Top 7 Tips for Utilizing Big Data to Optimize Supply Chains

Virtually all retailers use historic data (structured) to better understand customers and increase sales. During the last 10 years, the proliferation of digital channels has made consumers "hyper-connected," transforming them from data consumers to data producers. The result is two-fold: it has created more "siloes" for the retailer and an explosion of unstructured data.

 

With the supply chain being pivotal for retailers, any improvement will impact the sales or operational efficiency as well as the customer experience. The core objectives of retail supply chain organizations continue to remain consistent across the journey:

1.       Build efficiencies into the supply chain. Ensure a high-performance supply chain by enhancing productivity, collaboration, speed and visibility, and minimize time spent manually monitoring key events that require action or provide important information – for e.g. labor scheduling at distribution centers.

2.       Improve relationships with supply chain stakeholders. Improve relationships by providing visibility into events that affect stakeholders like vendors, suppliers, carriers, distribution, warehousing and customers.

3.       Be agile and proactive. Improve agility to respond to business dynamics and ensure a proactive response to business critical issues before they escalate. Use IT performance monitoring tools to identify and eliminate system performance issues before it becomes visible to stakeholders and affects retailers' operational efficiency.

 

Omnichannel retailers are entering into an exciting age of opportunity in supply chain data management. Retailers can leverage Big Data coupled with real-time tracking and analysis of both structured and unstructured data to build an intelligent, adaptive and highly responsive supply chain and gain end-to-end visibility at a network level.

 

Retailers must integrate all systems and explore ways to rapidly respond to supply chain challenges. For example, can the stock replenishment quantity of a particular SKU for a particular store be changed just a few hours before being loaded onto the truck at the warehouse? To achieve this, retailers must consider the data from a real-time demand management perspective.

 

Implementing advanced analytics and Big Data solutions can significantly help retail supply chain organizations improve both planning and execution. This includes:

1.       Advanced Planning and Scheduling. Gain end-to-end visibility and attain high-quality decision support to consistently achieve optimal performance. Reduce out-of-stocks and inventory issues that waste resources with accurate production plans and schedules.

2.       Improved Demand Planning. Leverage historical demand data with user-anticipated differences in order to get better results with each forecast.

3.       Improved Responsiveness. Manage the uncertainties of seasonality and new product introduction so decisions and scheduling are automated across complex dependencies.

4.       Intelligent Inventory Planning and Deployment. Use optimized, dynamic business rules, inventory policies and forecasts to consider consumption rates and inventory levels across the supply chain, applying replenishment rules.

5.       High Precision Replenishment Planning. Keep service levels high and costs low by harmonizing supply with demand internally and across the network of trading partners to have the right amount of product at the right time at the right place. This is crucial for omni-channel channel fulfillment (e.g. buy online pick-up in-store or BOPIS).

6.       Real-Time Supply Chain Execution. Live information processing enables improved agility and ability to act just-in-time on changing requirements such as fulfillment quantity, inventory re-routing, etc.

7.       Omnichannel Order Optimization. Improve on-time delivery, minimize the cost of expediting and contribute to program success.

 

While many ERP and packaged software vendors have made attempts to address these areas, none have done so holistically and consistently. This void leaves a significant market opportunity to apply these strategic processes to help retailer build an intelligent supply chain and better serve and support their customers.