Product Development and Procurement
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Product Development & Procurement

Unlock the full potential of your portfolio through product and service design and transformation

Guide the creation of exciting product and service portfolios

A collaborative approach to design and development steers the creation of new products, services, and software. Our approach, which combines customer, technology, operations, and market insights, along with our partnership with McKinsey Design, creates exciting portfolios of new products and services that deliver the right experience for your customers.

Increase profitability through product and service life-cycle optimization

Our innovative methodology to optimize products shifts the focus from design-to-cost to design-to-value. Taking a customer-back approach, and leveraging the best from our design and analytic teams, we bring together customer insight and traditional cost levers in new ways, resulting in improved products for both our clients and their customers.

Improve agility and effectiveness through development

By delivering a holistic transformation of engineering departments, we ensure organizations remain agile, effective, and ready to deal with a rapidly evolving market.

Optimize spend categories

Pioneering approaches and digital solutions combine to optimize direct and indirect spend categories as we leverage our innovation, expertise, analytic, and digital tools. By implementing a total-cost-of-ownership approach, including environmental impact, we support clients through the complete process to reach execution, including the negotiation stage.

Drive productivity and innovation with suppliers

In a time of rapid innovation, we help clients leverage the broader supply ecosystem to drive process and product development. This results in maximum impact from supplier relationships, using advanced programs to create integrated product and service life cycles.

Maximize procurement impact through agile digital operating model

We guide the creation of a streamlined next-generation operating model, characterized by digital user journeys. By designing agile processes that incorporate source to pay, we help to reduce leakage and to sustain performance to meet future needs.

20%+

improved margins

from portfolio realignment

30%

quality improvement

through life-cycle management

20×

return on investment

from next-gen operating-model implementation

Featured Videos

A new approach to digital procurement—Orpheus, a McKinsey company

Following McKinsey's acquisition of Orpheus, a recognized innovator in digital procurement, we are pleased to launch Orpheus, a McKinsey company. The new service will enable spend transparency, spend and cost analytics, and value-capture management. The offering is a powerful combination of Orpheus’ advanced platform technology with McKinsey’s industry experience and content-rich services in digital procurement.

Immersive Ideation

Immersive Ideation breaks the constraints of the physical world by using virtual-reality technology, backed by advanced analytics in fields such as procurement cost, customer insights, and pricing, to help teams visualize practical solutions to complex problems. The result is a faster, more reliable way to bring all of an organization’s expertise together in finding the best options for delivering value to customers.

Featured capabilities

Cleansheet

Cleansheet analyzes a product’s underlying cost structure to help organizations establish cost transparency, set target costs, and capture savings. Resource Cleansheet applies an environmental lens, calculating the environmental impact of the entire product or service lifecycle.

Centers of Competence

Our Centers of Competence bring expertise in cost engineering, category knowledge, and benchmarking that deliver faster and higher impact with our best-in-class procurement and product-development tools.

DTV Labs

Across the globe, ten Design Labs support clients with design-to-value (DTV) efforts, including competitive teardowns, cleansheet costing, training workshops, customer and brand analytics, and idea generation.

Global Sourcing Centers

We offer client support throughout the entire global sourcing process by leveraging best-cost country (BCC) suppliers. A global team of analysts from five Sourcing Centers, located in best-cost sourcing “hot spot” locations, help provide our clients implementation-level support in global sourcing diagnostics; country and category prioritization; supplier identification and evaluation; supplier bidding, negotiation and selection; and global sourcing organization design.

McKinsey Implementation

Find out how we work on site with clients to help them achieve long-term improvement and measurable, bottom-line results. We help strengthen leadership, transform processes, and build capabilities. Learn how we work intensively with clients across all industries and topics to improve performance and produce results: rapid, significant, measurable improvements in productivity, cost, quality, sales, and other metrics.

Product Development & Procurement (PDP) Academy

We take a blended approach to learning, combining assessments with online courses, classroom training, coaching, and group work to create targeted learning journeys for different cohorts. We have a proven methodology focused on creating value.

Source2Pay (S2P)

S2P enables clients to realize the full potential of procurement savings in profit and loss by linking category-sourcing strategies to procurement operations—putting the optimal processes, organization, and digital procurement tools in place that enable simple, efficient, and compliant third-party spend.

Featured insights

Blog Post

A new approach to digital procurement—Orpheus, a McKinsey company

– The role of spend analytics and the procurement function is changing.
Article

Reimagining procurement for the next normal

– Procurement has led the way out of a crisis before, and can again. But success will mean rethinking every aspect of the function.
Article

The role of spend analytics in the next normal

– The COVID-19 pandemic has proven that procurement functions can deliver at speed. But how can they also ensure that they’re... spending wisely?
Article

The present-focused, future-ready R&D organization

– There’s no one right way to organize R&D. But a set of core design principles can provide the flexibility R&D organizations... need to outpace competitors.
Article

Taking supplier collaboration to the next level

– Closer relationships between buyers and suppliers could create significant value and help supply chains become more resilient.... New research sheds light on the ingredients for success.

Featured experts

Bill Wiseman
Senior Partner, Seattle
Client service innovator that brings new management science to technology and industrial clients
Wajih Abou-Zahr
Senior Partner, Dubai
Brings deep experience in telecommunications, helping leading companies win market share, drive top-line growth, and transform...
Robert Hiroshi Mathis
Senior Partner, Tokyo
Brings global industry expertise to support automotive and assembly companies in achieving aspirational performance goals and...
Camilo Martins
Partner, São Paulo
Brings operations expertise to Latin American consumer companies, helping executives transform their procurement, manufacturing,...
Anna Herlt
Partner, Munich
Advises companies as they seek to optimize the value of their research and development investments, particularly within the automotive...
André Rocha
Partner, Tokyo
Serves global companies across a wide range of industries—such as advanced electronics, high tech, medical devices, automotive,...
Takehito Sumikawa
Partner, Tokyo
Leads strategic, operational, and organizational transformations for Japanese, Asian, and global companies and institutions in...
Wouter Aghina
Partner, Amsterdam
Delivers large-scale performance and health transformations, improving performance, changing culture, boosting organizational...
Hubert Heersche
Partner, Amsterdam
Leads product optimization at McKinsey globally, using digital capabilities and analytics to improve product design and cost
Sander Smits
Senior Partner, Amsterdam
Transforms operational performance and optimizes research and development for leading companies in the advanced industries sector
Koen Vermeltfoort
Partner, Amsterdam
Advises oil and gas companies on capital projects, procurement, and strategy

Careers

Interested in a career in Operations?

A career within our Operations Practice offers the opportunity to work with the biggest companies in the world, on projects that transform their core business and build resilience for the future. We are continuously seeking the best talent at all levels and for all types of roles, and are particularly keen to talk to experienced professionals looking for their next challenge.

Connect with our Operations Practice