What is Business Intelligence?
Business intelligence (BI) is a method of collecting and analyzing business data to uncover valuable insights for making better-informed business decisions. It turns raw data from different sources into a structured, visual medium such as charts, spreadsheets, and maps, enabling decision-makers to monitor daily business workflows.
According to Accenture, more than 60% of the largest consumer goods businesses will rely on artificial intelligence to manage their supply chain operations by 2024.
In this article, we’ll discuss the role of business intelligence in supply chain management and how BI tools help businesses and shippers achieve their logistics goals.
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Why Business Intelligence is Important in the Supply Chain
Here are the five key reasons that high-performing businesses use business intelligence to identify and solve their supply chain issues.
1. Get Real-Time Insights Into Emerging Risks
Every supply chain is susceptible to risks from various sources, from losing important suppliers and customers to logistics inefficiencies. And there is risk associated with every business decision that can impact a company’s ability to achieve its supply chain objectives. For this reason, organizations rely on business intelligence solutions to monitor and mitigate these risks.
BI tools collect large amounts of data from internal and external data sources (e.g., warehouses, 3PL fulfillment centers, ERP software) and utilize data analytics techniques to predict trends and risks in real-time. For example, it can prevent stockouts and inventory waste by monitoring procurement, customer orders, and inventory management data to identify healthy safety stock levels.
Sifted’s rate analysis feature helps you understand the impact of carrier rate changes on your business so you can take the necessary steps to reduce shipping costs.
2. Easily Track Important KPIs
Business intelligence software allows supply chain managers and other stakeholders to create personalized KPI dashboards, reports, and alerts to establish short- and long-term logistics objectives.
Supply chain management dashboards let you track important logistics KPIs (key performance indicators) like warehousing costs, inventory accuracy, and transportation costs from a single location. Similarly, you can use KPI scorecards to evaluate your company performance, such as whether quarterly sales and profitability goals are achieved.
The BI solution then uses predictive analysis techniques and machine learning algorithms to forecast the organization’s probability of achieving these milestones based on historical and current data. Managers can drill down into the data to identify the causes of the issues and streamline processes to make them comply with the organization’s logistics objectives.
Sifted offers multi-carrier visibility by allowing you to compare your performance against several carriers based on key metrics such as shipping charges, package count, and average cost per pound.
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3. Make More Informed Decisions
Business intelligence and big data tools help take the guesswork out of decision-making by gaining visibility into supply chain operations. They integrate with an organization’s existing supply chain management systems to deliver real-time data-driven insights. Users can manipulate this data to identify the causes of problems and make appropriate decisions to optimize supply chain operations.
For example, IoT (Internet of Things) devices like sensors and RFID enable warehouse managers to keep track of the exact location and status of packages. Similarly, these tools are used to detect early signs of machine malfunctions, allowing managers to reduce unexpected downtimes.
Sifted helps you optimize network distribution by simulating package delivery from different warehouse locations. This way, you can choose a warehouse that offers your customers fast delivery times and lower shipping rates.
4. Gauge the Overall Health of Your Business
BI software gives a 360-degree view of business operations, helping companies identify trends or anomalies, measure sales, and discover areas of concern. Its powerful data management and analysis capabilities enable you to simulate the effects of suppliers, competitors, and customer actions. You can test different scenarios and generate alternative outcome models to get comprehensive knowledge of your business and of the factors that affect it.
Sifted Score uses machine learning algorithms to identify trends and anomalies in your shipping data. It measures the performance of your shipping operations across 20+ factors, and summarizes in a single score.
5. Set Realistic Goals for the Future
While you can set up a new supply chain BI dashboard within a week, business intelligence takes years to mature. It needs time to draw and build datasets from multiple sources to truly understand how historical and current data relates to your supply chain operations and to fine-tune its predictive models using newly available data.
Proper use of business intelligence tools requires you to define your BI strategy’s scope and set clear milestones to work towards. As you accumulate small wins, you’ll get better at using your BI solution to meet goals and bridge the gaps in your supply chain.
Sifted’s Marketplace Intelligence feature lets you visualize your Amazon sales data on a map, enabling you to discover hidden patterns that might require immediate action.
Stay on Top of Your Logistics with Sifted
Business intelligence tools collect and process data from business operations and help organizations predict future outcomes, improve decision-making, and adapt to changes in the business environment.
Sifted Logistics Intelligence is an advanced business intelligence tool that makes all your shipping data available in one place. It simplifies logistics management and helps you reduce costs using AI-powered demand forecasting.
Gain complete visibility of your shipping operations. Get a free demo from Sifted!