Becoming a Demand-Driven Enterprise
The key to becoming more agile when responding to demand signals is overcoming data and decision-making siloes that impact your ability to deliver. Here are 10 ways you can start to optimize your operations to become more predictive and proactive.
1. Get an enterprise-wide view of data. Artificial intelligence and machine learning can harmonize tangles of disconnected systems. Cognitive technology can crawl those systems and create a harmonized “golden data layer” that provides an up-to-date, accurate view of key metrics such as shipping lead times and inventory coverage.
2. Know your sources of volatility. Gain a holistic view of internal and external challenges—including market trends, competitors’ actions, supplier performance, and logistics cost drivers—and make this analysis an ongoing exercise.
3. Gather institutional knowledge. The Great Resignation spurred longtime employees to move on to new opportunities, while many others retired. Capture your best practices and processes today and ensure that expertise is not lost when experienced team members move on.
4. Address master data challenges. When neglected, issues with foundational master data—both static data (product categorizations) and dynamic data (lead times) can provide the wrong signals and impact product visibility, material sourcing decisions, and more. Good data hygiene pays dividends in decision making.
5. Focus on decisions, not tasks. A focus on decisions and outcomes helps ingrain strategic thinking into day-to-day operations. Task-oriented thinking can miss the big picture. For example, how can augmenting logistics decisions with data-driven insights help reduce or avoid less-than-truckload shipments?
6. Integrate outside data sources. When you draw on port congestion data, logistics marketplace information, and a wide range of other data sources that add insights beyond your own view, you can better adapt to changes in demand—for instance, by making adjustments automatically that maximize loaded miles.
7. Add decision intelligence. With more decisions to make in a day than time or people to make them, using artificial intelligence and machine learning to support and automate decision making is a necessary source of competitive advantage.
8. Maintain an innovation mindset. Digital native companies and agile startups delight their customers and disrupt markets by innovating. To keep pace, examine the value you provide and challenge yourself to find better ways to collaborate with customers, suppliers, 3PLs, and other stakeholders.
9. Embrace adaptive S&OP. The Demand Driven Institute defines Adaptive Sales & Operations Planning (S&OP) as “the integrated business process that provides management the ability to strategically define, direct, and manage relevant information.” All organizations could find benefits when undertaking this process.
10. Focus on continuous improvement. Response to the unexpected too often involves endless calls, slide decks, and spreadsheets. Instead of static emergency action plans, adopting digitized decision-making promotes a focus on continuous improvement. This helps improve decisions over time as your business evolves—as opposed to a “one-and-done” technology implementation mindset.
SOURCE: Fred Fontes, Head of Growth, Aera Technology