Supply Chain Process Evolution
Through the thousands of benchmarking and best practice studies that The Hackett Group has conducted with leading companies worldwide, distinct stages of supply chain process evolution have emerged. At top-performing companies, the supply chain process has evolved to the point where the procurement function delivers substantially more strategic value to the enterprise than at typical companies.
Stages of Supply Chain Process Evolution
The Hackett Group classifies corporate procurement capabilities as being in one of four phases of maturation:
- Reactive. As the label suggests, in the reactive stage, the procurement function is consumed entirely by ground-level, day-to-day supply chain process execution – launching purchase orders, doing “three bids and a buy,” and so on.
- Planned. A procurement organization in the planned stage has built sufficient human and system resources so that it is able to raise its sites and work on more forward-looking facets of supply chain process, including supply chain strategy development.
- Aligned. An aligned procurement function is one in which procurement strategy and supply chain process are not only forward-looking but also carefully aligned with the needs of key internal customers and the business goals of the enterprise as a whole.
- Strategic. In the most advanced stage, the strategic stage, the procurement function has established itself as a proactive and valued partner in the strategic planning of the enterprise, enabling the enterprise to respond quickly and effectively to changes and challenges in the supply markets. A procurement organization at this level plays a key role in advising senior management on strategic sourcing options such as outsourcing and offshoring.
A procurement organization and supply chain process deliver more value to the enterprise as they mature through these stages.
The Hackett Group Can Help You Get More Value from Your Supply Chain Process
As a leading global strategy and operations consulting firm, The Hackett Group helps procurement executives improve the efficiency, effectiveness, and business value of their supply chain process. Our supply chain process consulting, like all of our back-office consulting services, draws on The Hackett Group’s world-leading best practices benchmarking database, derived from our more than 13,000 benchmarking engagements with major companies around the globe. The Hackett Group brings deep expertise in best practices and business process engineering into all of our advisory programs and consulting engagements.
Through our Archstone Consulting group and our working capital group REL, we have more than 30 years of hands-on experience in all facets of supply chain process performance optimization. We can help you analyze and benchmark your current supply chain process; identify gaps between your performance and that of top performing procurement organizations; size and prioritize areas for improvement; and develop and execute an implementation roadmap.
To learn more about how The Hackett Group can help you get more value from your supply chain process, as well as our other services including finance consulting, cash flow analysis and more, contact us.