Case Study

Sourcing process redesign delivers 6% direct spend savings for a global transportation major

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A U.S. based transportation major wanted to optimize sourcing for non-production commodities.

Business challenges

  • No well-defined sourcing strategy for commodities like C-parts, electronics, fabrication and machined parts
  • Prevalent use of non-strategic suppliers resulting in high spends and low negotiation power

Genpact solution

  • Detailed spend analytics and effective negotiation strategies based on historical price patterns, potential volumes
  • Spend consolidation from non-strategic to strategic suppliers
  • Cost analysis to identify the actual cost of the part
  • Drive savings through negotiations on the new pricing

Business impact delivered

  • $2.5 million savings (5-6% on total spend) through effective sourcing process
  • Increased compliance and better negotiating power with the supplier

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