What You Don’t Know
Can Hurt You—So Be
Supply Chain Smart
Frank Tomany is director
of product management
at Manhattan Associates
( www.manh.com), a
provider of supply chain
planning, optimization
he recent turbulence in the financial markets
highlights the damaging effects of uncertainty, stemming from the lack of reliable
information from veiled market participants such as
hedge funds and private equity firms and from off-balance-sheet transactions at leading institutions.
This serves as a stark example of a business system deprived of good and timely information. This,
in turn, has forced companies to move toward
building more transparency into their information
systems so everyone is on a level playing field and
nobody is at an advantage or disadvantage.
In most companies, the supply chain is viewed as
a mission-critical system. In the very best performing
companies, the supply chain is seen as a strategic
weapon with which to club the competition and
drive shareholder value. The type of meltdown experienced in the financial sector should have companies
begging the question: Are we getting all the necessary
intelligence from our supply chain system to make
the best decisions for our business?
There are many individual things you need to do
well in order for your supply chain to become a competitive weapon, but in the end they all boil down to
having the optimal supply chain design combined
with ruthlessly efficient execution. You need to combine “information” (the communications or receptions of knowledge) and “intelligence” (the ability to
apply knowledge to manipulate one’s environment
as measured by objective criteria). This combination
of information and intelligence is what is commonly
referred to as supply chain intelligence. Supply chain
professionals can leverage the power of this insight
to unlock information they previously could not
access, giving their companies a tremendous competitive advantage.
T
One Person’s Data is Another
Person’s Intelligence
Companies’ supply chain systems create an impres-
sive amount of data. However, there’s not any value
in loads of data if you can’t access it or understand
it. The biggest obstacle in managing this amount of
data involves identifying the information that mat-
ters and then seeing that the same meaningful infor-
mation gets to all the individuals who need it to
make the best decisions for your company.
Some of the more common challenges that companies face when it comes to business intelligence
for the supply chain are:
• What is just operational reporting and what is
true business intelligence and analytics?
• Which data is needed in real time and which
data can be updated less frequently?
• What data should be retained over time to
analyze and measure supply chain performance?
• Users don’t have to use business intelligence
tools to do their jobs, but they do have to use them
to do them more effectively. How do you get that
message across and incent them to use tools?
• Are the business intelligence tools easy
enough to use and yet powerful and flexible
enough to be worth using?
• Business intelligence typically relies on attribution and classification data on master (i.e. item)
and transactional (i.e. shipment) objects and will
not be useful if this data is absent or inaccurate.
True Supply Chain Intelligence Combines
Content with Capabilities
Supply chain intelligence is all about bringing
together content and capabilities. “Content” is all of
the data held in various data structures and the various predefined reports or views over that data.
“Capabilities” include all of the tools that allow
users to access the data and create new ways of
accessing the data (i.e. new “content”).
Examples of content include:
• Picking data
• Receiving data
• Shipments data
• Labor performance data
• Transportation invoices data
• Predefined reports and analysis views
• Predefined metrics (sometimes referred to as
key performance indicators or KPIs)
• Predefined events/alerts
The key with data is organizing it into subject matter areas familiar to supply chain users. There are two
important types of data within each of these subject
