IS YOUR SUPPLY CHAIN IN A DEATH SPIRAL ?
18 % think leadership has the right initiatives for cost reduction targets .
Executives have not turned a blind eye to systemic supply chain issues , but most are simply not achieving sustainable results . “ An analysis of 20 leading products and consumer companies shows that since 2010 , most have seen COGS as a percent of sales remain stable or increase , even though almost all have continuous improvement and COGS-focused reduction programs ,” states the report . The top companies have seen only two to three percent improvement says Accenture , which found that because “ many organisations work in functional and geographical silos ”, it ’ s often impossible to know who is spending what , where and why .
The challenge of targeting this problem is already being addressed with the zero-based budget ( ZBB ) – which means going back to the drawing board with your budget on a regular basis to justify every expense . It ’ s an approach companies with huge supply chains , like Coca-Cola and Kraft-Heinz , have embraced to save money through the axing of thousands of unnecessary jobs , the closure of inefficient factories , the sale of corporate jets – and even going as far as requiring workers
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