SUPPLY CHAIN
Until very recently , the supplier that delivered on time , on or under budget , and stuck to the letter of the contract was the golden standard by which all others were judged . Whether or not a supplier of such infallibility truly exists - or can be expected to - is still up for debate , but these were the qualities procurement leaders meticulously sought out . There are , after all , a great deal of efficiencies and savings to be found in stringent adherence to rules and guidelines .
If cost is the measure , however , even this conventional wisdom is being tested . In a survey conducted by McKinsey , Reimagining Procurement for the Next
Normal , the organisations that regularly innovated in partnership with their suppliers were the ones that saw the biggest earnings growth - achieving up to 10 % more . Procurement leaders already know this ; 88 % of the survey ’ s respondents said they were already engaged , or were planning to start , joint-innovation initiatives with their suppliers .
The simple fact is that there is more value in the chain . If organisations are to overcome today ’ s challenges , greater reliance and support for innovation at all points in the supply chain will be necessary . Optimisation is no longer enough ; supply chains must be agile and resilient in their elasticity .
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