Using analytics in the supply chain has the most potential to dramatically reduce costs of supply chain management, as well as minimizing supply chain disruption. Unfortunately, the upfront investment costs for deploying the technology necessary to use analytics can be difficult to justify, so Warehouse Managers need to know a few things about house analytics to enable the minimization of supply chain disruptions. This insight can be used to improve supplier relationships and gain shareholder support for new system implementations, upgrades, and additional use of modern technology.
The Problem: E-Commerce Data is Almost Overwhelming
Today’s supply chains, including those using small or nonexistent omnichannel supply chains, generate a mountain of data. Unfortunately, the amount of generated data is difficult to comprehend, and even more difficult to analyze. This is where analytics come into play. Analytics are crucial stepping stones in minimizing supply chain disruption, says Supply Chain Management Review; however, disparate systems result in inconsistencies. Analytics is only as effective as its weakest link, so failure to integrate all systems will lead to unforeseen issues and additional disruptions in the supply chain.
[WHITE PAPER] The Top Supply Chain Trends that Will Impact Supply Chain Management in 2018
The Solution: Minimizing Supply Chain Disruption Requires Analytics
The only way to successfully minimize supply chain disruption is through continuous improvement. Continuous improvement can permeate every aspect of supply chain management, ranging from vendor management to reverse logistics. Warehouse Managers should focus on integrating systems and connecting existing systems to an analytics platform. Since the modern world is heavily focused on cloud-based technology, analytics platforms often exist in the cloud as well. Thus, the Warehouse Manager should work to bring their systems into the 21st century by connecting systems to the Internet of Things (IoT).
The Reward: Additional Benefits of Analytics in the Supply Chain
Analytics in the supply chain can have hundreds of potential benefits, but some of the most notable effects of deploying analytics in the supply chain include the following:
- Lower overhead expenses. Analytics in the supply chain can be used to analyze the costs associated with supply chain management and inventory management. By identifying the actual expenses versus decreases to expenses, analytics can provide Warehouse Managers with actionable insights to lower operating expenses.
- Better forecasting. Having the ability to know when product will be needed and where is a common hallmark of a truly omnichannel supply chain. Analytics in the supply chain allows for better demand forecasting, reports Supply Chain 24/7. Depending on the degree of analytics used, as well as the ability to access it and analyze information from both consumer facing and business facing platforms, Warehouse Managers can move product between distribution centers, regional warehouses, brick-and-mortar stores, and every other potential channel.
- Real-time visibility and accountability into product location. Since customer experience is everything in the modern supply chain, analytics can be used to improve real-time visibility and accountability into freight and product location. If something occurs that will result in an unforeseen delay, such as weather-related events, analytics can be used to identify the best course of action to avoid negative customer experience, and if possible, analytics can be used to avoid this issue in its entirety. In other words, analytics could be used to identify potential weather-related risks to a given shipment and select an alternate route.
- Collaboration with other supply chain partners. Analytics in the supply chain also help to improve collaboration by allowing Warehouse Managers to identify strengths and weaknesses within their existing supply chain partnerships.
- Innovative inventory management in order fulfillment strategies, such as slotting optimization and waveless picking, can be used to improve labor productivity and reduce the costs associated with order fulfillment, inventory carrying, and returns management. Essentially, getting products to customers faster, accurately, and without additional cost will reduce returns management at the same time.
Use Analytics to Supercharge Your Supply Chain Today
The value of analytics is undisputed, and given that the number of Internet-enabled devices, connected to the Internet of Things, is expected to climb into the trillions over the next decade, Warehouse Managers should focus on implementing analytics in the supply chain today. Failure to implement analytics throughout all aspects of supply chain management and activities could result in lost competitive advantage and additional costs to the company. Instead of taking the risk, give your organization the boost it needs by deploying analytics in the supply chain, integrating systems, and taking advantage of the newest technologies possible.