Rio Tinto's world class iron ore operations−spanning 17 mines, more than 1,200 miles of rail, and 4 port terminals−have undergone a transformative AI-driven upgrade. Working in partnership with BCG X, this transformation enables stronger decision making while unlocking significant value.
How BCG Supports Supply Chain Management
BCG believes that customization is essential for a successful supply chain transformation program. We tailor our offerings to help companies strike the right tradeoffs among cost-effectiveness, agility, sustainability, and resilience. Our digital and AI implementations are targeted to solve each client’s distinct supply management pain points.
Our Approach to Supply Chain Management
BCG's unique approach to supply chain management puts people and processes first, with technology geared toward addressing validated business needs.
Our Approach's Impact
Our Approach's Impact
2pp-4pp
boost in EBITDA
10%-20%
decline in costs
5%-15%
increase in service levels
20%-30%
decrease in near term CO2e emissions
We begin by applying our proven approach to diagnose supply chain issues and the tangible value at stake. We then build capabilities, institute change management programs, and rapidly scale technology solutions to enable service-level improvements, provide platforms for growth, and capture sustainable savings. Here are four key ways we help clients future-proof their supply chains:
- Cost-Effectiveness. Our cost management efforts focus on connecting silos in order to optimize supply chain costs while improving service and reliability. We also right-size integrated manufacturing and logistics networks to better meet demand, as well as improve distribution and warehousing to get products to customers faster and cheaper.
- Sustainability. We accelerate supply chain sustainability through a well-coordinated suite of initiatives. These include creating transparency across all emissions scopes and supply tiers, optimizing product designs for sustainability, engaging suppliers, and fostering ecosystems. We also introduce low-carbon governance to align internal incentives and empower the organization.
- Agility. We help companies build agile supply chains that allow them to rapidly adapt to changes in markets and customer demands. Companies can leverage flexibility, real-time visibility, collaboration, and advanced technologies to enhance growth, transformation, innovation, and supply chain resilience.
- Resilience. We help companies gain competitive advantage and mitigate risk by building supply chain resilience. This includes diversifying the supply footprint to ensure access to key markets and resources, implementing flexible sourcing and manufacturing, and boosting operational risk awareness and traceability.
Across these efforts, we help companies utilize digital products and solutions and AI to improve decision-making, drive supply chain optimization, and foster sustainable supply chains. Capabilities such as Supply Chain AI help clients focus on the highest-value supply management opportunities and gain insights that strengthen supply chain resilience by helping them recover faster from supply chain disruptions.
Our future-proofing approach also includes using GenAI to enhance the data backbone, augment supply chain analytics, overhaul the user experience, and fully automate processes.
Our Supply Chain Management Work with Clients
Using PLAN AI and next-generation analytical inventory models, we developed advanced forecasting tools to spark faster, more precise decision-making for a global medtech player. 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.
A fashion retailer aimed to enhance demand planning, targeting 3% to 10% annual EBIT growth. Accurate planning was impeded by fragmented decision-making processes across channels and tool-centric approaches that relied on off-the-shelf solutions. After a thorough diagnostic and more than 100 stakeholder interviews, BCG developed a future state vision for digital demand planning, with major EBIT opportunities uncovered in capacity booking, assortment, and buy quantity.
A global beverage company was facing high costs compared to regional competitors. It also had committed to ambitious sustainability targets, necessitating significant cost reductions. BCG worked with them to create and implement an operations transformation. By streamlining the platform and portfolio for the client, we implemented a centralized operating model to manage product flows and reduce logistics costs. The company was able to establish a more efficient and resilient supply chain network and a clear path to substantial cost savings.
Video
December 10, 2024
Scheduling the World’s Largest Fully-Owned and Integrated Iron Ore Supply Chain
Video
April 27, 2021
GSK’s Digital Path to Operational Excellence
Deploying artificial intelligence at scale and digitizing supply chains aren't easy tasks. But pharmaceutical giant GlaxoSmithKline surmounted the challenges. How? It executed a disciplined data-and-analytics transformation program that unlocked maximum value--fast.
Video
March 27, 2023
Sanofi’s Digital Transformation Journey
A global pharmaceutical company launched a transformation to create value at speed and scale—with the goal of generating hundreds of millions of euros in incremental profit.
Video
March 27, 2023
How Heineken Europe Is Transforming Its Supply Chain
The brewer launched a supply chain transformation program to reduce complexity, build new ways of working, and reduce its carbon footprint. Here’s how it succeeded.
Our Featured Supply Chain Management Tools and Offers
Our battle-tested, holistic approach to supply chain management is supported by our suite of advanced proprietary tools and solutions, including the following:
Supply Chain AI
Supply Chain AI takes a holistic approach to transforming supply chains, from strategy and design through planning and optimized execution.
Supply Chain AI
Solution
Solution
CO2 AI
Part of our partner ecosystem, CO2 AI enables organizations to measure, simulate, reduce, and track their environmental footprint at scale.
CO2 AI
Solution
Solution
Compass Performance Benchmarking by BCG
Our proprietary database benchmarks companies against industry leaders to unlock competitive supply chain and manufacturing advantage.
Compass Performance Benchmarking by BCG
Our Latest Insights on Supply Chain Management
Article
November 14, 2024
GenAI overcomes the complexities of previous AI implementations through user-friendly interfaces, agent-based automation, and cross-functional orchestration.
Video
January 24, 2022
How to Fix Broken Supply Chains
In the face of disruptions, from natural disasters to pandemics, how do we make sure supply chains can keep up?
Dustin Burke, BCG managing director and senior partner, offers a combination of solutions to help create a more resilient, efficient tomorrow.
Article
February 6, 2024
With parallels to the complexities of building a house, BCG’s approach to transforming a supply chain emphasizes the importance of coordination, digital enablement, and speed.
Article
January 26, 2021
Even companies with modest direct-emissions footprints can make a global impact on decarbonization by implementing nine initiatives in their supply chains.
Article
August 2, 2023
Right investments in supply chain resilience can generate substantial value, which is especially important in helping a company withstand an economic downturn and maintain a competitive advantage.
Article
October 20, 2023
Resilient companies prioritize cybersecurity. And those that rely on a smooth-functioning supply chain are increasingly giving precedence to managing the cybersecurity risks of their suppliers, not just their own.
BCG-WEF Project: AI-Powered Industrial Operations
How can manufacturers harness the latest technologies to optimize for increased productivity, improved sustainability, greater resilience, and a stronger workforce?
Meet Our Supply Chain Management Consulting Leaders
Our supply chain management consulting team consists of hundreds of experts around the world with deep expertise in supply chain strategy, supply chain optimization, supply chain sustainability, supply chain risk management, and mitigating disruption in supply chains. Here are some of our experts in supply chain management:
