Analyst Insight: Companies that provide executives and top-level managers with insights into business-level and operational metrics are better positioned to improve supply chain performance. The ease with which this knowledge can be managed also matters: executives are often short of time or skill to create and properly execute complex data analysis or time-consuming reports. Best-in-Class companies are 64 percent more likely to have the drill-down capability in their supply chain BI tools to determine causes of business challenges (root cause analysis). These capabilities help top managers obtain a comprehensive view of their business, and make more encompassing estimates of business risks and opportunities.
- Nari Viswanathan, vice president & principal analyst at Aberdeen Group
In the context of today's complex demand-supply networks, in which visibility into key performance indicators across the entire network is key to business success, companies have begun focusing more strongly on their supply chain business intelligence capability, as a key enabler of strengthening or regaining control over their supply chain networks. With global supply chains involving more suppliers, customers and intermediaries today than ever before, managing supply-chain-wide performance effectively is critical to business success. Today, many companies still do not have timely visibility into the critical processes and metrics in global supply chain management, which often prevents them from making better supply chain decisions. In this context, having superior supply chain BI capabilities can differentiate top performers from those with less efficient and more costly supply chain processes.
In today's networked supply chain environment, collaboration with upstream and downstream supply chain partners is critical. Best-in-Class performers are more likely to be proactive in their supplier relationship management by utilizing a performance-based approach. This can entail performance-based service level agreements and incentive-based payment schedules, which not only allows these companies to make their supply chains more cost-efficient but also make it easier to choose the right suppliers and reward them for improved quality, faster delivery and increased reliability.
When asked how companies plan to improve Operational Business Intelligence software capabilities, responses included:
• Improve data quality and timeliness of status messages - 66 percent
• Enhance analytics capabilities - 56 percent
• Add warning alerts if actual events deviate from plan - 46 percent
• Incorporate additional status events - 40 percent
• Increase the number of trading partners providing status information - 40 percent
• Add escalation policies to help manage alerts - 30 percent
Supply chain analytics (e.g., dashboards showing on-time versus late shipments along with detailed shipment information, charts and graphs with information on current shipment location and accumulated landed costs) are contributing to more effective decisions, improving both the quality of supply chain decision-making and time-to-response.
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