SCM Data: What Can You Do With It?

September 22, 2016

scm data

Supply chain professionals are aware of the benefits data analytics can provide. Recent research, however, depicts that companies find it challenging to formalize a clear strategy on how to apply SCM data to business processes in order to make better business decisions. Many organizations struggle to determine how, and where, they can utilize supply chain data to benefit their organization’s different functions, as well as their overall business. The supply chain industry has been slow to implement big data analytics into supply chain processes. This is increasingly evident when compared to other industries, such as marketing or manufacturing, who have been taking advantage of big data for several years to make smart business decisions.

The supply chain has always been driven by statistics and quantifiable KPIs. However, the sort of analytics that are disrupting the industry today have not been widely adopted. An example of this would be the end-to-end real time analytics that cover the end-customer interaction (e.g shopping experience) all the way to the final delivery. Such solutions include structured and unstructured data from all stakeholders.

Oh, and have I mentioned that this is a complex task to carry out?

It demands smart and passionate thinkers. Fortunately, there are plenty of best practices in regards to streamlining and optimizing functional parts of the entire business across all industries. The companies that we see performing the best take these things seriously.

That being said, big data has started to make its way into logistics and supply chain management.. The exponential growth of eCommerce in b2b and b2c is paving the way. End-customers are demanding more, and by default, you’re expected to provide the best possible shopping and delivery experience. It must be timely, efficient and well-communicated. If a merchant delivers just one negative experience, the customer often disappears forever. Logistics plays a key role in the success equation of eCommerce. Products can typically be purchased anywhere, and from multiple sources. The overall shopping experience is what matters the most.

SCM Data Benefits Depend on Your KPIs

The range of big data use cases in operations and supply chain management is limited only by available data and the imagination. SCM data can be used to improve the manufacturing process, design custom products and experiences, improve quality assurance, manage the risks in the supply chain, improve the customer experience and much more.

For enterprises, using data wisely can yield significant monetary value in both revenue and cost side. Nokia (in the past) was a great example of a well-operated supply chain management operation.

Another important point to note is that global regulations are increasing all the time. If you sell a wristwatch with a leather band, for example, throughout the entire physical flow the data must move with the product. If Customs were to stop a container full of products without proper documentation they may not make it on the shelves for the holiday season. What would the financial impact be of such a setback? Anyone can imagine.

Optimizing SCM Data for Operations 

Data collected, enriched and made available to/from all parties within the global process holds immense importance in relation to continuous optimizing of operations; hence it is very important to value the data availability from these stakeholders. Technology is available to help collect all of this data in various databases, and tools are there to make the data understandable for the decision-making process. All parties should hold themselves accountable for interacting with the data, especially considering the ease of access to the data.

Change always occurs. It doesn’t necessarily make sense to invest, upfront, years of time and millions of dollars trying to define the perfect world, because in reality, circumstances and people change too quickly. Keep it simple, work with agility, and move on step-by- step leveraging best practices along with the data in your supply chain.

Air cargo as a specific industry is good example case in global logistics, since the systems and models deployed have been the same forever. The shippers (producers, merchants who live or die with their success) rely on 30 years old models in today’s world where air cargo is the fastest delivery option usually. For example, the magnificent, fresh fish from Portugal’s coast must often be frozen, transported by truck to Paris or London restaurants, where they find their way to your table. This allows them to compete with Chinese frozen products. Why?

Luckily companies like Amazon and Alibaba, for example, are disrupting such legacies. Their passion is to use big data to help the entire ecosystem grow and be successful, from the end-customer to the producer of components. Those guys who have the “holes in the socks” should roll the sleeves up and modernize their systems and operations. If not, they will disappear.

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