The Role of Business Intelligence in the Supply Chain

Alexander Ivanov

Alexander Ivanov

Head of Logistics Technologies at Andersen

Jul 20, 2022
7 minutes to read

Any supply chain is a complex phenomenon. No matter how short it may be, it is inherently difficult to control and manage as it, by definition, involves several interconnected yet independent parties. After all, ‘supply chain’ refers to a network involving entities, employees, operations, data, and resources required to supply a product or service to an end consumer. Dealing with such sophisticated and multidimensional systems without a reliable supply chain management Business Intelligence solution is extremely challenging, especially under the current circumstances associated with lockdowns, political tensions, and trade wars. Hence, Business Intelligence in the supply chain can be viewed as a crucial factor for the survival of any logistics company. In this piece, we will examine the role it plays.

The Supply Chain business: an overview

As of now, the supply chain business is experiencing significant growth. Back in 2020, its size was $15.58 billion, while in 2025, it is projected to reach $27.58 billion. This growth could be even more impressive, however, it is hindered by severe disruptions caused by the factors mentioned above. That is to say, lockdowns, political tensions, and border closures are likely to stay with us. These new risk factors make themselves felt against the background created by such ‘classical’ and ‘habitual’ disruptors as mergers and acquisitions, extreme weather conditions, factory fires, business sales, cyberattacks, IT issues, and loss of talent.

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Indeed, as Statista reminds us, the number of supply chain disruptions worldwide is growing rapidly: back in 2019, 3,700 supply chain disruptions occurred. In 2020, there were 6,192. As for 2021, the number amounted to a staggering 11,642. All these disruptions inflict heavy losses on the world economy and cost various organizations around the globe “an average of $184 million per year,” as a 2021 survey indicated. What makes matters worse, in some regions the average price to pay for supply chain disruptions is even higher! For instance, in the US, “the estimated average annual cost to respondents' organizations” is as high as $228 million.

Hence, to stay competitive and cost-effective in such a challenging environment, supply chain companies have to apply every possible tech advancement and IT solution to foresee risks, prevent disruptions, and deal with their consequences. Real-time Business Intelligence in supply chain analytics is definitely one of the remedies to try in this respect.

What is Business Intelligence in Supply Chain management?

The key mission of Business Intelligence solutions in any industry is to assist companies with making the right decisions by informing them about their current situation, building projections, and identifying trends based on the data available to them. Namely, this technology is intended to:

  • Help management teams track corporate inefficiencies, recognize bottlenecks, and take relevant steps to remove such obstacles;
  • Update all involved employees about the state of affairs via informative scorecards and customizable dashboards covering all applicable KPIs, indicators, and available metrics;
  • Keep track of progress and recent developments;
  • Ensure better collaboration and visibility by aggregating heterogeneous data dispersed among individual departments.

It is possible to attain these ambitious goals if your Business Intelligence solution can handle such tasks as:

  • Automatically collecting data in real-time with no manual input;
  • Processing and merging it to build reports;
  • Storing that information in an easily accessible yet safe fashion;
  • Displaying data via scorecards and dashboards;

Performing data analysis and making projections.

Value of Business Intelligence for the Supply Chain

If you obtain a custom-built Business Intelligence solution tailored specifically to your supply chain needs, you will immediately start benefiting from such new opportunities as:

  • Fine-tuned demand and inventory management. As a result, your company will be adapted not only to seasonal customer behavior patterns, but also to sudden fluctuations, acts of God, and other unanticipated events.
  • Transparent and effective distribution management. Goods will be delivered to your end clients via the most optimal channels.
  • Transparent transportation management. This capability will enable you to not only track how your products move from one location to another but also to make decisions and introduce changes on the go.
  • Various decision-making tools. Data visualisation features and projections allowing you to track KPIs and set new goals.

With all these opportunities at your disposal, your business will capitalize on:

  • Increased return on data usage. You will generate more revenue and be able to continue investing in your core business activities.
  • Strengthened competitiveness and improved client service. You will win more loyal customers. In such a competitive industry, reputation and trust are invaluable assets.
  • Data-driven decisions and all weak spots identified. You will cut costs, save time and resources, and be in the right position to drive more and more value.
  • Optimized workflows. You will streamline your operations and boost the efficiency of every employee and business par