The growing importance of supply chain analytics
by Randy LittlesonIf you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
There’s a new article at Technology Evaluation Centers (free registration required) talking about the current trends and growing importance of supply chain analytics. The article lists a bunch of capabilities - all of which are addressed by a Response Management system, by the way. What’s glossed over a bit, is actually the most important part - why? Why is there an increasing interest in these types of supply chain analytic capabilities?
The article accurately states that “organizations are trying to create a framework for top management to link corporate strategy and operations strategy.” This is a key challenge I’m seeing. With so many unplanned events happening every day across extended supply chains, organizations are struggling more than ever to ensure continuous execution at an operational level that is aligned with corporate objectives.
To deal with the influx of volatility, front-line decision makers must be able to act quickly. This means they are making literally hundreds of judgment calls each day. Each of these alone may not have material implications to the business - but in aggregate, they are quite material. How does the organization ensure that these decisions - which need to be made quickly to satisfy customers and avoid costly delays - are consistent with the objectives agreed to in the sales and operations planning (S&OP) process?
The key to doing this is ensuring that the decision support tools these front-line decision makers use have live scorecarding capabilities so that each proposed action alternative can be weighed against those corporate metrics before action is taken. This is critical - people need to be empowered to act quickly with confidence in the implications of their actions. This is the only way to ensure that tradeoffs made throughout the day are consistent with the goals of the organization.
