Strategic Cost Reduction – Global Commodity Management – Procurement Best Practices
Improving bottom line company financial results through the implementation of best procurement practices is our consulting focus. Our recognized skill set has led us to successful engagements with Purchasing, Supplier / Manufacturer Sales and Business Development, Mergers and Acquisitions..
Using our robust processes we find and implement hidden cost opportunities in Direct Material, MRO and Transportation Purchases by providing:
- Expertise: Proven executive leaders and commodity managers with expert knowledge on a broad range of commodities.
- Knowledge: To help clients assess strategic procurement options and negotiate the best possible terms.
- Processes: That provide rapid program and savings implementation.
- Technology: Our proprietary ProcureForce product enables cost reduction through the development of “should be” cost models.
Call APD when you want to transform:
- Underperforming procurement groups into metric focused, high performing teams working in concert with other departments.
- Win/lose purchasing supplier relationships into transparent and collaborative where all parties benefit.
- Reactive design driven pricing into a proactive approach using supplier cost structure knowledge to drive optimal design.
Supplier / Manufacturer Sales and Business Development
- Connect and help grow the business of proven low cost suppliers with world class manufacturers through APD’s Open Book Cost Modeling Process.
- Change from traditional inaccurate costing systems (plant wide burden rates, burden based on labor, etc.) to accurate costing systems.
Mergers & Acquisitions
- We help buyers evaluate purchasing cost risks and opportunitiesof acquisition targets.
- We develop post acquisition improvement strategies for reducing material costs and improving purchasing performance.
- We lead the implementation of the improvement strategies while helping build the purchasing team so that they can continue the effort after we have disengaged.
ADP performs global RFQ supplier searches for clients to help identify new sources around the globe. In addition, we perform thorough organizational assessments of purchasing policies, procedures, talent and organizational structures to find opportunities for improved performance.
Client Impact Analysis
The Client Impact Analysis will provide an objective assessment of existing conditions to pinpoint both challenges and strengths. A strategy to quickly achieve world class purchasing practices is then developed. The final solutions are a combination of:
- Shrewd cost engineering applications
- Working with ProcureForce (a proprietary purchasing based software tool)
- Encouraging collaborative supplier relationships
- The positive impact the purchasing solution will have on other organizational functions
Case Study 1
Initial assessment of a $300 million company revealed sub-optimized areas in cost reduction tracking and tools, as well as employee development, rewards and recognition. Implementation of a strategic plan to address these concerns led to a sustainable doubling of the annualized cost reductions and a 90% decrease in supplier rejects.
Case Study 2
Assessment of a $2 billion manufacturer identified an immediate need for an information systems upgrade, cost reduction tracking, and improved employee selection and development. Within ten months of conducting a gap analysis and executing the corrective measures, the company realized a 65% increase in cost reductions.
Case Study 3
An $800 million automotive supplier was having trouble leveraging material cost opportunities across 5 autonomous divisions. Using information obtained in an Excellence Assessment, APD mapped out a strategy that allowed the company to maintain divisional autonomy while obtaining improved cost reduction by selectively centralizing procurement on commodities where opportunities existed.
Case Study 4
APD was contracted by the General Manager of a $135 mil division to identify quick improvement opportunities in the process and structure of its purchasing organization utilizing our Excellence Assessment. When presented with the results of the Assessment and recommendations, the CEO immediately contracted APD to start working with his larger division.
Case Study 5
A $1.4 billion manufacturer had radically changed its manufacturing footprint and centralized many aspects of the business. Purchasing, however, remained geographically decentralized. Through an Excellence Assessment, APD identified and led the implementation of process improvements that enabled the company to centralize it procurement function, reduce headcount by 25% and improve material cost reduction performance.