The supply chain is an essential part of every company’s operation. It ensures that products are produced in the right places at the right times with the correct level of quality. It also tracks the movement of raw materials to final manufacturing plants.
● Supply-Chain Analytics
What if this information is not available? What if there is no central source of information that any company can access at any moment? What if too many players in the supply chain are all moving at different speeds and in different directions? That’s supply chain analytics.
It is collecting, understanding, and reporting supply chain data. The aim is to identify and analyze the causes of troubling supply chain patterns and identify potential issues before they become problems.
The analytics also focuses on manufacturing, distribution, and consumption. There are two types of data collection: batch and real-time.
The batch supply chain collects data at regular intervals, usually weekly or monthly.
Real-time supply chain analytics covers a wide range of technologies, protocols, and methodologies to collect the latest data and provide insights in real-time.
Types of Supply Chain Analytics
It has different types, and each serves a different purpose. The types of analytics include:
Predictive analytics is the most common type of supply chain analytics. It uses historical performance data to predict future performance to help businesses better understand how their supply chains will perform in different situations.
It uses data from other sources, such as weather reports to provide insights into how a business’s supply chain will perform if certain events occur. It allows businesses to adjust before those events take place, which can help reduce the risk of unexpected delays or poor performance.
Descriptive analytics is used primarily for internal business analysis and reporting purposes rather than for predicting or prescribing actions that should be taken by the business based on its findings.
It involves analyzing a business’s supply chain structure to identify areas where improvements could be made and then developing strategies based on those findings that can be implemented over time to improve performance and increase efficiency.
Cognitive analytics involves using artificial intelligence and machine learning algorithms to analyze data and identify trends, patterns, and other helpful information. It can improve performance and reduce costs throughout the supply chain.
How Does Supply Analytics Impact Businesses?
There are several ways in which supply analytics impacts the business, as discussed below:
1. It Provides a Better Understanding of Risk
Supply analytics gives companies a better understanding of the risk involved in their supply chain. It shows them where there are gaps and weaknesses and allows them to take steps to mitigate these risks and increase the likelihood of success.
2. It Improves Supply Chain Management
Supply-chain analytics can also help companies improve their supply chain management. By tracking data over time, they can adjust and improve areas that are causing issues or bottlenecks.
3. It Reduces Costs
By identifying issues early on, supply chain analytics allows companies to take proactive measures to reduce costs and delays in the future.
4. It Increases Customer Satisfaction
Companies that use supply-chain analytics can identify issues before they become problems. It is advantageous as it helps them maintain high customer satisfaction ratings. They can also gain new customers through word-of-mouth advertising or referrals.
5. Increase Accuracy in Planning and Forecasting
With analytics, companies can be more accurate in planning and forecasting. It is especially true for companies that rely heavily on forecasts, such as the retail industry.
6. It Improves Collaboration
It allows for better collaboration between supply chain partners because it provides a common language and vision of the supply chain. It means a better understanding of roles and responsibilities, which makes it easier to work together toward a common goal.
7. It Improves Operational Efficiency
Improve operational efficiency by identifying areas where there are unnecessary costs or delays in the supply chain process. It allows them to revise their processes to be more efficient and reduce waste in the future.
8. It Helps Businesses Become More Competitive
Using it can help businesses become more competitive by allowing them to streamline their operations and increase customer satisfaction at an affordable price point, making them more attractive to potential clients and customers alike.