Management
Article | June 21, 2023
Data volume in supply chains is usually enormous. Analytics applied to the supply chain help make sense of the pile of information by identifying patterns and drawing conclusions.
Contents
1 Importance of B2B Supply Chain Analytics
2 Obstacles in Supply Chain Analytics Integration
2.1 Barriers in Collecting and Processing Data
2.2 Insufficient Technical Skills
2.3 Issues in Managing and Integrating Data
2.4 Inadequate Analytics and Insights Generation
3 Addressing Supply Chain Analytics Complexities for Better Decision-Making
3.1 Leveraging External Expertise
3.2 Enhancing Collaboration and Communication
3.3 Improving Data Quality and Governance
3.4 Developing Analytics Capabilities
4 Power of Successful Supply Chain Analytics Integration in Transforming Businesses
5 Conclusion
1 Importance of B2B Supply Chain Analytics
Supply chain analytics has become a pillar of contemporary business strategy, enabling organizations to leverage data insights and enhance vital supply chain processes. By utilizing real-time data analytics, businesses can streamline their supply chain operations, boost productivity, and increase customer satisfaction. With unparalleled visibility into key performance indicators, B2B supply chain analytics provide the opportunity to identify inefficiencies, reduce costs, and react swiftly to ever-changing market dynamics, streamlining the process for supply chain business analysts who manage supply data.
Leveraging the power of supply chain analytics tools is important for the success of modern businesses in the age of data-driven decision making. With the ability to optimize inventory levels, manage lead times, and reduce transportation costs, supply chain data analytics provides a competitive advantage that can increase the efficiency, productivity, and profitability of businesses of all sizes and in all industries.
2 Obstacles in Supply Chain Analytics Integration
Supply chain analytics integration has become increasingly critical for companies seeking to optimize their supply chain operations. However, several obstacles hindering successful implementation often complicate the integration process; hence, understanding and knowing them in advance is vital for smooth operations.
2.1 Barriers in Collecting and Processing Data
Effective data collection and processing are critical in generating accurate insights to drive supply chain analytics decision-making. However, it comes with challenges; the most critical obstacle is data silos, where data is stored in isolated systems or departments, leading to difficulties in accessing and integrating it. It gets more complex when different departments or partners use varied data formats or standards. Additionally, cleaning and processing data is also challenging, as it involves identifying and eliminating duplicates, inconsistencies, and errors that can negatively impact analytics accuracy.
2.2 Insufficient Technical Skills
Successful supply chain analytics integration depends heavily on technical skills and knowledge. Insufficient technical talent and expertise are significant barriers to successful integration. The integration process requires specialized technical expertise and the supply of skilled professionals with expertise in ETL, statistical analysis, knowledge of ML, IoT, SQL, and more in managing supply chain analytics Talent lacking technical skills cannot accurately interpret data, leading to ineffective
decision-making. Preliminary data analysis, processing, and visualization due to a lack of technical expertise results in suboptimal decision-making, which can be costly for businesses.
2.3 Issues in Managing and Integrating Data
Data integration combines data from various sources and formats to create a unified view. However, businesses face data governance, quality, and standardization issues, resulting in incomplete or inconsistent data. Lack of accurate information reduces the efficiency of supply chain analytics and impacts decision-making. Additionally, data management is complex, and business face difficulties creating effective data management processes, resulting in problems related to storing, retrieving, and updating data.
2.4 Inadequate Analytics and Insights Generation
Obtaining valuable insights from enormous data collected during the supply chain process requires advanced analytics tools and technologies. Many businesses, however, continue to rely on traditional reporting methods, which limit the range and complexity of insights generated. The lack of expertise in data analysis and visualization can lead to poor interpretation and use of data, resulting in suboptimal decision-making. In addition, businesses experience difficulty identifying relevant data sources or may struggle to establish the necessary data governance frameworks to ensure data quality and accuracy.
