Use Cases for Supply Chain Analytics
Ready to see how supply chain analytics works in real life? This chapter showcases some areas where analytics can drive supply chain efficiency. I set out the key benefits, identify the
data owners and data sources, and list the metrics you could use in each scenario for measuring performance and making decisions.
This chapter refers to the list of common supply chain metrics from Chapter 3, so you might want to glance back at that chapter as you go along.
Demand Forecasting One of the most important tasks for any retailer is to accurately predict consumer buying patterns. This is especially true around seasonal holiday periods. By identifying the major buying patterns, the organization can gain much greater control of inventory and streamline supply chain operations. Buying pattern analysis is only one part of demand forecasting, and input from marketing systems helps combine this data with identifiable trends within the market to provide more context for decisions. Table 4-1 highlights how the demand forecasting process benefits from the use of analytics, who benefits in the organization, and the sources of information that are used as part of this particular use case.
Chapter 4
IN THIS CHAPTER
» Applying analytics to different areas of the supply chain
» Discovering the benefits a business gains from each use case
» Listing the data owners and data sources for each use case
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Invoice Reporting Invoice reporting is of great interest to procurement and finance departments as well as supply chain operations. Procurement and finance managers want to know about expenditures by product, supplier, region, or date range. They want to know how quickly expenditures were processed and how often they were rejected (both of which affect the cash-to-cash cycle). Supply chain oper- ations want to know which trading partners are performing best.
TABLE 4-1 How Analytics Benefits Demand Forecasting Business Benefit from Applying Analytics Data Owner Data Sources
Example Metrics
Improve customer experience
Procurement
Buying director
Manager
B2B integration platform
Top trading partners by spend
Improve sales forecasting
Sales director
Manager
Enterprise resource management (ERP)
Total units sold by Average Sales Price (ASP)
Reduce lost sales Customer service director
Manager
Customer relationship management (CRM)
Quantity sold by channel
Reduce out of stocks
Product manager Marketing automation
Cycle time by product SKU/RMC
Maximize product price
CFO
Financial director
Product manager
Point-of-sale systems
ASP by SKU/RMC
Reduce lost, wasted, or written-off inventory (LWOE)
Sales eCommerce systems
Purchaser behavioral trends
Reduce inventory holding costs
Operations
Logistics
Procurement
Warehouse management system
Inventory turns by product SKU/RMC
CHAPTER 4 Use Cases for Supply Chain Analytics 33
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Table 4-2 highlights how the invoice reporting process benefits from the use of analytics, who benefits in the organization, and the sources of information for this use case.
Inventory Visibility Inventory visibility enables an organization to combine inven- tory data with other elements to evaluate supply chain perfor- mance. Consider, for example, a global vehicle manufacturer that has implemented and standardized on an ERP system across all its plant locations. The company requires improved visibility of inbound ASN transactions to improve efficiency of its Just-In- Time (JIT) production systems. With multiple suppliers frequently delivering to each plant, the company requires complete visibil- ity across multiple inventory locations. Table 4-3 highlights how the inventory visibility process benefits from the use of analytics,
TABLE 4-2 How Analytics Benefits Invoice Reconciliation Business Benefit from Applying Analytics Data Owner Data Sources
Example Metrics
Increase invoice visibility
Procurement
Buying director
Manager
B2B integration platform
Invoice accuracy
Improve supplier management
Supply chain director
Manager
Accounts receivable/ payable
Top products by invoiced amount
Improve invoice accuracy
CFO
Financial director
ERP Top trading partners by spend
Increase process automation
Operations
Procurement
ERP/MRP Perfect order fill rates
Improve bargaining position
Accounts payable
ERP/MRP Aggregate spend by supplier/customer
34 Supply Chain Analytics For Dummies, OpenText Special Edition
These materials are © 2017 John Wiley & Sons, Ltd. Any dissemination, distribution, or unauthorized use is strictly prohibited.
who benefits in the organization, and the sources of information that are used.
Partner Performance Reporting You want to know what your partners are doing and how well they’re doing it. That way you can develop deeper relationships with the high performing trading partners, and cut loose the ones
