Supply Chain Management
A supply chain is a system wherein there is an interplay among organizations and people, activities and information besides resources, all involved in moving a service or product from the supplier to the customer. The various activities within the supply chain complete the transformation of the raw materials into the finished products before their delivery to customers. The traditional supply chains will normally include diverse elements such as the suppliers and manufacturers as well as the wholesalers and retailers besides of course the customers. Analytics plays a critical role in the enhancement of the efficiency of the supply chain. Advanced analytics solutions help overcome various problems that crop up in a supply chain.
The Likely Challenges in a Supply Chain
With fast-paced globalization and technological progress it is not unusual to find companies reaching out far beyond their shores. This does bring about complexities and challenges to all global companies. Delays in the arrival of shipments causes inefficiency besides suppliers who do not live up to expectations and contractual obligations all end up causing an increase in supply chain costs. There are several challenges to the supply chain today and some of these are:
Advanced analytics solutions are necessary to solve these supply chain challenges.
Companies all over the world are now increasing their investment in analytics basically in order to overcome the challenges faced in the supply chain. This is because the supply chain function has the largest potential for both innovation and one’s competitive advantage. There has been a considerable improvement in business analytics over the years. Today Business Analytics is known in academic circlesto be in a position to offer support in decision making for diverse activities related to the supply chain. These relate to both tactical and strategic issues. It is on account of business analytics that companies are now able to bring about a reduction in costs while simultaneously being able to optimize their supply chains.
Improvement of Supply Chain Visibility
Today in order to improve the visibility of your supply chain there is a need for smarter logistics,one that can cope both with customers that are globally dispersed and the numerous supply chains that are spread all across the world. Only smart logistics will be able to monitor all these issues closely. In order to achieve an increase in the efficiency of your supply chain it will be necessary to enhance the basic metrics and its reporting since it is these that provide the requisite data for carrying out the initiatives in performance improvement while providing the necessary visibility of the activities of your supply chain. Only the use of control metrics that are driven by advanced analytics will be able to monitor the various critical events in real time and the Key Performance Indicators (KPIs). It is with the help of a combination with predictive analytics that the metrics will be able to make substantial savings in the areas that include the optimization of freight.
It is imperative that the volatility in demand that is steadily on the increase be tackled and inventory managed more efficiently. For this to happen it will be necessary to apply advanced analytics solutions to areas such as automotive, consumer goods, and retail so that forecast data is made available in real time. This will in turn enable accurate anticipation of demand and the monitoring of the policies of supply and replenishment so that inventory control is more efficient.
Tackling Cost Fluctuations
Cost fluctuations can be controlled by the optimization of the activities of sourcing and logistics. This is because the costs of the supply chain actually form the significant portion in the costs incurred by a company. Materials, logistics and sourcing are the key areas where the costs could be controlled with the help of intelligence made available from analytics. There are some excellent analytics programs that the managers of supply chain could use so that their sourcing strategy is improved upon.