between the winners and the observers.
COOs always focus on costs, but inflation, uncertainty, and other prevalent factors today increase the urgency of making their companies’ operations more efficient.
Biopharma and medtech companies that adopt a digital-native approach can generate better outcomes, lower costs, and greater customer satisfaction.
GenAI overcomes the complexities of previous AI implementations through user-friendly interfaces, agent-based automation, and cross-functional orchestration.
Organizations must use all their data, customize and link their underlying systems, and manage the transition patiently to get the best from the new breed of IBP platforms.
Implementing GenAI is not easy in an industry with a complex value chain and intensive regulatory oversight. Companies will wrestle with both choice and complexity.
A big part of improving immunotherapy for patients may lie in digital technology and analytics.
Black swan events and growing volatility have snarled supply chains. BCG X offers a virtual solution: Value Chain Digital Twin.
With the right supporting structure, companies can use new technologies to dramatically increase profitability and improve overall performance.
Companies can anticipate risks and make critical optimization decisions far sooner than previously possible.
Explore Our Insights on Digital Supply Chain
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