3 Addressing Supply Chain Analytics Complexities for Better Decision-Making
Supply chain analytics can provide valuable insights, but the complexities involved in analyzing and interpreting data can be a significant hurdle. Learning the strategies for addressing these complexities to improve decision-making in supply chain management has become essential.
3.1 Leveraging External Expertise
Leveraging external expertise can be a powerful strategy for addressing supply chain analytics complexities related to collecting and processing supply chain data during integration. External experts bring specialized skills, experience, and knowledge that may not be available in-house, enabling organizations to overcome talent shortages and expand their capabilities. Furthermore, consultants, data scientists, or technology providers provide an objective viewpoint on the organization's data and processes, identifying areas for improvement and optimizing performance. By collaborating with external experts, organizations can access the latest tools, technologies, and best practices, ensuring that their supply chain analytics are up-to-date and relevant.
3.2 Enhancing Collaboration and Communication
Enhancing collaboration and communication can effectively address the challenge of insufficient technical skills in thriving supply chain analytics integration. By promoting cooperation and cross-functional communication, organizations can leverage the skills and expertise of team members from various departments to fill gaps in technical knowledge. This approach can also help to break down data silos and improve data sharing and integration. In addition, collaboration and communication can facilitate knowledge transfer, enabling team members to learn from one another and develop a more comprehensive understanding of the supply chain analytics process. Ultimately, this can lead to improved decision-making, as a more skilled and knowledgeable team can generate more accurate and insightful analytics.
3.3 Improving Data Quality and Governance
Businesses ensure accuracy, completion, and up-to-date data by establishing standardized processes and protocols for collecting, storing, and analyzing data. Data quality checks, including data cleansing and normalization, can help eliminate errors, redundancies, and inconsistencies that can negatively impact the accuracy and usefulness of analytics. In addition, effective data governance, including establishing data ownership, security, and privacy policies, helps ensure that data is managed and shared appropriately across the organization. As a result, it reduces the risk of data breaches, compliance violations, and other data-related issues, ensuring that organizations have access to reliable data for better decision-making.
3.4 Developing Analytics Capabilities
Developing capabilities significantly help organizations overcome inadequate analytics and insights generation challenges in analytics integration. Investing in advanced analytics tools and platforms like technical skills, data infrastructure, and advanced supply chain analytics techniques help businesses generate real-time, accurate, and actionable insights from collected data. Developing analytics capabilities requires creating a culture that values data and analytics, establishing robust data governance frameworks, upskilling the workforce and creating cross-functional teams collaborating on data-related projects. In addition, it helps businesses gain a competitive advantage.
4 Power of Successful Supply Chain Analytics Integration in Transforming Businesses
Effective supply chain analytics integration is revolutionizing business operations. Real-time and supply chain predictive analytics have helped businesses gain unmatched transparency in their supply chains, enhance critical processes, improve operational efficiency and customer satisfaction, and experience revenue growth and profitability. The ability to identify inefficiencies and supply chain optimization opportunities enables businesses to effectively allocate resources and reduce expenses. In addition, successful supply chain analytics integration enables businesses to respond quickly to changing market dynamics, optimize inventory management, and strengthen the resilience of their supply chains.
Businesses are leveraging the power of big data analytics to disrupt and transform supply chain at all levels. The concept of data, which was once a fundamental component of digital supply chain transformation, is now revolutionary. Therefore, it is essential to achieve advancements in supply chain analytics integration and management.
5 Conclusion
With technological and data analytics advancements, businesses can utilize real-time data insights to make data-driven decisions, optimize supply chain processes, and improve customer experiences. Integration of supply chain analytics is crucial for supply chain businesses of all sizes. Utilizing supply chain analytics software can further streamline integration as well as enhance data analytics and supply chain management.
