One of the biggest challenges facing many companies is figuring out how to optimize their supply chains. For obvious reasons, they want to strike a balance between keeping costs down and making sure they have the resources required to continue to operate. As became evident during the early months of the COVID-19 outbreak, supply chains, especially global ones, can be tricky beasts to tame.
Maintaining the right balance between efficiency and resilience is challenging even in the best of economies. One solution many enterprises now use to stay nimble in the face of evolving circumstances is Big Data.
By using computing power, algorithms, statistical methods, and artificial intelligence (AI), a company can condense the massive amount of available information about supply chains into comprehensible insights. That means making decisions quickly and without sacrificing optimization or resiliency. Let’s take a closer look at this trend and what it might mean for your operations.
What Can Big Data Do?
Computing resources can be focused on a handful of supply chain-related issues. These include jobs like:
- Forecasting supply and demand
- Proactive maintenance of infrastructure elements like warehouses and transportation
- Determining how to best stow freight
- Making pricing and ordering decisions
- Inspecting items and identifying defects
- Deploying workforce members, such as dockworkers and truck drivers, more efficiently
Suppose you run a consumer paper products company. You may need to scour the world for the best total price for a wood sourcing shipment. This may mean using Big Data systems to collect information about prices down the road and halfway across the world. Likewise, the company would need to make decisions about whether the costs of transporting and storing the wood pulp would be effective. Similarly, they’d need to establish confidence that each shipment would arrive on time.
How to Build the Needed Big Data Resources
First, it’s critical to understand that taking advantage of big data is about more than just putting a bunch of machines to work. A culture needs to be established from the top down at any organization. This culture has to:
- Value data and insights
- Understand how to convert insights into actions
- Have access to resources like data pools, dashboards, and databases that enable their work
- Stay committed to a continuous process of improvement
A company needs data scientists and analysts just as much as it needs computing power. C-level executives need to be onboarded with the culture, and they need to come to value data so much that checking the dashboards, whether it be on their phones or at their desk, is a routine part of their duties. Folks involved with buying, selling, transporting, and handling items need to know why supplies are dealt with in a particular way.
In addition to building a culture, team members have to have the right tools. This means computer software and hardware that can process massive amounts of data, turn it into analysis, and deliver the analysis as insights in the form of reports, presentations, and dashboards. Computing power can be derived from a variety of sources, including servers, cloud-based architectures, and even CPUs and GPUs on individual machines.
Some companies even have embraced edge intelligence. This involves using numerous small devices and tags to track granular data in the field, at the edge of where data gathering begins. For example, edge intelligence can be used to track the conditions of crops. Companies in the food services industries can then use this data to run predictive analysis regarding what the supply chain will look like by harvest time.
What Are the Benefits?
Companies can gain a number of benefits from embracing Big Data as part of their supply chain analysis. By studying markets more broadly, they can reduce costs by finding suppliers that offer better rates. Predictive systems allow them to stock up on key supplies before a crunch hits or let slack out when the market is oversupplied. Tracking customer trends makes it easier to ramp up buying to meet emerging demand, driving greater profits.
Developing Big Data operations separates good businesses from great ones. With a more data-driven understanding of the supply chain, your operation can begin finding opportunities rather than reacting to events. By putting Big Data resources in place, supply chain processes can become more optimized and resilient.