Group Director, Chartered Institute of Procurement and Supply
Technology is fast becoming an integral part of an organisation’s procurement and supply management strategy. In particular, the use of data is shaping an organisation’s approach to its suppliers and customers.
Big data is defined by large volumes of data that an organisation has, in increasing volumes, complexity, speed and variety; a rich vein of insights many businesses still struggle to use efficiently and effectively.
In our research, which focussed on digitalisation in supply chains and the key technologies organisations were implementing, big data was described as the ‘new oil’ in terms of its importance and usefulness to an organisation.
The value of big data
Of the companies surveyed, 24% had implemented a focus on big data over the last three years as a way of being able to give early warning signs of disruption in supply or a pathway to new products and services.
For the manufacturing sector, as well as sources of intelligence in internal business processes, other sources of data can be highly beneficial in supporting horizon scanning efforts as businesses look for the next potential threat or opportunity.
The S&P Global/CIPS Purchasing Managers’ Index in manufacturing (formerly IHS Markit), is a monthly snapshot of inflationary costs, employment and availability of supplies in the sector. It not only tracks official government data closely and accurately, but also offers early insight into what supply chain managers are saying is happening ‘on the ground’.
Big data was described as the ‘new oil’ in terms of its importance and usefulness to an organisation.
Managing external disruption
In February, as the threat of the Omicron COVID-19 variant receded in the UK and government lockdowns were no longer in place, orders and output in the sector grew at a quicker pace and the sector expanded more quickly than economists predicted.
Supply chain disruption also eased, though still remained at historically high levels, as average lead times lengthened for a thirty-second consecutive month. These respected datasets can guide supply chain managers into looking at alternative sources or increase their forward buying strategies to beat supply blockages in the coming months.
As inflationary charges also soared in February and at survey records, businesses were looking at filling up their warehouses with parts that may increase in cost still further in response to what this data was indicating.
Using data stores for future planning
Whether statistics and data are like precious nuggets of gold or the new oil, each organisation should start looking at their data stores and what other insights can tell them about their business now and in the future.
Businesses need to find the right sources of information for them and use these insights regularly to give them a competitive edge in the marketplace.