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Supply Chain
Article | August 17, 2023
The rapid growth of e-commerce continues to create new challenges for retailers as they plan distribution strategies. One of those challenges is managing the high volume of returns. One in three shoppers returns items, and more than half read a company’s returns policy before making a purchase. Retailers lose $50 billion annually due to inefficiencies in processing returns, and distribution centers handling returns need 15% to 20% more space than a traditional facility.
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Warehousing and Distribution
Article | July 11, 2023
Unlock operational efficiency and deliver exceptional customer service with a WMS. Learn how cloud-based WMS improves control, enhances customer service, and prepares businesses to develop & succeed.
Contents
1. Importance of Warehouse Management Systems
2. How Warehouse Management Systems Optimize Operations
2.1. Productivity Tracking
2.2. Inventory Control
2.3. Labor Management System
2.4. Slotting
2.5. Batching Logic
3. Essential Warehouse Operations Procedures
3.1. Inbound Logistics Process
3.2. Outbound Logistics Process
5. Conclusion
1. Importance of Warehouse Management Systems
A warehouse management system (WMS) is essential for optimizing warehouse operations and delivering exceptional customer service. There are five compelling reasons to consider implementing a WMS. Firstly, it enhances inventory control and management by reducing inventory levels, improving order fulfillment, and increasing accuracy. Secondly, it improves customer service and tracking through improved picking accuracy and automated shipment organization. Thirdly, a WMS boosts company productivity by adding warehouse efficiency and quality control to the fulfillment process. Fourthly, it provides a significant return on investment by improving sales accuracy, reducing errors, providing safe warehouse and simplifying customer support. Lastly, a good WMS integrates seamlessly with existing business management systems and adapts to evolving needs. Additionally, WMS enables businesses to meet compliance regulations through real-time data recording, enhanced business intelligence, and process automation.
2. How Warehouse Management Systems Optimize Operations
2.1. Productivity Tracking
Warehouse management systems (WMS) are crucial in optimizing operations by providing comprehensive productivity tracking tools. These systems capture and analyze key performance indicators (KPIs) such as order fulfillment rates, picking accuracy, and labor productivity. Organizations can identify bottlenecks, allocate resources effectively, and implement process improvements by tracking these metrics in real-time and generating insightful reports. With WMS productivity tracking, businesses gain a clear understanding of their operational efficiency and can make data-driven decisions to enhance overall performance.
2.2. Inventory Control
Efficient inventory control is essential for logistics warehouse management, and WMS solutions excel in this aspect. WMS provides real-time visibility into inventory levels, locations, and movements. Businesses can accurately track stock levels, monitor expiration dates, and implement automated replenishment warehouse processes. With advanced features like cycle counting and stock level alerts, WMS ensures inventory accuracy and reduces carrying costs. By optimizing inventory control, businesses can avoid stockouts, minimize excess stock, and improve order fulfillment rates, enhancing customer satisfaction.
2.3. Labor Management System
WMS incorporates a robust labor management system that enables businesses to allocate and manage their workforce effectively. These systems provide tools for labor planning, task allocation, and performance tracking. WMS optimizes labor allocation by assigning tasks based on employee skills, availability, and workload. By monitoring labor productivity and efficiency, businesses can identify opportunities for improvement and implement training programs to enhance employee
performance. With WMS labor management capabilities, organizations optimize labor costs, minimize overtime, and improve overall operational efficiency.
2.4. Slotting
Strategic slotting is a critical component of warehouse optimization, and WMS offers advanced slotting capabilities. By analyzing data on product demand, turnover rates, and order frequency, WMS determines the optimal locations for different products within the warehouse. Efficient slotting reduces travel time, minimizes congestion, and streamlines order picking. WMS enables businesses to assign appropriate storage locations based on product size, weight, and velocity. By optimizing slotting strategies, organizations can significantly enhance picking efficiency, reduce errors, and improve overall warehouse productivity.
