5 Signs that Your Business Needs a Supply Chain Data Analytics Strategy

  • May 24, 2023
  • | 34
In today's rapidly evolving business landscape, data has emerged as a powerful driver of growth and efficiency. With external factors like the pandemic, inflation Ukraine war, and now the recession, supply chain disruptions and demand swings are getting more and more frequent. Not to mention the challenge managing logistics, inventory, and supply operations has become.? This being the case, the supply chain, in particular, is an area where effective data utilization can provide significant advantages.?? Implementing a supply chain data analytics strategy is a crucial step for businesses looking to enhance their operational efficiency, improve decision-making processes gain a competitive edge, and boost their overall supply chain management practices.?? But the sheer amount of data produced by a supply chain can seem overwhelming, so leaders must take the right approach when attempting to use data to improve their operations. Also, determining the ideal timing for implementing such a strategy can significantly impact its effectiveness and success.?

Data-driven Supply Chain: An Overview?

A data-driven supply chain is a strategic approach that leverages data and analytics to enhance visibility and decision-making and predict production and inventory changes closer to real-time.?? It involves collecting, analyzing, and utilizing relevant data from various sources to gain insights, optimize operations, and drive continuous improvements. By harnessing the power of data, organizations can achieve greater efficiency, responsiveness, and competitiveness in their supply chain management practices. A data-driven approach generally uses newer data sources, like AI, to make predictions.?

Why Do We Need Analytics in Supply Chain?

As stated before, external factors are a major contributor to disrupting the global supply chain. Moreover, the traditional modes of supply chain management are proving to be subpar in today?s hyper-connected virtual environment.?? As a result, companies are also leaning towards a more digitized approach to maneuver their supply chain process. According to a Gartner survey, 79% of the executives have developed and implemented training programs to facilitate advanced analytics adoption.? ?Supply-chain leaders know that current methods are getting outdated and need to change. So, business heads are taking steps in that direction and shifting towards Supply chain analytics services to get data-driven insights. This Report by McKinsey was a clear representation of the growing demand for analytics and AI in the supply chain. The report stated that four out of five supply chain leader plans to use or are already using some sort of analytics for their operations.??

When to Implement a Supply Chain Data Analytics Strategy?

There are several elements that act as an indicator for your business to start implementing a supply chain data analytics strategy. The key decision makers should be on the lookout for these signs for effective and timely adoption of Supply chain analytics services.?

Supply chain maturity??

Assessing if your supply chain is established enough is an important factor in deciding when to implement a data strategy.??

If your supply chain processes and systems are already well-established and stable, it may be an appropriate time to introduce a data strategy.?? A mature and established supply chain provides a strong foundation for data integration and analysis, making it easier to carve out insights and promote improvements based on the data-driven approach.?

Data silos hampering effectiveness??

Data silos often arise due to fragmented systems and processes that hinder the flow of information between departments.??

  • Supply chain analytics is crucial in breaking down data silos within organizations.??
  • It enables the integration and analysis of data from various sources, departments, and systems by leveraging advanced data analytics techniques.??
  • Also, by unifying the data and breaking free from linear supply chains, analytics in the supply chain provide insights into key performance indicators (KPIs) such as inventory levels, order fulfillment, lead times, and supplier performance.?

Availability and Quality of Data??

Before implementing a data strategy, it is crucial to evaluate the availability and quality of your existing data. The effectiveness of your supply chain analytics strategy with largely be dependent upon data completeness, accuracy, and reliability.?? If you have reliable data sources and systems in place, it is a good indication that your supply chain is ready to leverage data effectively.?? However, if data quality is lacking or inconsistent, it may be necessary to invest in data cleansing and integration efforts before implementing a comprehensive data strategy.?

Availability of Technological Infrastructure?

Another tell-tale sign that your business to ready for a holistic supply chain data analytics strategy is to evaluate your existing technological infrastructure. Implementing a data strategy often requires robust IT systems, data storage capabilities, and analytical tools.??

Hence, having a good IT infrastructure can be an indicator of your supply chain data analytics strategy readiness.?? Similarly, if your systems are outdated or lack the necessary capabilities, it may be necessary to invest in upgrading or implementing new technologies before embarking on a comprehensive data strategy.?

Getting Competitor Advantage ?

The need for analytics integration in the supply chain is also largely dependent upon the industry trends and competitors' position in Supply chain analytics services.??

  • Constantly monitor your industry trends and analyze the viability of data analytics and digital transformation within your industry to make an informed decision.??
Although, in today?s climate, almost every industry is racing towards data analytics and data-driven insight generation. Likewise, closely monitoring your competitor's activities can also give you an understanding of your need to adopt an analytics strategy. If your competitors are aggressively focusing on supply chain analytics, then it might be time for you to do so.?? Also read - Top 5 Manufacturing Supply Chain Analytics Use Cases?

Wrapping Up?

Technology makes it possible to know essentially everything about your vendors and processes, but it?s easy to get lost in the information overload. Data should assist businesses in handling any disruptions and delivering powerful solutions for logistical issues, consumer behavior, inventory management, or any other business function.? A data-driven supply chain empowers organizations with actionable insights, visibility, and agility required to navigate the complexities of modern supply chain management. So, if you?re also experiencing the above signs I your supply chain, then opting for Supply chain analytics services would be the way to go.?? Companies such as Polestar Solutions are always on the lookout for a challenge and are using their years of expertise in transforming and automate the supply chain processes for their clients.??