In today’s world, companies are under immense pressure to cut costs within their Supply Chain. Year after year, many companies blindly use past historical goals as future metrics without much data or analysis. The market demands have become unpredictable, unique, and diverse while requiring lightning-fast decisions to be made. Because of this rapid change, operational foundations created yesterday can no longer support today. It is time to break the cycle when it comes to supply chain cost optimization. By applying a Zero-Based Budget mindset and leveraging tools like Anaplan in your Supply Chain, you have the ability to focus on must-have costs in the future and reduce the unnecessary ones.
How Do You Start Implementing Zero-Based Budgeting in Your Supply Chain?
Spaulding Ridge understands the technology and underlying processes to support Zero-Based Budgeting transformations. We guide organizations with these core principles in mind.
ZBB Core Principles:
Increase Visibility with Bottom-Up Approach.
A bottom-up approach allows organizations to drill down into operational data, understand cost drivers, and make informed spend decisions when attempting to cut costs.
Leverage technology Systems.
Spend time defining the right processes, not analyzing your data. Anaplan centralizes your data and analysis so it can do the heavy lifting for you.
Focus on the Future, Not the Past.
Don’t cut COGS based on an arbitrary percentage. Harness predictive capabilities of Anaplan to focus on future business needs and strategic initiatives.
Avoid Quick Cuts, Understand the Impact to Your Bottom Line.
Near-term fixes don’t always mean long-term gains. A ZBB approach combined with smart tools allows you to understand the true impact cost cuts have on your bottom line, long-term.
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