Strategic Transformation in the Supply Chain
Segment: construction products
Executive Summary:
This case study examines the successful supply chain transformation of a client who was facing significant challenges in their operations due to a lack of competitive advantage in a saturated market. By identifying and focusing on critical elements, we adopted a strategic approach that resulted in a 45% reduction in raw material costs and a doubling of final product sales, standing out as a notable example of cost optimization and quality improvement .
Context:
Our client was facing stagnation in sales due to a lack of differentiation in a saturated market and limited choice of national suppliers. The lack of flexibility and control over raw material quality was a significant obstacle to growth.
Challenges:
1. Lack of competitive advantage due to the homogeneity of products on the market.
2. Limitation of choice and lack of control over raw material specifications.
3. Need to reduce costs without compromising the quality of the final product.
Solution
1.
Identification of critical items to improve quality and reduce costs.
3.
Specifications alignment and rigorous supplier mapping using advanced tools.
2.
Focus on two materials considered commodities, but with a history of problematic quality.
4.
Approval of suppliers for each material, maintaining high quality standards.
Results
• 45% reduction in raw material costs.
• High quality maintenance of developed materials.
• Double sales of the final product due to the combination of reduced costs and improved quality.
Impact and Lessons Learned
This case highlights the importance of a strategic approach in the supply chain. By focusing on specific areas and adopting rigorous supplier selection practices used at Sigma-Y, our client not only significantly reduced costs, but also dramatically improved the quality of the final product. This transformation not only boosted sales but also set a new standard for efficiency and excellence in the industry.
This case study illustrates how a carefully planned strategy can lead to positive business transformation, highlighting the importance of innovation and careful selection of supply chain partners for sustainable business success.