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24 Mar 2011

Driving business performance through Supply Chain Intelligence

Ilaria Vincenzi
TXT e-solutions

For many years now companies have implemented business intelligence (BI) tools and for some BI has delivered powerful results, however too often the focus has been on marketing, sales, customer and financial analysis, and less on operations and supply chain (SC) activities. However, as companies have matured so has their use and understanding of technology! The renewed focus on supply chain management (SCM) as a key driver to business performance has resulted in companies increasingly looking to supply chain intelligence (SCI) solutions; this is both as a means to improve overall SC effectiveness and the bottom line.


From Business Intelligence (BI) To Supply Chain Intelligence (SCI)
SCI offers a level of insight SC managers can’t get with BI; a deeper understanding of the future rather than merely what is going on today; empowering them to not only make decisions for long term profitability, but critically minimise the “risk” their company is exposed to both operationally and financially. According to Gartner Research’s 2009 Hype cycle report, Supply Chain Performance Management is highly beneficial for businesses and continues to grow as a strategy, as companies look to maximise their end-to-end SC performance.

For those looking into SCI commonly asked questions are:

  • Does SCI still apply to me if I’m not a large multi-national organisation?
  • How can I make SCI work for me and what are the pitfalls to success?
  • What do I look for in a SCI solution that will help me realise business benefits in a timely fashion?


SCI doesn’t need to be a hugely expensive and long winded implementation to get value. Retailers in particular are finding success with small SCI projects that deliver fast ROI. Somewhere between 70% and 85% of actual buying decisions are made at the shelf, meaning retailers must focus on consistently fulfilling customer expectations during every interaction to be successful.
This has become more and more difficult as retailers are faced with challenges like increasing demand volatility, on shelf availability issues, lack of visibility etc. Retailers increasingly recognise these challenges and the opportunity which comes from investing and improving their SC to increase predictability and profitability while reducing inefficiencies.

There are three critical elements to a successful SCI project:

  1. For the tool to live up to its potential it must completely connect a companies’ SC operations with their financials;
  2. There must be “one version of the truth” when it comes to data i.e. it must be properly cleansed and managed. Excel spreadsheets is a common example of a tool that results in questionable decisions being made as they are based on multiple sets of data and often personalised;
  3. Lastly and most importantly successful SCI is built on having the right metrics in place that span across the entire business, without setting the right measures, business users will carry on making isolated knee jerk reaction type decisions.

An AMR Research study on improving the effectiveness of merchandising and promotional initiatives found that there is a clear need for greater SCI capabilities in organisations as all too often there is a disconnect between everyone involved and uncertainty on how best to measure the results. In this scenario the right SCI solution would be able to help improve effectiveness by providing one version of the truth, trade-off analysis capabilities and ensure performance is measured in a timely fashion based on the right set of metrics.

SCI technology is critical as it provides complete visibility and performance management capabilities for the entire value chain; thus connecting every day decisions across processes in real time for faster and more informed decision making.

Keeping in mind the three elements to achieving success,
what do you need to look for when it comes to SCI capabilities?

To truly get the highest level of benefits you need a combination of deep planning functionality together with a framework of correlated metrics and analytic capabilities in one tool. The benefits of this approach enable efficient planning and optimised decision making based on timely and accurate information, allowing organisations to manage their SC’s performance from end to end. By integrating key processes namely Demand, Supply, Product and Intelligence and providing a unique framework for cross functional collaboration, organisations can really start to realise the potential their SC has rather than the headaches it is currently causing.

Ultimately, the most forward thinking companies are using best of breed tools  that have the flexibility to adapt to the needs of each individual company while providing powerful intelligence, planning and analytics capabilities; this provides greater IT agility at a lower cost and a higher ROI.

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Per maggiori informazioni
TXT e-solutions
Ilaria Vincenzi
Marketing Executive

tel: +39 02 25771832




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