Many companies are unsure of how to transform their procurement organizations to reduce costs while maximizing value from supplier relationships. The consulting team at Ricardo Strategic Consulting (RSC) can unlock hidden value in direct material purchasing with opportunity prioritisation and sourcing execution while directing supplier development and performance improvement. For example, large-volume suppliers often struggle with minimizing costs in manufacturing niche, small-volume production runs for service organizations. This capability is especially effective at transition products for high-volume production to lower-volume service production. We have led multiple programs for major original equipment manufacturers (OEMs) to transition internal plant production capabilities to an external supply base, generating $100M+ in lifetime cost avoidance.
Additionally, transportation, supply constraints, and critical part situations may impact the ability to utilize traditional global supply chain participants, requiring manufacturers to expand beyond their existing supply bases. Our clients have access to RSC’s proprietary database of global suppliers, which offer the unique ability to mix and match project requirements with global supply chain participants and specifically tailor the value chain to deliver program sourcing requirements successfully.
As a result of RSC’s unique heritage, and by building on the technical foundation of the wider Ricardo group, our experienced professionals are familiar with all types of transportation components, from advanced technologies to commodity materials. By combining this with a strong business and commercial background, and based upon years of experience, the RSC team is able to leverage our industry-proven capabilities to develop robust sourcing plans, including:
- Cost structure analysis to support comprehensive negotiation strategies
- Program management of category-specific RFI / RFQs / market tests for global supply chains
- Supplier qualification to ensure credibility and capability
- Globalized supply base development to maximize sourcing cost-efficiency
The RSC team deploys proven practices and methodologies for cost calculation, supplier development, and program management. Our approach involves:
- Level-setting product requirements, summary of current state, and supply chain strategy
- Comparing suppliers with structured, data-driven assessments of critical attributes
- Instigating competition between preferred suppliers and credible challengers to generate attractive business cases
- Creating structured approaches to evaluate business cases across a wide array of significant metrics