Over past few years, BI has been used in many business functions to increase the efficiency, to improve decision making and instant identification of opportunities. But Supply chain Management is one area where the use of BI is most effective.
Supply chain management process is basically very complex by nature. It has processes like purchasing, procurement and inventory management, as well as activities like distribution, transportation and logistics must be flawlessly coordinated.
The data of Supply Chain can come from internal applications, external ones which are managed by outside partners or the data from the web. This data can be converted into timely, valuable and relevant information which can be used by the supply chain operators. This will eventually enhance efficiency, cost effectiveness, profitability and customer satisfaction.
It becomes particularly important when companies continue to globalize and expand their businesses across different geographies. Different currencies, cultures and regulations make it difficult to ensure rapid communication and collaboration among all partners. But BI can help ease these issues and enable smooth supply chain operations across the globe.Benefits of BI in Supply Chain:
- Enhance Workflow design and other strategic planning activities:
2. Improved collaboration and communication with all key stakeholders:
Use of BI will enable sharing of appropriate information to different stakeholders at the right time. This will decrease the communication gap between the stakeholders.
3. Track tactical processes and identify breakdowns before they impact fulfillment:
The processes which are of prime importance can be monitored and any breakdown in it can be easily identified before they impact the fulfilment.
4. Accurate measurement of performance of supply chain partners:
As BI can handle real time data, it helps in accurate measurement of different parameters which contribute in performance measurement.
5. Improving cost effectiveness:
By using right information, one can take business decisions which will reduce the overall cost.
6. Business Intelligence can set defined data thresholds which can be used to generate real-time alerts when critical conditions arise. Subsequently, this information can be leveraged to generate pre-defined automated alerts, thereby eliminating the need for manual action from supply chain personnel
KPI’s for Supply chain Management:
- Carrying Cost Of Inventory
- Inventory Turnover
- Order Tracking
- Inventory to Sales Ratio
- Units Per Transaction
- Rate Of Return
- Order Status
- Inventory Accuracy
- Back Order Rate
- Perfect Order Rate
- Logistics Cost per Customer
- Order Picking Accuracy Rate
- Warehouse Shrinkage
- Storage Space Utilization
Company profile: DMA is a national food service distribution company founded in 1986 which provides supply chain services to multi-unit restaurants. With the annual revenue of $3 billion, DMA distributers purchase products from hundreds of brands like Coca-cola, Kraft, Kellogg’s etc. and distribute them to leading restaurants like Potbelly, PF Chang’s and Famous Dave’s.
Problem: DMA’s supply chain efficiency was reduced due to the expense of extra deliveries and customer pick-ups. This problem mainly occurred because of non-scheduled product purchases the customer made.
Solution: DMA partnered with a BI solution providing company to design reporting that would identify occurrences of non-scheduled product purchases that result in extra deliveries and customer pick-ups.
The report helped to identify that certain stores were not building orders in an effective manner where products were either missing from orders or ordered in the wrong quantities. This resulted in extra deliveries or would call pick-ups to ensure an adequate supply. These stores were guided to make better use of the BI tools within the order entry system which reduced by 50% the time it took to assemble the orders with improved accuracy.To learn more about how BI can help in the Supply chain domain and request a live demo, get in touch with Helical Insight Log on to www.helicalinsight.com