Business Intelligence Can Reduce Supply Chain Risk, says Cognos Industry Expert

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Business intelligence can provide complete visibility across disparate ERP, financial, and supply chain management systems from various suppliers dispersed around the world. With business intelligence, manufacturers know where and when problems occur and can take informed action.

For those that depend on a single supplier, one disaster can bring business to a halt

Manufacturers depend on lean and highly outsourced supply chains to cut costs and stay competitive. But many experts think the efficiency gains also bring higher risks.

This underlines the need for manufacturers to implement business intelligence across their entire supply chain to provide visibility into and across their operations, said Paul Hoy, CPIM. Hoy is director of manufacturing solutions at Cognos, one of the world's leading providers of business intelligence and performance management solutions.

Internal and external risks

According to Hoy, companies are vulnerable to events or disruptions that impact their supply chains - everything from cross-border issues and labor unrest to natural disasters and fires, even bankruptcy.

"For those that depend on a single supplier, one disaster can bring business to a halt," he said.

But having too many suppliers doesn't guarantee immunity, either. The further you go down the chain, the harder the problems are to spot. According to The Economist, some companies don't know who is supplying their suppliers or even where these lower-tier suppliers are based.

Ways to manage them

Hoy outlined four ways that manufacturers can use business intelligence to manage their supply chain risks. At its highest level, said Hoy, business intelligence can provide complete visibility across disparate ERP, financial, and supply chain management systems from various suppliers dispersed around the world. With business intelligence, manufacturers know where and when problems occur and can take informed action.

Dashboards and scorecards: These technologies provide highly visual information for monitoring supply chain operations, said Hoy. If performance falls into the red or exceeds a threshold, managers can access detailed information through supporting reports and analysis.

Business event management: Supply chain managers receive email alerts when a pre-determined disruption or unusual event occurs--such as parts shortages or shipments at risk, said Hoy.

Analysis: Managers can explore current issues or problems in the supply chain to understand what led to the results to achieve process optimization., said Hoy.

Reporting: Provides up-to-the minute views on key supply chain areas that can be shared across portals and extranets, according to Hoy.

"It pays to be prepared when problems occur," said Hoy. "Business intelligence provides a complete view of supply chain indicators across all transaction systems. It helps companies plan and respond effectively to keep the business on track no matter what happens down the line, a critical ability in the high-risk world of supply chain dynamics."

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Amy Shanler
Cognos
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