€7M
Loss elimination delivered
Chemical Company Value Chain Improvement Eliminates €7M Losses
A leading global provider of specialty chemicals partnered with EFESO to enhance the maturity of its Supply Chain practices through a holistic inbound materials optimization program. By deploying a Total Cost of Ownership (TCO) methodology across the value chain, the company identified key loss areas, implemented targeted improvement projects, and achieved €7 million in loss elimination.
Industry: Chemicals
Service: Supply Chain
Our Client
A leading provider of specialty chemicals and services to the food, healthcare, industrial and energy sectors. The business had grown rapidly as a result of acquisitions and was already quite advanced with functional initiatives to reduce cost.
The Challenge
The client had grown rapidly through acquisitions and had already implemented various cost-reduction initiatives at a functional level. The next maturity step in Supply Chain development was to optimize inbound materials management holistically—considering the total cost of ownership (TCO) rather than isolated functional costs.
Key challenges included:
• Fragmented improvement efforts: Cost reduction initiatives focused within individual functions without a unified framework.
• Lack of end-to-end visibility: Limited understanding of how inbound supply practices impacted total cost and performance.
• Need for internal capability building: Cross-functional teams required a shared methodology for identifying and eliminating losses.
Real Results Achieved Together
The collaboration generated substantial financial impact and established a sustainable TCO improvement model.
19
Focused improvement projects initiated
2
Cross-functional teams trained and deployed in pilot projects
Transformation Impact
- Developed and implemented a Total Cost of Ownership loss eradication methodology across inbound materials operations.
- Built internal capability through EFESO-led training and pilot projects executed over four months.
- Created full value chain visibility from Procurement to Material Processing.
- Established a foundation for continued improvement through 19 structured projects running through 2018.
Our Approach
EFESO supported the client in deploying a customized, end-to-end Total Cost of Ownership improvement framework:
- Development of a Holistic TCO Methodology
• Designed a tailored approach to assess losses and benefits across the inbound supply chain.
• Enabled fact-based prioritization of improvement opportunities. - Identification and Activation of Key Loss Areas
• Conducted detailed mapping and analysis of inbound materials processes.
• Identified main loss drivers, resulting in €7M improvement potential across various activities. - Capability Building and Cross-Functional Collaboration
• Trained two dedicated cross-functional teams in TCO loss eradication techniques.
• Ensured full involvement of both suppliers and internal functions to embed continuous improvement practices.
Related Services
Supply Chain
Supplier complexity obscures 70% of your value creation. We strengthen networks through supplier development programs, risk mitigation strategies, and collaborative innovation platforms.
Ready to Transform Your Supply Chain Into a Competitive Advantage?
- Unlock millions in hidden value across your entire value chain
- Stop leaving money on the table with fragmented cost reduction initiatives
- Join leading companies achieving breakthrough results through holistic TCO optimization
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