Emerging technologies are giving businesses an opportunity to gain greater control over and visibility into their supply chains. However, the same technologies can also create management complexity and technological overhead that can limit innovation when data is not handled effectively.
Data integration and process automation are critical in this environment, especially as more organizations face pressure to establish sustainable supply chain ecosystems that are backed by big data.
The Growing Move Toward Sustainability in the Supply Chain
Going green is a common theme across a wide range of industries, with organizations using sustainability for everything from gaining some marketing momentum to driving long-term cost savings by reducing energy footprints. Sustainability in the supply chain, however, depends on establishing environmental and economical viability across every part of the supply chain. This can include the following:
- Ensuring partners that are gathering raw materials are doing so in sustainable ways.
- Minimizing the emissions requirements for good transit between source locations, warehouses, production areas and customers.
- Using eco-friendly packaging materials.
- Establishing efficient routes throughout the warehouse to minimize fuel or energy consumption from forklifts, drones and similar vehicles.
These types of sustainability issues add up quickly to create considerable management overhead, but a Supply & Demand Chain Executive report explained that organizations that handle sustainability well can position themselves to streamline innovation. In the article, industry expert Jean Bennington Sweeney said that an ideal vision for sustainability - one in which local communities are prioritized in supply chains and access to natural resources remain balanced - is achievable in the modern supply chain. The problem, at least for many businesses, is that many companies think sustainability will create costs and inefficiencies that limit potential for innovation. When handled well, organizations can use sustainability efforts to drive innovation.
Using Sustainability to Fuel Innovation
Sustainability and corporate responsibility initiatives can seem like a burden for organizations, especially if it involves taking on more expensive products and processes in the supply chain. However, beyond marketing and brand-building benefits, sustainability efforts can also push organizations to new creative heights. The problems created by sustainability issues are real. Potentially higher costs, the need to connect with a wider range of suppliers and demand for greater visibility into the supply chain present significant issues that must be overcome.
The SDCE report explained that organizations committed to sustainability are forced to solve these problems. In doing so, those companies are driven toward innovation as employees end up forced to get creative and develop new ideas in order to address the new challenges associated with sustainability. Furthermore, employee morale and engagement can also be improved through a sustainability program because workers can get behind the company's overarching cultural goal.
These factors all add up to create an environment in which sustainability and business growth can go hand in hand. That is, they can if organizations are able to measure their sustainability programs and gain a clear understanding of their impact on the supply chain. According to the report, organizations that want to leverage sustainability to drive consistent business growth must emphasize measuring success on an ongoing basis to do so. This includes setting clear goals and metrics that define success and gathering data to measure progress at any given time.
This is where big data comes into the sustainability conversation, and the time has arrived for more organizations to embrace analytics within day-to-day operations.
Big Data Rising Across Wide Range of Sectors
For a long time, big data programs had been relegated to relatively large organizations with the fiscal resources and technological infrastructure needed to support a large-scale analytics program. However, the shifting technological environment around analytics is making big data more accessible than ever, and it may be time for small and medium-sized organizations to start exploring what big data can do for them, Supply Chain Digital reported.
According to the news provider, many small organizations end up getting intimidated by big data because they assume that the scale of information they will need to process will be too overwhelming for them to handle. However, this is one of the misconceptions of big data. While these analytics programs do require businesses to process large quantities of data, focusing solely on the volume issue neglects the other two components of big data: Velocity and variety. Analytics initiatives are often just as much about integrating data into business operations in such a way that data is used quickly and from a wide range of sources.
A big data program analyzing operations in the supply chain doesn't necessarily need to capture incredibly large quantities of data. Instead, it involves giving users real-time access to key data and analytics involved with that information. For example, big data systems can identify when the percentage of damaged goods entering the warehouse is unusually high and immediately alert managers of the situation. In this case, the amount of information being processed is no different than it would have been in the past - tracking damaged items upon arrival is common practice, but here's what is different:
- Giving users automated data collection tools so they can quickly process information.
- Integrating mobile data collection apps with the enterprise resource planning system to offer managers immediate visibility into operations.
- Aligning data across warehouse management systems and ERP platforms to allow analytics programs to identify trends and tendencies.
- Automating data integration and communication across lines of the business, so all stakeholders can take full advantage of the data on hand.
The Supply Chain Digital report explained that big data is particularly helpful in the supply chain because organizations must bring together employees from multiple disciplines to find success. With so many components of the business involved in the supply chain, being able to bring the variety of data types in use together for analysis can have powerful results. For smaller organizations, the potential here is great because the technical burden can be shifted into the cloud or alleviated with strategic data management. As such, big data readiness is primarily a matter of ensuring the company is gathering the right information from across the supply chain and maintaining high levels of data quality.
Using Big Data to Drive Sustainability
If effectively measuring performance is critical to taking advantage of the benefits of a sustainability program, then having big data programs in place is among the best ways to gain more value from sustainability. The supply chain visibility created by a big data program gives organizations that boost needed to get more from sustainability programs, whether those gains come in the form of spending optimization, improved vendor management or internal efficiency gains.
Using big data as a driver for sustainability program success is a natural match, but organizations that want to ensure innovation in this way must lay the groundwork for ongoing gains through better data collection and automation. Asking users to become more actively involved in analytics hinges on offering them the tools they need to gather and distribute information effectively. Warehouse management software platforms that provide data collection, integration and analysis capabilities can prove invaluable in connecting diverse lines of the business, particularly when functionality extends out to mobile device users. Smartphones can help workers quickly and easily create and view data, but only if apps and services extend out to smartphones and tablets.
With sustainability and big data offering so much potential in the supply chain, companies that want to get ahead must begin by improving data management.