Analyst Insight

Although tracking supply chain events is essential, the long-term goal should be much more narrowly focused than it is at present.  This forward-looking goal should be to turn information visibility into a competitive asset to uncover trends, root causes of problems, understand how costs accrue along the supply chain, and be able to respond timely to supply chain disruptions. In doing this, it is critical to ensure that the data used for analysis is accurate and complete and that the appropriate analytical tools have been put in place.
-Nari Viswanathan, research director at AberdeenGroup

When asked about whether they actually had the ability to find and access the needed global supply chain data to execute the decision-making process, participants in a recent study gave an alarming response: only 13 percent were fully satisfied with how efficient they were in finding the needed supply chain data. Event management plays an integral part in supporting this goal of finding the needle in the haystack.

The key points to be aware of with event management:

• What events are monitored currently? The top categories of supply chain events that are being frequently monitored include: raw materials arrival at supplier, supplier production, in-process events, trucking (haulage) events, and customs clearance events.  The majority of these events are manually monitored; automated monitoring is only just emerging.  In each of these categories, over 50 percent of respondents report manual tracking while only 25 percent (or less) report having a tool to help them track the event.

• For the events monitored, how often are the data received accurate? Most of the companies face at least some data quality issues, which poses an impediment to efficient supply chain management. Best-in-Class companies are one and a half times as likely as Industry Average and almost three times as likely as Laggards to report that data received during their event monitoring process is accurate more than 80% of the time.

• Avoiding information overload. A common deployment mistake is to publicize events by setting e-mail alerts for these milestones. Many companies that gain the most value from event management solutions work hard to minimize the number of e-mail alerts used in order to prevent alert overload, which can drive staff away from using the system. Instead, they become masters at using exception reports and on-line task sheets to manage activity.

The Outlook

Event management needs to be considered as a key ingredient of any technology implementation in the supply chain, as this is the area which has human interaction requirements. In 2008, expect to see companies deploying and customizing event management platforms that support service-oriented architecture. The visionary companies will execute workflows based on exception conditions and the overall marketplace will focus on exception reporting.