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Supply Chain Cost Management

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Supply Chain Cost Management

The AIM & DRIVE Process for Achieving Extraordinary Results

AMACOM,

15 min read
10 take-aways
Audio & text

What's inside?

Create a process for working cooperatively with your suppliers to reduce your costs – and theirs.

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Editorial Rating

7

Qualities

  • Innovative

Recommendation

Author Jimmy Anklesaria’s “AIM & DRIVE” process is a method for reducing costs by working with your entire supply chain. You will learn how to assemble a cost-cutting initiative, how to bring your suppliers into the process and how to work with them to benefit mutually from cost reductions. Anklesaria’s writing is a bit colloquial, but that means it reads easily, which offsets some of the necessary dryness of the process descriptions. The book has helpful worksheets plus samples of actual work from the author’s clients. Anklesaria has written this manual for people who work regularly with suppliers, so it is not directed toward the general business reader. However, it is no more complex than necessary. getAbstract recommends it to practitioners at all levels who wish to manage costs cooperatively.

Summary

The Importance of Cost Management

Every company understands the need to control costs. Lowering your costs sends money straight to your bottom line. When CEO Lou Gerstner and supply chain expert Gene Richter came to IBM to turn things around, Richter told his procurement team to follow a five-step program to make IBM profitable and competitive: “1) Reduce costs; 2) Reduce costs; 3) Reduce costs; 4) Reduce costs; and 5) Reduce costs.” The problem is that most companies, big and small, have a hard time understanding their own cost structure, let alone identifying excess costs in their supply chains.

Companies tend to start cost initiatives in the middle of crises, so timing often makes the task of cutting costs even more difficult. You have little opportunity to be thoughtful and clear-headed when you are under severe pressure, your business is on fire and relations with your suppliers are strained. The good news is that many high-quality companies have worked through these cost issues and you can learn from their leadership. No two businesses are exactly alike, but business processes are quite similar in purpose and method. Your goal should be to make continuous cost...

About the Author

Jimmy Anklesaria is an expert in supply chain cost management. Many Fortune 500 companies have hired him to conduct seminars and workshops on the subject.

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