News & Research: Client Successes

Case Study: Supply Chain Organizational Design

ScottMadden assisted a northeastern electric utility with assessing their procurement and materials management organizational design to respond to competitive pressures associated with impending deregulation.

• The company was preparing for deregulation and wanted to develop a strategy and implementation plan for acquiring, storing, distributing, and disposing resources
• A number of supply chain improvement initiatives had been identified as part of a recent reengineering effort, but their implementation was being hindered by the need to make organizational design changes
• The company wanted to build in flexibility to support the future separation of non-regulated businesses (likely required as part of deregulation) and improve the overall effectiveness of the procurement and materials management operations

• Completed assessment of the supply chain organization design. Scope included all procurement and materials management functions within the company, except for fuel procurement and real estate
• Conducted a supply chain best practices survey addressing company demographics, work practices, roles and responsibilities, and organization structure. Used survey results to guide future state design
• Facilitated an internal team through a process to re-design the procurement and materials management organizations:
  • Established organizational design principles
  • Defined organizational building blocks
  • Determined where and how reengineering recommendations should be addressed in re-design
  • Developed detailed implementation plans
  • Defined staff roles and responsibilities and drafted key manager position descriptions

• Organization structure was implemented as recommended
• Supply chain processes were enhanced through implementation of reengineering initiatives