Key among the developments dominating headlines in 2021 is the global supply chain crisis, causing widespread shortages of fuel, fresh produce, and everything in between.
According to research by McKinsey, companies can now expect supply chain disruptions lasting a month or longer to occur at least every 3.7 years. Given the choppy nature of the global pandemic recovery, it seems clear that serious supply chain issues will continue well into 2022 and beyond.
One solution that has been growing in impact is the use of external or alternative data. It’s being deployed to help businesses and financiers navigate complex realities and uncertainties, and guide decision-making. From geolocation data to satellite imagery, there’s a near-endless supply of publicly available information from the internet.
Anyone can look up publicly available data throughout the supply chain, including manufacturing plants details, tracking numbers and licensing information. This intelligence can be turned into a gold mine of opportunity for companies looking to assess their supply chains.
Today’s complex global supply chains make it tough for businesses to acquire visibility into their upstream processes. A survey by logistics firm Geodis found that 62% of companies had limited supply chain visibility, while only 6% reported full visibility. So it’s no surprise that more organizations are turning to alt-data to uncover much-needed hidden insights and predict any potential delays or shortages.
In a time of global instability, it’s also not surprising that demand for supply chain alt-data is on the rise from hedge funds and other investors. Savvy financiers are increasingly using this information to understand their exposure, vulnerabilities and potential risks and losses.
They’re also able to use alt-data to help understand the demands of customers. This includes using web-based data to determine customer sentiment around products, including country of origin and whether they’re made in an ethical and sustainable manner. Details as granular as color preferences can be used to aid in production decisions.
The term “alt-data” encompasses all information gathered from non-traditional sources that’s utilized to inform financial and business decisions. Following are some of the most common types of alt-data used to monitor supply chains today.
Sometimes what’s right in front of us can offer the most effective solution. Accessing huge amounts of public web data may be a mission that requires a great deal of expertise and time, but with today’s innovations in data technology, the task becomes much simpler and faster.
Looking ahead, we can expect more organizations to wake up to the potential of using supply chain-focused alt-data to remove risk from the equation, outpace their competition, and build resilience in an increasingly volatile business environment.
Omri Orgad is managing director, North America with Bright Data.
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