Supply Chain Intelligence (SCI) is a relatively new term. It
was created to help people like me understand the relationship between the
three B’s: Business Intelligence (BI), Business Analytics (BA) and
Benchmarking.
It is portrayed as the addition of external performance
metrics to a BI/BA framework. But if you are like me, this is only marginally
helpful in understanding how these components come together to strengthen a
supply chain. So, let’s break this down
a bit and take it a piece at a time.
BI has a goal of connecting data from different systems and
repositories across the supply network to all users to help spot potential
problems and /or opportunities.
BA takes BI one step further by making extensive use of
advanced analysis and decision making techniques to support a sense and
response framework. SCI, then is the
combination of BI/BA and supply chain benchmarks. It offers the power of BI/BA with the ability
to compare performance to external metrics.
Pretty cool! While
I’m sensing, analyzing, responding and executing changes across my supply
network, I can also be comparing my metrics against best-in-class benchmark
metrics to see where and by how much I need to improve my performance.
At this point, you may be asking, “Where does SCI drive
value in the supply chain?” Well, the answer depends on the characteristics of
your supply chain. Generally, SCI:
- Lowers transportation costs
- Improves carrier performance
- Identifies sources of material cost variance
- Reduces lead times
- Pinpoints out-of-compliance shipments
- Identifies inventory excesses and shortages
across the global network
- Optimizes safety stock – quantity and placement
- Decreases total end-to-end supply chain costs
- Improves supply / demand balancing
- Helps balance customer cost versus service
tradeoffs
The real leaders in supply chain
performance are working with BI/BA tools now to improve their execution. Adding benchmark metrics to the equation
brings capabilities to a new level, and this is explored in more depth in the
new Supply Chain Consortium Report, Supply
Chain Intelligence - The Power of Combining Analytics with Benchmarks.
Does your company have SI? How do you see this new
intelligence benefiting your business strategy?
Go!Go!Go!
Jim
More Resources
More Supply Chain Benchmarking and Best Practices Resources
Learn more about the Tompkins Supply Chain Consortium
Learn more about Supply Chain Intelligence