Role of Business Intelligence in Supply Chain
Supply chain management plays a vital role in the emerging world market. According to the Harvard Business Review, in 2018, the U.S. supply chain made up 37 percent of all jobs, employing 44 million people in the U.S. To stay competitive in the supply chain management business, you need to recognize the potential weaknesses of your organization and form ideas to overcome them. Business intelligence (BI) helps you identify potential risks associated with your business and enables managers to take timely corrective action. BI gives you the required organization and visualization of the data stored in your business’s data banks needed for insight into its patterns. In this blog, I am going to discuss why supply chain management needs business intelligence and how BI paves the path to the growth of your business.
Why supply chain management needs BI
- BI helps key decision-makers monitor internal inefficiencies and gives them the metric-driven insight to take appropriate actions to overcome these inefficiencies.
- BI tools, such as scorecards and dashboards, provide detailed breakdowns of reports on your company’s performance with many available metrics and KPIs. These help you monitor the progress of your company growth, like whether quarterly goals are achieved or not, as well as forecast future results based on your previous performance data.
- Since supply chain management involves many departments, there is a lack of visibility and lots of data spread across the departments. BI collects all of your company’s data into a single platform.
- With the detailed and specific data from every step of production, you can go through the process from transporting raw materials to delivering your final products to customers and strategically enhance each part.
Various aspects of BI in supply chain management
The supply chain comprises various elements, such as operations management, logistics, procurement, and IT. It acts like the wheels of a vehicle. If anyone of them fails, the entire vehicle cannot move. BI coordinate each aspect with the others and helps you to run a more successful business.
Demand and inventory management
It is crucial to supply the demands of and manage inventory for ever-changing customer behavior and market fluctuations. Poor demand forecasting and inventory management leave you with low profit margins and high supply chain costs. Many organizations are working hard to match market demands while hitting the profit goals, and BI makes it easier. BI provides an effective process by forecasting the insights and make your supply chain more efficient, enhance customer service, better inventory management, and optimized trade operations.
Distribution and communication management
Distribution is not just moving products from one place to another. It includes proper packaging, inventory, warehousing, and logistics. Overseeing the movement of goods and communicating their statuses with the necessary employees in real time is a tedious process. Proper distribution and communication, however, determine the longevity of an organization. With BI, companies can track and monitor the status of the orders and improve customer satisfaction with real-time updates. BI helps you monitor expenses like fuel cost, uncover supplier challenges, and identify new opportunities that result in increased profit and growth for your organization.
Supplier and vendor association
Integrating all systems into one helps companies run an effective and more profitable supply chain business. BI helps you to visualize all your data with key metrics in one place. With BI, you can bring products more quickly to the market, figure out which areas need improvement, eliminate a lot of wasted time and storage space, and boost productivity.
Forecasting
BI helps companies predict patterns and prevailing trends from their data. Improved knowledge of the market demand prevents them from overstocking. It also helps supply chain managers track shipments in real time and accurately predict delivery to customers, which improves customer service.
Bold BI’s business intelligence dashboards for supply chain management
With Bold BI’s supply chain management dashboards, you can achieve the objectives of your company by tracking the important KPIs (such as cash-to-cycle time, perfect order rate, customer order cycle time, inventory turnover), drilling down into the key metrics with a detailed analysis in every widget, and identifying the risks in your process and mitigating those risks with action plans.
Supply chain performance dashboard
The supply chain performance dashboard helps you track customer details, such as the customers’ city, product name, and delivery status. You can monitor the KPIs, like cash to cycle time, which shows the time it takes to convert inventory into sales. The days receivable outstanding, days payable outstanding, and days inventory outstanding cards help you dive into the financial and sales operation details.
Supply chain warehouse management dashboard
The supply chain warehouse management dashboard gives you details about inventory: the product availability, inventory days of supply, backorder rate, return rate card, and inventory carrying cost. With these metrics, you’ll know about the company’s performance, customer needs, operating costs, and ability to continue selling the products. By studying these visuals, decision-makers can devise strategies to function more efficiently.
Best practices in supply chain management you should know
- Having a proper governing council and regularly scheduled meetings to discuss objectives and strategies prevents the organization from deviating from its actual goals.
- Making use of technology helps you identify customer demand, predict future trends, identify the setbacks, and mitigate the risks.
- Compressing the cycle time will result in good customer service that will eventually earn you more customers.
- Aligning with key suppliers helps you understand each other’s goals and will create harmony among them. This will help you reduce the time and cost of processing purchases and improve responsiveness.
- Optimizing inventory creates a better flow of products and reduces the cost of storing inventory in warehouses.
- Reviewing policies and procedures at regular intervals helps you avoid bottlenecks and ensures compliance, efficiency, and profit.
Conclusion
I hope this blog post gave you a good overview of the role of BI in supply chain management. You can start to create your own dashboards in Bold BI by scheduling a free 30-minute demo with our experts. If you have any questions, please feel free to post them in the following comments section. You can also contact us by submitting your questions through the Bold BI website, or if you already have an account, you can log in to submit your question.
Originally published at https://www.boldbi.com on February 11, 2021.
