Data led supply chain management can cure supply chain risks
Sportswear, flat-pack furniture, mobile phones, and car makers have all reported supply chain disruptions that led to increased production costs in 2022. The supply chain issues, triggered by the Covid-19 pandemic and then further exacerbated by conflict, have led to a period of inflation. Jointly these events demonstrate that supply chains are living through a period of disruption. As organisations look to manage cost inflation and improve their sustainability, a data-centric approach to supply chain management has become critical.
Vulnerabilities in the supply chain have been exposed by the global disruptions of the 2020s. And across the healthcare and life sciences sector, many of the weaknesses first revealed in the pandemic remain in place.
If left unchecked, these issues create worrying costs for organisations, as has already been seen in other sectors; One major retailer reported a drop in revenue of $1 billion, the automotive sector produced 5 million fewer products, and a leading global technology company reported a loss of $4 billion in one quarter.
Data led supply chain management reduces cycle times and minimises shortages
Research by Tableau finds that 67% of supply chain managers continue to use spreadsheets as their main management tool. Using spreadsheets leads to static data that is usually shared via email, which means stakeholders in the organisation are unable to collaborate. With global supply chain vulnerabilities headline news, senior leaders in the healthcare and life sciences sector will be increasing their focus on the supply chain. Executive teams want to reduce supply chain cycle times, achieve greater sustainability, and minimise shortages.
Our research finds that 55% of supply chain managers consider data management one of the two biggest barriers to adopting integrated analytics. Yet 39% say that improving supply chain visibility with new technology is among their top two priorities in order to gain more control of the supply chain.
Clearly, the healthcare and life sciences sector needs to think about how they use data more effectively. Of supply chain managers surveyed by Tableau,
state that forecasting and modelling is difficult. The demand for a change in supply chain management is evident
of managers want to improve recall processes, and the same percentage of managers want to guarantee on-time deliveries
Modernising the chain through data led supply chain management
By incorporating data and analytics into the supply chain, healthcare and life sciences, organisations can benefit from augmented capabilities. This will release data into dashboards and tools that allow supply chain managers and stakeholders to walk the factory or distribution centre floor but have the data available to them via a mobile device, which enables collaboration. Embedded machine learning will predict shortfalls in stock; Slack integrations allow the supply chain manager to warn sales teams, who can then change their focus to meet KPIs. Supply chain managers can use predictive analytics to stay ahead of potential disruptions.
Using the Tableau Einstein and Ask Data tools, it is possible to consider the financial and environmental risks of certain suppliers, consider the average size of previous orders and then make an informed decision on whether to place the order. For example, it may cost more to source a component from Canada than China, but data can inform the organisation of the longer-term cost savings from being able to keep production running and meeting customers' expectations for example.
This same approach can be used on the production floor, too; by collecting data on all the devices used, it is possible to predict disruptions to the manufacturing process and then, again using Slack, message the production manager and request a change in plant maintenance schedules. All of these small adjustments to the supply chain will add up to significant savings and increased sustainability.
A lack of change and modernisation to supply chain practices added additional vulnerabilities to the supply chain. With global impacts such as the climate emergency, conflict, geopolitical issues and the skills shortage expected to continue, organisations face increased cost pressures on their supply chains. A data-centric approach will create a supply chain that is cost-effective and adaptable to change.
3 key benefits of data led supply chain management
- Seamless access to data leads to a major increase in collaboration
- Predictive analytics allow you to stay ahead of potential disruptions
- By incorporating data and analytics into the supply chain, healthcare and life sciences organisations can benefit from augmented capabilities