Surprisingly, there are still many manufacturers that manually track goods coming in and out of the factory or warehouse. However, those that do will find it increasingly difficult to compete. LevaData’s 2019 Cognitive Sourcing Study found that 50% of manufacturing organizations still rely primarily on Excel spreadsheets or data warehouses with limited tracking or market intelligence.
And while accurate, up-to-date data is important to building a business’ digital muscle, data alone is not enough, particularly when it’s siloed in disparate systems. When seeking to improve forecast accuracy, manage distribution centers efficiently and ensure rapid product turns, accurate demand and product data is essential. Business inefficiencies are costly if your team wastes time searching for data that should be easily accessible and accurate.
Because of the uncertainties around the lasting effects of a global pandemic — not to mention continually evolving consumer demand, a challenge even before COVID-19 — achieving deeper, consolidated data management should be top-of-mind. Manufacturers must seek solutions that can provide visibility into multiple systems through one portal, enrich enterprise data and establish governance to deliver accurate and current data across the business. Such a strategy reduces human error, enables a manufacturer to better respond to market-based threats and opportunities, and helps businesses keep up with ever-changing data protection regulations.
Here’s a deeper look at three reasons why data is so critical for today’s manufacturers — and the greater supply chain.
Improve demand planning with quality data
During the pandemic, we’ve seen how the market can shift on a dime. Think how the demand for toilet paper, hand sanitizer and meal kits skyrocketed, while the need for business clothing and shoes plummeted. While this was a once-in-a-lifetime event for many manufacturers, it was a reminder that production must keep a close eye on seasonal and historic—al changes in demand. When manufacturers don’t track this data, or rely on incorrect data, they can end up with stockouts and unhappy customers or a warehouse filled with too much inventory and wasted capital.
Solutions such as master data management (MDM) enable companies to leverage and aggregate historical data to generate data-based supply chain forecasts, avoiding stockouts or overstocks. Pulling in data on retailer ordering patterns also helps manufacturers understand what products are flying off the shelves so they can respond accordingly, and when to slow production on items accumulating dust in the warehouse or store aisles. Leveraging location data to identify patterns for replenishment brings additional value to ensure the right product is replenished (or planned for) to the right location — maximizing customer satisfaction.
Mitigate risk by responding quickly to recalls
Supply chains aren’t perfect and recalls occur — affecting not only company profits but reputations.
The 337 recalls reported by Food Safety Magazine in 2019 included everything from ready-to-eat chicken strip products to romaine lettuce to flour. And while food recalls are prevalent in the news, clothing manufacturers can also suffer when their items are recalled. Tracing the source of a salmonella outbreak in onions or a flammable material used to make scarves can be painstaking without quality data with the attributes to support effective analytics
When recalls occur, MDM can help manufacturers mitigate risk by reacting quickly and managing the process smoothly. With a single, shared and accurate view of products, suppliers and distributors, manufacturers can track products from origination to store shelf. MDM also enables deeper traceability, allowing manufacturers to not only pinpoint the source of an outbreak or defective apparel and close it down, but also use location data to determine which stores have the faulty product — keeping unaffected products on the shelves.
Tackle supply chain challenges with improved communication
The idiom ‘the devil is in the details’ rings particularly true when you lack the particulars of products moving through the supply chain. The need for transparency in an increasingly complex supply chain — both upstream and downstream — can’t be emphasized enough for product replenishment and inventory management.
Let’s say, for example, the warehouse of a supplier you depend on is crippled by a cyberattack, leaving you without the raw materials needed to get your product to market. With shared data, you can pivot to another supplier quickly and have visibility into other available raw materials when you need it.
Globalization has created increasingly complex supply chains, with many tiers of suppliers often needed to manage product delivery. If a manufacturer’s data is stored in siloed systems, however, it can be difficult to smoothly navigate these kinds of bumps in the road. MDM provides manufacturers visibility into all their suppliers, so they can understand raw material availability and manage any supply chain interruptions.
Clean, up-to-date data is critical
As manufacturers try to gain a competitive edge in the current down market, data holds the key to streamlining inefficient processes. Consistent access to clean, up-to-date data helps them overcome supply chain challenges such as quickly shifting market demands, product recalls and unexpected interruptions beyond the production floor.
MDM helps manufacturers make the most of our data, to respond more effectively to shifting demand. With faster, smarter decisions based on this accurate data, manufacturers can gain a competitive edge in their complex, ever-changing industry.
Doug Kimball is vice president for Global Industry and Solution Strategy with Stibo Systems
