Why Data Analytics is Important
Data analytics is the process of examining and analyzing large sets of data to uncover insights and trends. They can help supply chains improve end-to-end supply chain visibility, reduce costs and mitigate risks. It can help users spot challenges in their supply chain early, leaving them with more time to find a solution or pivot. Here are a few examples of where data analytics can help improve supply chains:
Data Analytics in Supply Chain Enhancement
Data analytics unveils insights, aiding supply chains in visibility, cost reduction, and risk mitigation. Early detection enables timely solutions.
Forecasting Demand for Effective Planning
Analyzing past customer orders and statistical trends aids in inventory planning, preventing stockouts or overstocking for financial gains.
Efficient Inventory Tracking and Bottleneck Identification
Data analytics improves inventory tracking, identifying bottlenecks for timely adjustments, preventing stockouts, and minimizing waste.
Supplier Collaboration and Performance Improvement
Analyzing supplier data identifies improvement areas, fostering collaboration and negotiation for better terms through The Owl’s supplier portal.
Cost Savings Opportunities Through Data Analysis
Analyzing supply chain costs identifies opportunities for expense reduction, fostering effective navigation through growth, competition, complexity, regulations, and digital transformation.
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Overall, data analytics can help supply chains become more efficient, responsive, and profitable. Using data for decisions gives companies a competitive edge, meeting customer needs more effectively in the marketplace.
When Data Analytics is Used
Companies consider data analytics in supply chains based on industry, size, and digitalization, at various development stages. Here are some common scenarios where companies might start to consider using them in their supply chain:
- Rapid growth: Companies that experience rapid growth may struggle to keep up with changing demand. By using data analytics, companies can gain greater visibility into their supply chain operations. This makes it easier to identify bottlenecks, inefficiencies, and make data-driven decisions to optimize their supply chain.
- Competition: In highly competitive industries, companies use it to gain a competitive edge. By analyzing data on supply chain operations, companies can identify opportunities to reduce costs, improve efficiency, and enhance customer satisfaction. This can help them stand out from their competitors.
- Increasing complexity: As supply chains become more complex ,it helps them manage the growing amount of data and gain insights into their operations. With data analytics, companies can gain a holistic view of their supply chain. This can help them monitor things like supplier performance, inventory turns, and identify areas for improvement.
- Regulatory Compliance: In industries with strict regulatory requirements, companies may need to use data analytics to ensure compliance with regulations. For example, in the food industry, companies may need to track and trace products from farm to table to ensure food safety. By using data analytics, companies can ensure compliance with regulations, reduce the risk of recalls, and enhance customer trust.
- Digital Transformation: As companies undergo digital transformation, they may consider using data analytics to optimize their supply chain operations. By integrating it into their supply chain, companies can gain real-time visibility into their operations, make data-driven decisions, and improve overall efficiency.
In summary, there are several scenarios where companies may start considering the use of data analytics in their supply chain. Data analytics can assist companies in navigating growth, competition, complexity, regulation, or digital transformation. Additionally, they provide operational visibility, optimizing supply chains, improving performance, and cutting costs.
At The Owl, we help manufacturing companies get the most out of their supply chain with our supply chain performance platform. Our team leverages data, insights and actions to track and align key supply chain KPIs with projected business outcomes.
The Owl is a platform made by supply chain professionals, for supply chain professionals. To see how our solution works, click the link below.