Procurement has become a strategic lever for performance and business resilience as global volatility continues to expose structural vulnerabilities in supply chains. Heightened geopolitical risks, supply shocks, and regulatory shifts have made resilience a core competitive advantage, even if it leads to extra costs.
Our offering, enabled by AI-based tools such as Inflation Control Tower and Supplier Risk Monitor, helps provide transparency, predict and mitigate supply risks and prevent supply shortages, analyze inflation impact on product costs, and adjust end-product pricing.
The New Pareto: Focusing on Suppliers Instead of Categories
To deliver value through savings, CPOs in all industries need to cut procurement expenditure substantially and quickly, but the conventional approach of focusing on reductions in category spending is too slow and often insufficient to generate competitive advantage. A more effective approach leverages both supplier relationships and technology and is tailored to each of the following major vendor segments:
A Suppliers. Our innovative 360° Program for A Suppliers engages the most senior levels, including the C-suite, to get the right decisions in place. The ambition is bold: to double the savings in a partnership mode.
B Suppliers. We push for procurement excellence, an approach that focuses on using the right commercial and technical levers, backed by the right preparation, to cut costs. BCG’s AI Negotiation Coach tool helps make this a reality, suggesting to the buyer the right go-to-market approach and analysis. Over time, the coach—an algorithm—learns from the outcomes and becomes increasingly strategic and effective.
C Suppliers. Our step-up-to-contribute program harnesses potential savings from the smaller vendors (which tend to fly under the radar) by increasing their visibility and making them contributing partners. Our AI Tail Cutter tool generates an appropriate savings target and steers the communication with an individualized approach.
Inverto, an international procurement and supply chain consulting company acquired by BCG in 2017, complements BCG's procurement approach with its strong focus on implementation to achieve fast and tangible impact, deep category knowledge from thousands of client projects, and numerous category benchmarks for maximum impact.
Savings. For a German bank looking to achieve near- and long-term savings in procurement spending, we used commercial and technical levers yielding an immediate 12% savings. By optimizing the target operating model, we developed 20 additional initiatives in governance, procurement mandate, savings tracking, and other areas.
Operating Model Redesign. For a large energy player, we conducted a full procurement optimization program that included the design of a new, center-led operating model. The work covered key processes and a capability-building program for teams, generating savings of 10% of addressable spending.
Sustainability. Our strategy for CO2 reduction at a European automotive OEM emphasized procurement practices, focusing on Scope 3 emissions under the Paris Agreement as the basis for new CO2 targets. We then outlined the required measures—including timing and cost—and laid out intermediate and long-term milestones.
Digital Transformation. We partnered with an international oil and gas company in Asia to create a roadmap for its digital procurement transformation. After completing our digital maturity review, we identified 11 use cases across strategic and operational procurement, prioritized efforts, and produced a detailed schedule for year-one digital implementations.
BMW Group is partnering with BCG to optimize efficiency and innovate workflows with GenAI leveraging Auto AI by BCG X. The solution was developed in collaboration with BCG X, AWS, and BCG Platinion. The streamlined approach to day-to-day operations is creating exciting new opportunities for growth.
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BMW Group's Transformation: Turning GenAI Concepts into Scalable Success
BMW has launched a major transformation initiative, leveraging GenAI to streamline procurement tasks, rethink processes, and improve supplier interactions. As an extension of our existing partnership around AI, BCG and BMW are now partnering with AWS, BCG X, and BCG Platinion to ensure a secure, scalable integration of GenAI.
In today’s volatile environment, the benefits of a strategic approach to procurement are greater than ever.
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2025年8月25日
Elevating Procurement to the Leadership Table | BCG EDGE 2025
More than half of a company’s costs are external. Procurement has become essential to managing volatility and safeguarding margins in a shifting environment.
Procurement is poised to capitalize on AI, which can streamline manual work in key processes by up to 30% and reduce overall costs by roughly 15% to 45%.
AI presents transformative opportunities for companies looking to gain strategic advantages and operational efficiencies across procurement functions.
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2025年1月27日
The Cost-Saving Power in Procurement
Declining producer prices have given process industry firms a crucial but limited window of opportunity to renegotiate contracts and set a new cost baseline.