2.5. Batching Logic
Batching logic is a key feature of WMS that enhances order-picking efficiency. WMS intelligently groups multiple orders with similar product requirements, locations, or delivery routes. By consolidating these orders into batches, the system enables batch picking, where a picker can fulfill multiple orders in a single trip through the warehouse. Batching logic reduces travel time, minimizes labor costs, and increases order picking speed. By maximizing picking efficiency, businesses can improve order fulfillment rates, reduce order cycle time, and meet customer expectations effectively.
3. Essential Warehouse Operations Procedures
A robust distribution center network serves as the backbone of operations, transforming raw materials into finished products and ensuring their timely delivery to customers. To gain a comprehensive view of logistics network and improve supply chain visibility, it's crucial to understand the distinction between inbound and outbound logistics.
3.1. Inbound Logistics Process
Inbound logistics encompasses the services required to bring materials and goods into businesses. This includes transportation, storage, and delivery processes. With the help of warehouse management systems (WMS), purchasing can be streamlined by synchronizing vendor details and inventory control levels. WMS allows efficient receipt scanning and guides warehouse staff to shelve items accurately. It also recommends optimal put-away, slotting, and storage space utilization techniques. Additionally, WMS facilitates reverse logistics by providing real-time information on product availability, enabling timely restocking and preventing stockouts.
3.2. Outbound Logistics Process
Outbound logistics focuses on the storage, transportation, and delivery systems that ensures finished products reach their final destination. WMS plays a vital role in this process as well. It enables accurate order picking through barcode or RFID scanners, reducing errors and ensuring the right products are chosen. Warehouse management processes integrated with WMS can automate product packaging, allowing for differentiation across sizes and optimizing packaging channels. Moreover, WMS simplifies printing shipping labels, price tags, logos, and other necessary documentation, eliminating manual data input and reducing human errors. WMS enhances the overall customer experience and minimizes fulfillment errors by ensuring timely delivery and notifying customers.
4. Implementing Cloud Warehouse Management Systems to improve productivity
Using a cloud-based warehouse management system offers several advantages for businesses looking to optimize their inventory control and streamline operations in complex distribution environments. Cloud supply chain management solutions provide benefits like multi-warehouse tracking, sales forecasting, and on-time delivery. Here are three key benefits of implementing a cloud WMS:
Increased control over business growth: Cloud-based WMS provides real-time visibility into inventory, allowing businesses to manage operations and make informed decisions efficiently. With automatic updates and centralized access, stakeholders can access relevant information anytime, enabling better control over business growth and flexibility to adapt to changing market demands.
Improved customer service: A cloud WMS empowers teams to track shipments, update arrival dates, and effectively manage the supply chain. It enables seamless communication and collaboration across the organization, ensuring timely deliveries and enhancing customer satisfaction. Efficiently conveying information leads to better customer service and a competitive edge.
Preparedness for upcoming changes: Cloud WMS offers an affordable and scalable warehousing solution. With cloud computing, businesses can easily adjust resources to meet fluctuating demands and seasonal changes. The ‘self-service’ access to WMS applications in the cloud allows for increased agility and quick adaptation to evolving business needs. Unlike traditional self-hosted systems, cloud WMS eliminates the need for upfront hardware investments and provides seamless scalability.
5. Conclusion
In the rapidly evolving business landscape, a warehouse management system (WMS) holds immense importance for organizations aiming to optimize their operations. As we look to the future, the role of WMS becomes even more crucial. With advancements in technology and the advent of new platforms, a cloud-based WMS offers unparalleled integration possibilities. By harnessing the power of cloud supply chain planning systems, businesses can gain better control over their inventory and navigate the complexities of modern distribution environments. The benefits are significant: increased control over business growth, improved customer service through real-time tracking, and preparedness for upcoming changes. By embracing cloud, WMS empowers businesses to stay agile, enhance productivity, and drive sustainable success in the dynamic business landscape of the future.
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Supply Chain
Article | August 17, 2023
Improve supply chain operations with innovative inventory management best practices. Uncover the techniques for achieving exceptional supply chain performance in the B2B competitive marketplace.
