Why Data Matters at Every Step of the Supply Chain

fewfwfwqefqwData is quickly becoming the best friend of businesses of all shapes and sizes. In fact, over 80 percent of executives say they believe their spending on data to be a success. If something can get that many business leaders on board with it, you know it’s something special. The universality of data is part of what makes it so appealing. There’s almost nothing that can’t be made better by backing it up with data. Supply chain management is certainly no exception to this rule. Data is actually crucial at every step along the way.

Planning and Product Design

So, you think you have a great idea for a new product. How do you know it’s a great product? What’s your market niche and potential demand? How many units should you expect to sell? If you’re approaching these questions without hard data, you’re simply speculating. And there’s no place for pure speculation if you want to be highly competitive in the business world. During the planning and design phase, data can help you determine the viability of a product based on past performances.

Sourcing and Procurement

Sourcing and procurement are incredibly important—but often overlooked—aspects to the supply chain. This stage of the process revolves around getting the necessary parts and materials needed in order to put the good together. Data can play a major role in this phase. For instance, you will want to get the best price possible for your raw materials. There are many factors that can influence this—such as time of year, country of origin, or natural disasters. An in-depth data analysis can show when it’s a relatively good or poor time to purchase raw materials. Saving a few cents on certain parts might not seem like a big deal. But if you’re buying millions of those parts, it adds up very quickly.

Production

The production stage involves everything that goes into actually putting the product together. This includes building the item, testing it, packaging it, and actually getting it ready for consumers. Data is certainly important for the testing aspect of production. If your product doesn’t actually do what it claims, or only does it sometimes, you’re going to upset your customers. And if you do this too drastically, you won’t have customers for long.

Retail

Finally, the part of the chain that actually engages with customers. Just because the initial steps have been taken care of doesn’t mean there’s no more need for data here. Sales data analysis is incredibly helpful for supply chain management. You need to know what products are selling and which ones aren’t doing so well. But you don’t just want this information. You need it delivered in real-time, with categorization by region, city, and store. All of these points will help you to increase sales with current and future products. Plus, all data collected from sales can then be used in order to make more accurate sales projections in the future.

Order Fulfillment

Logistics is one area that thrives from more data analysis. Whether it’s B2B or B2C, order fulfillment can be radically improved by working with data. At its most basic level, logistical operations can be optimized by acting on data-driven insights. It might be improving warehouse management, or just showing drivers how to get better gas mileage. Either way, there are many ways order fulfillment can be overhauled through data.

Few industries and job fields should shy away from the use of data to improve operations. Supply chain is one area that has the great potential to benefit from utilizing data. These are just some prominent examples of why you should integrate data into every step of the supply chain.

In the infographic below you can see the advantages of a data-driven supply chain strategy.

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