ANSR Hackett Grp., Inc.(The) (MM)

World-Class Retain Lead in Effectiveness with 46 Percent Fewer Suppliers, Planning Involvement & More Cross-Functional Supplier Development World-class procurement organizations generate 133 percent greater return on their investment in procurement than typical companies, driving an additional $3.6 million to their company's bottom line for every $1 million in procurement operations costs, according to 2005 Book of Numbers(C) Research from The Hackett Group, a business process advisory firm (NASDAQ: ANSR). Hackett found that while typical companies are narrowing the cost gap to world-class in procurement, world-class companies now see procurement operations costs that are 20 percent less than typical companies and have about half the procurement staff. But there are significant differences in how procurement leaders generate increased effectiveness and strategic business value in their enterprises. According to Hackett, world-class procurement organizations also show dramatically improved effectiveness over typical companies. They now operate with 46 percent fewer suppliers, are nearly five times more likely to be involved in enterprise-wide planning initiatives, and make much greater use of cross-functional teams for supplier sourcing, selection/negotiation, and partnering/development. The Hackett Group is a world leader in best practice research, benchmarking, and advisory services that empower executives to achieve world-class enterprise performance. Hackett offers analysis and insight backed by metrics derived from 3,300 benchmark studies over 13 years at nearly 2,000 of the world's leading companies, including 96 percent of the Dow Jones Industrials. "Yes, typical companies have narrowed the functional cost gap to world-class. But all cost reductions are not created equal," said Hackett Procurement Practice Leader Chris Sawchuk. "In too many cases, typical companies end up cutting into high-value areas like performance management, customer management, and strategic sourcing. By contrast, world-class companies increase their focus on spend avoidance, develop deep partnerships with suppliers, and minimize costs in low-value areas like transactional processes." According to Hackett Director and Senior Business Advisor Pierre Mitchell, "The bottom line is that world-class companies continue to take a very different view of procurement, looking at it as an investment rather than a cost center. This is how they generate the millions of dollars in additional savings that typical companies simply don't see." According to Hackett, world-class procurement organizations now see procurement operations costs that are 20 percent less than typical companies (0.68 percent of procurement spending versus 0.85 percent). World-class procurement organizations also now operate with nearly half the staff (44.9 staff/billion of spend versus 89.2). Hackett's research showed that world-class procurement organizations generate 133 percent greater return on the cost of procurement operations than typical companies. Hackett calculated these returns by dividing spend savings (spend reduction attributable to procurement practices) by the total cost of procurement operations, generating a return as a percentage of procurement operations costs. While world-class organizations netted a return of 630 percent, typical companies only saw a 270 percent return. This gap demonstrates that world-class procurement organizations deliver additional savings of 360 percent, or $3.6 million for every $1 million invested in procurement operations. NOTE TO JOURNALISTS: A chart illustrating select findings described above is available on request, and will be distributed via Business Wire. Supply base rationalization and partnering with key suppliers remain key techniques that world-class procurement organizations utilize to reap benefits, according to Hackett's research. World-class procurement organizations operate with 46 percent fewer suppliers than typical companies (7,710 per billion of spend versus 4,171) and also concentrate 80 percent of their spending on just 5.9 percent of their suppliers, significantly fewer than typical companies. But cost savings are only one measure of success. World-class procurement organizations also outperform their peers across a wide range of other effectiveness metrics, and show clear strategic alignment and linkages between procurement and the spend owners. Procurement is highly involved in enterprise-wide planning and budgeting 57 percent of the time at world-class companies, nearly five times more often than typical companies. Hackett also found that 100 percent of all world-class procurement organizations use cross-functional teams for supplier partnering/development, sourcing, and selection/negotiation, making them 37 to 50 percent more likely to do so than typical companies. The Hackett Group's research into world-class performance is compiled in its Book of Numbers series, which provides senior executives fact-based performance metrics and insights based on Hackett's extensive database of best practices and process metrics in IT, finance, HR, procurement, and other areas. Hackett Book of Numbers volumes are available to members of Hackett's World-Class Programs -- premium-value, membership-based programs providing a tailored mix of benchmarking services, confidential advisor inquiry, best practices research, and peer learning opportunities. More information on The Hackett Group is available: by phone at (770) 225-7300; by e-mail at info@thehackettgroup.com; or on the Web at www.thehackettgroup.com. About The Hackett Group The Hackett Group (www.thehackettgroup.com), a business process advisory firm and an Answerthink company, is a world leader in best practice research, benchmarking and advisory services that empower executives to achieve world-class enterprise performance. Only The Hackett Group empirically defines world-class performance in sales, general and administrative (SG&A) and supply chain activities with analysis gained through 3,300 benchmark studies over 13 years at nearly 2,000 of the world's leading companies. The foundation of Hackett's benchmarks, transformation services, and membership-based advisory programs is our proprietary database of Hackett-Certified(SM) Practices, approaches which are proven to correlate with superior performance metrics. This unparalleled knowledge repository enables Hackett business advisors to provide data, advice, and strategic insight with a level of integrity and authority available nowhere else. As of this writing, Hackett clients comprise 96 percent of the Dow Jones Industrials, 77 percent of the Fortune 100 and 92 percent of the Dow Jones Global Titans Index. Hackett-Certified, Book of Numbers, and Hackett World-Class Passport are service marks of The Hackett Group. This press release contains "forward looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks, uncertainties and other factors that may cause Answerthink's actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward looking statements. Factors that impact such forward looking statements include, among others, the ability of the products and services mentioned in this release to deliver the desired affect, our ability to effectively integrate acquisitions into our operations, our ability to attract additional business, our ability to effectively market and sell our recently launched transformation advisory product offerings and other new services, the timing of projects and the potential for contract cancellations by our customers, changes in expectations regarding the information technology industry, our ability to attract and retain skilled employees, possible changes in collections of accounts receivable, risks of competition, price and margin trends, changes in general economic conditions and interest rates as well as other risks detailed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2004 filed with the Securities and Exchange Commission. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.