Effective inventory management is critical for businesses seeking to optimize their supply chain operations and improve their warehousing & supply chain distribution efficiency. By employing demand optimization techniques, inventory management aims to strike the right balance between meeting current and anticipated future demand while minimizing unnecessary inventory costs. Organizations that maintain optimal inventory levels can mitigate challenges associated with inventory, such as overstocking and stockouts.
In supply chain management, inventory optimization is vital, as it directly impacts organization’s ability to thrive. For any enterprise selling products, the effective management of goods is essential. Without adequate stock levels for sales or fulfilling customer orders, revenue generation and overall income can be severely hindered. Inefficient inventory management, leading to stock shortages, can create stumbling blocks for businesses. Conversely, improper stock tracking resulting in excess inventory can strain financial resources. As these issues compound, it further contributes to inventory imbalances, eventually leading to bottom-line losses from expired or redundant stock.
According to a recent Statista survey, 40% of the supply chain industry has already adopted advanced technologies to optimize its inventory and using networking tools.
The above data signifies the importance of optimizing and managing inventory for improved supply chain performance. Inventory analytics, typically overseen by an inventory manager, offer valuable insights that aid in understanding and enhancing inventory performance. Inventory management best practices help achieve effective inventory optimization, crucial data points encompassing products, suppliers, procurement, purchases, and sales that are meticulously tracked within the inventory management system. These data, in turn, serve as the foundation for formulating inventory metrics aimed at demand optimization.
This article explains the techniques to optimize and manage inventory with the inventory management best practices that helps overcoming challenges, addressing procedural considerations, and highlighting the significance of implementing these methods. Additionally, it explores the benefits of adopting solution for improved supply chain distribution network.
1. Implementing Standard Inventory Review Systems
To enhance supply chain operations, adopting standard inventory review system is essential, which can significantly contribute to inventory optimization efforts. Two effective methods to review systems include the continuous review system and periodic review system. In the continuous review system, fixed quantities of items are ordered in each cycle, providing a steady and consistent approach to inventory management.
On the other hand, the periodic review system involves collecting products at predetermined intervals, considering the inventory levels at that specific moment. Embracing these standardized review systems empowers businesses to streamline inventory processes, maintain optimal stock levels, and improve overall supply chain efficiency.
2. Streamline Stocktake
Supply chain operations can be improved by streamlining the stocktaking process, which involves meticulously counting and managing inventory. A well-structured stocktake procedure ensures accuracy and prevents losses by keeping staff engaged and focused.
To achieve accuracy and earn profits, businesses must:
Schedule stocktakes strategically to minimize disruption in regular business operations.
Prioritize cleaning and organizing the stockroom before the stocktake to facilitate efficient counting.
Clearly define the item count and the counting methods to eliminate guesswork.
Conduct comprehensive stock counts, leaving no room for assumptions.
By implementing these measures, businesses can optimize inventory management, identify discrepancies promptly, and maintain precise stock records. The streamlined stocktake process contributes to smoother supply chain operations, reduces inventory-related errors, and enhances overall productivity and profitability.
3. Utilize Cloud-Based Inventory Management System
Transitioning from Excel inventory management to a cloud-based inventory management system is critical to enhancing supply chain operations. It is considered one of the most used inventory control best practices. Unlike locally-installed applications, cloud-based software offers numerous advantages, enabling businesses to pay for essential features and effortlessly upgrade as needs evolve. Companies can efficiently manage costs with a predictable subscription fee tailored to feature requirements and team size. Seamless upgrades become hassle-free as business growth justifies a move to a more robust platform, ensuring scalability.
Additionally, cloud technology provides continuous support, ensuring smooth operations and quick issue resolution. With a dedicated support team on standby, businesses can focus on optimizing inventory management, managing warehouse automation, and driving overall productivity. Embracing cloud-based inventory management is a business-changing decision that unlocks increased agility, accessibility, and cost-effectiveness for long-term success.
