Summary

In a recent study of supply chain business intelligence (BI), Ventana Research found that companies struggle to realize the benefits this technology can deliver in the areas of customer service and visibility of inventory. Users told us that data access is difficult and takes too long and that the systems serving parts of the supply chain or elements in the company’s product mix are not well-integrated. The research also revealed a demand for real-time data acquisition and reporting. Barriers to quick, easy data access to supply chain BI analysis include unwieldy disparate data warehouses and multiple systems within the supply chain.

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Many enterprises don’t utilize supply chain business intelligence technology to its full potential, according to a recent study from Ventana Research. The research, sponsored by Cognos and Salient and conducted with the assistance of media sponsors BusinessIntelligence.com, DM Review, Intelligent Enterprise, Montgomery Research, Software Magazine, Supply & Demand Chain Executive and Technology Evaluation Centers, surveyed and analyzed responses from 427 qualified organizations in manufacturing, services and public sector industries.

The study examined what BI capabilities companies have, what users expect their future needs to be, the degree of satisfaction users have with current supply chain BI analytic applications and the extent of adoption of newer BI technologies. The research found that nearly half of the respondents’ companies use spreadsheets or other desktop applications for supply chain BI, while nearly one-third use applications developed in-house. Interestingly, these two groups had the most complaints about the current state of BI technology in their organizations.

Respondents reported numerous difficulties with data access, including the length of time it takes to obtain information and the limited integration between different systems serving various parts of the supply chain or elements in the company’s product mix. On average nearly one-fourth (22%) of respondents said they need real-time data acquisition and reporting capabilities but are not getting them. The operations that most need real-time data are those closest in the process to final demand, manufacturing and warehousing. Many of these operations require intraday or daily data updates. To determine what performance measures respondents consider important to supply chain BI, our survey asked what metrics they have access to or work with. Slightly less than half of the respondents reported that they have access to critical metrics, such as profitability and process data. We found these findings particularly of concern because other results show that among functional areas using supply chain BI, the most use is by finance groups and executive management, which need to make key decisions that affect the company. It was not surprising that almost one-third of respondents said the most desirable feature of supply chain BI systems is simplified integration of data from all sources. At the same time, three-quarters of the sample said that multiple instances of supply chain systems and disparate data warehouses make data integration difficult. Most respondents’ companies have not yet begun to correct the integration problem caused by multiple instances of supply chain BI.

Assessment

Ventana Research believes that to connect processes with performance goals, companies need BI capabilities, including metrics, key performance indicators (KPIs), executive dashboards and advanced reporting. They must do more than provide reports on basic operational metrics; they must enable access to aggregate data definitions and real-time supply chain information. Without BI, it is impossible to correlate process outcomes to corporate performance goals or to apply operational metrics to continuous process improvement. We also believe that integrated, real-time supply chain information is no longer a distant ideal but a realistic objective and a key step in moving a company toward a lean supply chain. Barriers to this include a lack of quick, easy data access, unwieldy user interfaces, disparate data warehouses, multiple systems within the supply chain and overuse of spreadsheet technology for supply chain BI analysis. Ventana Research recommends companies evaluate the data integration and advanced user interface capabilities of dedicated BI platforms to correct this pernicious failing.

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