McKinsey acquires consulting firm SCM Connections to help clients transform supply chain

Management consulting firm McKinsey and Co. Inc. says last week’s acquisition of SCM Connections will bolster its expertise in advising client companies on how to transform their end-to-end supply chain planning.

McKinsey on Nov. 2 bought SCM Connections, a 12-year-old Chicago-based consulting firm that provides technology-enabled supply chain planning and analysis through Advanced Planning and Scheduling (APS) software. SCM says tools like supply optimization, multi-level inventory optimization, and advanced demand forecasting algorithms can help its customers gain long-term competitive advantages.

McKinsey said it will complement that offering with its McKinsey Digital capabilities, creating a service that can use advanced analytics and artificial intelligence (AI) to solve supply chain problems and help customers expand their supply chain capabilities.

According to the company, the timing for the acquisition was right as the need for effective supply chain management and planning was greater than ever due to ongoing factors such as the Covid pandemic, geopolitical tensions, labor shortages and general economic uncertainty.

“Global supply chain issues are becoming increasingly complex and volatile supply chains are forcing companies to modernize the tools they use to forecast demand and plan supply and inventory to meet it,” Daniel Swan, senior partner and global co-convenor of McKinsey & Company’s operations practice, said in a press release. “Today we are in a new era of supply chain management, where advanced planning capabilities are critical and digital innovation is the bridge to resilience. With this acquisition, we can help our customers embed a complete end-to-end technology-enabled supply chain planning approach to drive long-term growth and build resilience.”

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