10 ways big data is revolutionising supply chain management

(c)iStock.com/Сергей Хакимуллин

Big data is providing supplier networks with greater data accuracy, clarity, and insights, leading to more contextual intelligence shared across supply chains.

Forward-thinking manufacturers are orchestrating 80% or more of their supplier network activity outside their four walls, using big data and cloud-based technologies to get beyond the constraints of legacy enterprise resource planning (ERP) and supply chain management (SCM) systems. For manufacturers whose business models are based on rapid product lifecycles and speed, legacy ERP systems are a bottleneck.  Designed for delivering order, shipment and transactional data, these systems aren’t capable of scaling to meet the challenges supply chains face today.

Choosing to compete on accuracy, speed and quality forces supplier networks to get to a level of contextual intelligence not possible with legacy ERP and SCM systems. While many companies today haven’t yet adopted big data into their supply chain operations, these ten factors taken together will be the catalyst that get many moving on their journey.

The ten ways big data is revolutionising supply chain management include:

Figure 1 SCM Data Volume Velocity Variety

  • Enabling more complex supplier networks that focus on knowledge sharing and collaboration as the value-add over just completing transactions.  Big data is revolutionising how supplier networks form, grow, proliferate into new markets and mature over time. Transactions aren’t the only goal, creating knowledge-sharing networks is, based on the insights gained from big data analytics. The following graphic from Business Ecosystems Come Of Age (Deloitte University Press) (free, no opt-in) illustrates the progression of supply chains from networks or webs, where knowledge sharing becomes a priority.

figure 1 big data scm

  • Big data and advanced analytics are being integrated into optimisation tools, demand forecasting, integrated business planning and supplier collaboration & risk analytics at a quickening pace. These are the top four supply chain capabilities that Delotte found are currently in use form their recent study, Supply Chain Talent of the Future Findings from the 3rd Annual Supply Chain Survey (free, no opt-in). Control tower analytics and visualization are also on the roadmaps of supply chain teams currently running big data pilots.

Figure 2 use of supply chain capabilities

  • 64% of supply chain executives consider big data analytics a disruptive and important technology, setting the foundation for long-term change management in their organizations.  SCM World’s latest Chief Supply Chain Officer Report provides a prioritisation of the most disruptive technologies for supply chains as defined by the organisations’ members.  The following graphic from the report provides insights into how senior supply chain executives are prioritizing big data analytics over other technologies.

disruptive tech

  • Using geoanalytics based on big data to merge and optimise delivery networks.  The Boston Consulting Group provides insights into how big data is being put to use in supply chain management in the article Making Big Data Work: Supply Chain Management (free, opt-in). One of the examples provided is how the merger of two delivery networks was orchestrated and optimized using geoanalytics. The following graphic is from the article. Combining geoanalytics and big data sets could drastically reduce cable TV tech wait times and driving up service accuracy, fixing one of the most well-known service challenges of companies in that business.

Figure 4 geoanalytics

figure 6 big data


figure 7 big data

  • Greater contextual intelligence of how supply chain tactics, strategies and operations are influencing financial objectives.  Supply chain visibility often refers to being able to see multiple supplier layers deep into a supply network.  It’s been my experience that being able to track financial outcomes of supply chain decisions back to financial objectives is attainable, and with big data app integration to financial systems, very effective in industries with rapid inventory turns. Source: Turn Big Data Into Big Visibility.

figure 8 traceability

  • Traceability and recalls are by nature data-intensive, making big data’s contribution potentially significant. Big data has the potential to provide improved traceability performance and reduce the thousands of hours lost just trying to access, integrate and manage product databases that provide data on where products are in the field needing to be recalled or retrofitted.

  • Increasing supplier quality from supplier audit to inbound inspection and final assembly with big data. IBM has developed a quality early-warning system that detects and then defines a prioritisation framework that isolates quality problem faster than more traditional methods, including Statistical Process Control (SPC). The early-warning system is deployed upstream of suppliers and extends out to products in the field.
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8 Sep 2015, 5:02 a.m.

Great insights have been focused. Big Data Era! TorQEYE Analytics


8 Sep 2015, 8:25 p.m.

Lauren, one big data company I think worth mentioning is HPCC Systems from LexisNexis. Designed by data scientists, HPCC Systems is an open source data-intensive super computing platform to process and solve Big Data analytical problems and can help companies derive actionable insights from their data. HPCC Systems provides proven solutions to handle what are now called Big Data problems, and have been doing so for more than a decade. The main advantages over other alternatives are the real-time delivery of data queries and the extremely powerful ECL language programming model. More info at http://hpccsystems.com