Addressing supply chain challenges with Data-driven approachData Nectar Technologies
Supply chain leaders were already being tested in recent years by volatile market trends, rapidly changing customer demands, and new and emerging risks to supply chain disruption. The new reality of the global pandemic has introduced even more challenges for supply chain management. Although making use of agility and operational business insights to build supply chain resilience has long been a priority for CPOs, CFOs, and supply chain executives, the pandemic has increased the urgency: 31 per cent of CFOs indicated supply chain issues rank as one of their top three concerns related to the COVID-19 outbreak.
And it’s no surprise that most of these challenges are data-driven. It’s only when you have end-to-end insights into your suppliers, product, material or customer data that you can get a better understanding of macro demand trends, enable rapid identification of alternate suppliers, improve collaboration, and automate onboarding for faster time-to-market.
Here are five data-driven supply chain challenges that were heightened by the global pandemic.
1. Information Visibility impacting Decision Making
Supplier data is often incomplete, outdated, and fragmented across dozens or even hundreds of systems, such as supply chain management and supplier relationship management (SRM) software, dozens or hundreds of Enterprise Resource Planning (ERP), financial and accounts payable systems across your product lines and regions. Valuable data is hidden in spreadsheets, databases, and remote file stores, each with its own structure and data model. This critically valuable asset is piling up in each business unit, every procurement team, and all regional offices, often making it impossible to access a consolidated, complete, trusted view of all your suppliers and sub-suppliers and act quickly.
Mostly the procurement leaders have limited or no visibility beyond their top suppliers or say, tier-1 suppliers. Also, CFOs increasing face challenge to have a single version of the truth and without that, it’s difficult for them to meet business goals.
More than ever, procurement and finance rely on a trusted 360-degree view of their supply chain and across their supplier network. To build supply chain resilience, they need automated workflows that help identify and onboard alternate suppliers quickly. Centralized access improves visibility and increases transparency into your supplier data for a trusted understanding of all relationships and improved supply chain insights and decision-making.
2. Poor Data Quality Data Costs Millions
If the data is incorrect, incomplete, or outdated, not even the best supplier information management solutions can help. In fact, poor supplier data quality can cost millions, in terms of poor business decisions, ineffective operations and logistics, missing procurement information, and significant opportunity cost.
As a nature of the role, procurement officers prioritise the cost reduction over a financial period and they normally cite master data quality, standardization, and governance as the biggest 5 challenges to procurement and financial efficiencies.
Automated data quality checks embedded in your supplier management workflows effectively improve the quality of supplier data while reducing manual workload and costs.
3. Manual Processes Slow Time to Market
Using ineffective and inefficient manual processes to manage supplier data is usually accompanied by a lot of redundant workloads and results in a significantly slowed down time to market. If on boarding a new supplier takes weeks or months, that represents tangible opportunity cost and lost business.
CPO’s look for improving and automating procurement processes as a key priority for the organisation and on the contrary still many of businesses still rely on traditional tools or improvised MS office tools for workflow management & supplier relationship management.
Automating supplier and product information management workflows reduces the time it takes to onboard new vendors by up to 80% and improves time to market for new products by up to 10x with streamlined and automated supplier onboarding, workflows, and self-service.
4. Data Governance and Lack of Transparency
Supply chain risk factors and uncertainty have increased over the past couple of months. The ability to assess the risk for a specific supplier while also monitoring their compliance or performance is an ongoing pain point for some supply chain executives.
By making compliance a factor when onboarding new suppliers, you can mitigate supply chain and vendor risk with a 360° view that allows you to monitor and reduce supplier risk and access alternate suppliers in case of a supply chain disruption. By fueling all supplier-facing applications, business intelligence tools, and analytics programs with trusted, governed, up-to-date supplier data, your finance, legal, and supplier relationship management teams can more easily monitor and analyze their suppliers’ risk and compliance.
5. Sustainable Sourcing and Traceability are Key for Consumer Trust and Loyalty
Another critical factor to remember is how to manage consumer expectations as they make their purchase decisions. Leading brands like Unilever and retailers like PVH are focusing their supply chain and marketing efforts around ecological and social sustainability and traceability, as they see this as an important driver for long-term success. Responsible, transparent sourcing and sustainability will become more and more of a factor when onboarding new suppliers.
Businesses tend to refuse to buy from companies they do not trust as supply chain traceability is a key criterion for them.
Gain consumer trust by providing trusted and relevant product, ingredient, and sourcing data to create a unique and seamless brand experience and make compliance, transparency, and sustainability a factor when onboarding and monitoring suppliers.
At Data Nectar works with businesses to help them be more and more data-driven across functions & operations. Contact us to have a talk around your specific challenges pertaining to supply chain and how we could help!