A supply chain seems like an obvious place to apply advanced analytics. Almost by their nature, supply chains create data as items move from place to place - and if that data is used intelligently, a business can make better decisions about allocating resources, boosting speed and reliability and improving customer service.
The logistics industry as a whole knows that analytics is increasingly important. In fact, one recent survey found that 100% of supply chain leaders believe that deploying advanced analytics over the next few years is vital to their business.
And yet, the same survey found that fewer than half have a strategy to implement leading edge analytics into their supply chain.
It’s surprising how many companies are still stuck in the “track and trace” era, where they are able to determine the current and past locations of an item, but not much more. When you think about it, knowing where your consignment is, and where it has been, isn’t necessarily all that helpful.
And that gets to heart of the value of advanced analytics. The next step – a huge leap – from track and trace, is to take that information and factor in lots of other relevant, bespoke data. That’s when you reach the holy grail - the realm of integrated logistics.
So why the resistance to investing in better analytics? It might be because there is a reluctance to make the initial investment. Maybe logistics professionals find it hard to convince their managers. Perhaps companies think they can save money more easily elsewhere.
But a recent study by the business consultancy Accenture found that better analytics could improve demand forecasting by up to 20%, reduce inventory by 20%, reduce the amount of spare parts a company might need to have on hand and reduce warranty costs.
In fact, logistics may be one of the most effective places for most businesses to save money, and better analytics is one of the best ways to do this.
Businesses need maximum visibility across an entire supply chain. And as data is generated from that chain, it can be fed into predictive models that help businesses make more informed decisions and minimise future risks.
The supply chain control tower won’t just tell you where individual items have been or where they are right now.
- It will also tell you if the items will get there on time.
- It can pinpoint possible bottlenecks.
- It can proactively identify business risks.
- It can route your shipment to avoid trouble and delays.
- It will tell you when you are spending too much money on premium freight.
- It will also help improve business practices and accountability with your partners.
They are more likely to live up to their end of the bargain if they know their largest contractor can see how well they’re fulfilling their obligations.
As various industries become more competitive and companies look to their supply chain to save money, it will become clear that a backward-looking “track and trace” approach to analytics just isn’t good enough.
Business and retail customers increasingly expect companies to get any shipment right the first time. Better analytics will help companies achieve this goal by improving service while anticipating and preventing supply chain problems before they arise.
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Supply Chain Management
With our logistics resources and global reach, we are able to make your supply chain lean, agile and demand driven. Partnering with us gives you the opportunity to focus time and resources on your core business. We integrate end-to-end solutions from order fulfilment and transport management to visibility and monitoring.