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Supply Chain Graphic of the Week: Is It Time for Supply Chain 4.0 in Consumer Goods?

 

McKinsey Identifies Six Value Drivers it Says will Lead to Step Change Improvements in Cost and Agility

May 26, 2017
SCDigest Editorial Staff


OK, we've certainly heard talk in recent years about moving to supply chain 2.0 - whatever that means.

 

We've even heard references to supply chain 3.0 - and now Accenture is pushing something it calls supply chain X.0 - more details on that soon.

 

Not to be outdone, the consultants at McKinsey are now pushing a vision for what it calls supply chain 4.0 in the consumer goods sector. Whether it had previously detailed 2.0 and 3.0 models we're not sure, but we do not remember seeing it.

 

Regardless, McKinsey has produced this busy chart, which identifies six "value drivers" and then assorted strategies associated with each.

 

 

 


Following this roadmap will "enable a step change in service, cost, capital, and agility," McKinsey says.

 

McKinsey adds: "The potential impact of Supply Chain 4.0 in the next two to three years is huge. Expectations include up to 30% lower operational costs, 75% fewer lost sales, and a decrease in inventories of up to 75%. At the same time, the agility of the supply chains should increase significantly."

 

We will look at this McKinsey vision in more detail in coming weeks- including how McKinsey says it came up with these numbers.

 

Any Feedback on our Supply Chain Graphic of the Week? Let us know your thoughts at the Feedback section below.

 

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