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Turning Data Into Dollars

At $100 per barrel, crude oil is an extremely valuable resource, but even more prized to members of the supply chain these days is data — or rather, big-data.

The term big-data does not describe how much information is resident in a database or IT system, but rather, it defines a category of data derived in real-time or near real-time from multiple sources in multiple forms. Unlike execution or transaction-focused platforms like ERP or CRM, big-data offers the potential to turn available information into actionable insights using pre-defined predictive analytics.

This is where the road diverges for those that successfully capture and utilize big-data, and those that are derailed by information overload. According to a 2011 report on big-data by McKinsey & Company, 15 out of 17 sectors in the US have more data stored per company than the US Library of Congress. To put that in perspective, McKinsey pegs the volume of data resident in the Library of Congress in April 2011 to be 235 terabytes or 235 trillion bytes.

Clearly, manually mining this mass of facts and figures is an impossible task, and current database tools do not have the capacity to manage and analyze the growing volume of data that is communicated and captured every day. But, there is a new breed of cloud-based tools and services designed to facilitate many to multi-enterprise communications. This allows members of an extended supply chain, including raw materials providers, sub-component suppliers, contract manufacturers, and logistics providers to efficiently aggregate and manage critical supply and demand data.

We have similar data-to-information conversion issues within the enterprise-wide supply chain. In many cases, the various players within the supply chain hold key data, that if used properly can help to inform the balance of the supply chain participants about potential risks before they occur, providing an opportunity for mitigation. This growing need has driven Avnet Velocity to introduce their “Control Tower” solution.

The Control Tower gives customers “predictive visibility,” in which the systems can use pre-defined business metrics to forecast potential problems and generate alarms for upcoming events. Control Tower customers then receive push notifications alerting them to a change in conditions that might impact their supply chain, such as a shortage in supply, expansion in lead time, concerns over cost relative to currency conversion, or natural disaster affecting raw materials availability.

Access to this critical supply chain intelligence enables OEMs to proactively shift or reprioritize their supply chains based on changing supply or demand signals within multiple tiers of the supply chain — both up and downstream. In this way, Control Tower moves beyond being just a tool for visibility, and becomes a tool for decision making.

The ability to refine data into greater business insights through sophisticated what-if analysis is swiftly becoming the next frontier for electronics supply chain innovation and productivity. Those that “know sooner” cannot only act faster, but with greater assurance that their efforts are in alignment with the operational and financial goals of their organizations.

Given the constant increase in complexity within the supply chain, with its accompanying sea of data transactions, I have no doubt that harnessing the power of data will increasingly become the defining characteristic of highly successful supply chains. Arguably, big-data is a bigger issue. However, it's a justifiable need for us to turn our supply chain data rapidly into information used to avoid disruption and provide assurance of supply.

10 comments on “Turning Data Into Dollars

  1. Barbara Jorgensen
    September 10, 2012

    There is definitely an opportunity here for compnaies that can crunch data and make it meaningful. It is one thing to retain it–any company can do that–but another to use that data to improve internal operations or customer support.

  2. SP
    September 11, 2012

    So true.These huge data if analysed properly can help in mitigating many risks. But you need manpower to do that. Not sure if companies are already started investing in these studies.

  3. hash.era
    September 11, 2012

    Data is always money. Most of the time you have to pay for what you take and making data into information will be like turing data into dollars. Whatever the information you generate via data will be used to perform some kind of an activity related to your business which will ultimately generate cash for the company.

  4. ahdand
    September 11, 2012

    Exactly, data is money and information is lot of money. You cannot say data does not carry a price tag. It does but when its being converted into information, you get the real deal. Keep data safely and use wisely when needed only and you will get the ROI done in quick time.

  5. stochastic excursion
    September 11, 2012

    Enterprise visibility is one of those things where more is always better.  The challenge here is having a package flexible enough to serve the right data in a visually informative way to customers who have widely different objectives in what they want to view.

  6. ahdand
    September 12, 2012

    Well for that you need a strong market analysis done. If not (which I still feel the best out of the lot) try to get the customers involved in decision making process. That will give confidence to customers plus you will gain what exactly the customers want.

  7. t.alex
    September 14, 2012

    This is one good case of adopting cloud solution into the supply chain. Real time updates being sent immediately via push notification is a great idea. Smart phones and cloud are of good use.

  8. hash.era
    February 16, 2013

    Yes definiely since it is something which should be considered if you are thinking about a long run.

  9. ahdand
    February 17, 2013

    Most of us plan for the long run but it fails in between since we do not execute our plans right on time. That is where things do get stucked.

  10. hash.era
    February 18, 2013

    Yes and executing right on time with right resources is what we have to do more on a regular basis. I think if we can get these acts properly we are very much well on course. 

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