4. Implement Adequate Quality Control Practices
Enhancing supply chain operations requires the implementation of robust quality control practices. Accurate quality control processes play a pivotal role in maintaining inventory quality, directly impacting customer satisfaction and business growth.
Effective steps include developing comprehensive checklists, outlining stock-taking procedures, followed by standard operating procedures to qualify or disqualify products with effective warehouse management systems. By adhering to these protocols, businesses can prevent issues of overstocking or understocking, ensuring customers receive only appropriate merchandise.
Companies can strengthen their reputation, increase operational efficiency, and cultivate lasting customer loyalty through this inventory optimization best practice. The seamless integration of quality control practices into the supply chain fosters a thriving business environment built on excellence and customer-centricity.
5. Preparing Well Planned Inventory Budget
A well-structured inventory budget is one of the industry-used inventory management best practices to enhance logistics distribution and supply chain processes. Managers commonly utilize an annual inventory budget, meticulously prepared before procuring inventory. The budget is designed to encompass the total cost of ownership for the upcoming accounting period, encompassing materials cost, fixed operational expenses, transportation and logistics charges, redistribution costs, and other miscellaneous expenses impacting the inventory's total cost of ownership. By crafting a comprehensive inventory budget, businesses gain financial clarity, optimize resource allocation, and ensure efficient inventory management throughout the year. A well-planned budget empowers informed decision-making, minimizing financial risks and driving overall supply chain success.
6. Carrying Safety Stock Inventory
Operations in the supply chain require safety stock inventory – a strategically maintained surplus of inventory to protect against market demand and lead time fluctuations. By implementing safety stock, businesses can avoid revenue loss, customer attrition, and declining market share that may arise in its absence.
Safety stock is vital with the advantages it offers:
Protection against sudden surges in demand.
Prevention of stockouts, ensuring uninterrupted customer service.
Compensation for inaccuracies in market forecasts.
A buffer for longer-than-expected lead times, averting production delays.
Incorporating safety stock as a fundamental inventory management best practice empowers companies to achieve operational supply chain resilience, optimize customer satisfaction, and maintain a competitive edge in the dynamic market landscape.
7. Optimize Inventory Turnover Rates
Optimizing inventory turnover rates is a critical metric that frequently measures inventory sold or used within a specific timeframe, typically a year. Calculating turnover rates provides valuable insights into market demand, identifies obsolete stock, and guides inventory management decisions.
Inventory turnover can be improved through various strategies, such as experimenting with pricing to attract more customers and boost sales, liquidating obsolete stock to free up capital and storage space, forecasting customer demand accurately to maintain optimal inventory levels, and redistributing inventory among warehouses for better stock availability. By optimizing inventory turnover rates, businesses can reduce carrying costs, minimize stock obsolescence, and enhance overall supply chain efficiency, as well as gaining competitive advantage in the market.
“It’s been my observation that the business world has a weak understanding of inventory management and control. They are trained shallowly, and sometimes they apply only shallow experience to their practices. Sometimes, that works out great. In my 30 years of experience, however, I have seen that a lot of money can be saved by training and managing inventory control in-depth.”
-Inventory Control Expert Dr. Pyke
Final Thoughts
Adopting advanced inventory management best practices is crucial for supply chain optimization in the competitive B2B environment. Standardized inventory review systems and streamlined stocktakes optimize control and accuracy, minimizing disruptions. Cloud-based inventory management offers scalability and continuous support, facilitating data-driven decisions. Adequate quality control ensures inventory quality, driving customer loyalty. Well-planned budgets lead to financial clarity and precise resource allocation. Safety stock inventory and optimized turnover rates fortify businesses against uncertainties, boosting efficiency and profitability. By embracing these practices, logistics professionals can enhance supply chain potential, achieve lasting success, and gain a competitive advantage in the market. With a data-focused approach, these strategies pave the way for streamlined operations, stronger customer relationships, and sustained growth.
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