- THE MAGAZINE
Agile companies that can use their data to fine-tune their operations can stay ahead of the competition. For distributors, agility means being able and ready to make timely decisions in response to factors such as changes in material pricing, material availability, product mix demand patterns or competitor actions. But a surprising number of distributors are unable to take prompt action based on their data, which puts them at a disadvantage.
As Grant Thornton’s 2014 Supply Chain Ingenuity survey demonstrates, only 19 percent of the distributors we surveyed say their data is “very actionable.” This leaves 81 percent with room for improvement. Only a quarter (26 percent) of respondents can respond to supply chain pressures in one week, while nearly half (46 percent) take a month or more to respond. Nearly another quarter (23 percent) take three months or longer to react.
So, what’s the problem?
These companies lack the capability to handle large amounts of diverse data coming from various functions, business processes and silos. While data may be readily available, it often is considered outdated, unreliable or inaccessible for prompt decision-making. Issues range from the system not being designed or configured properly, not being used correctly, or not producing consistently accurate outputs. In some cases, decision-making is supported by silo- and function-based systems, which means business leaders from different functions frequently bring different answers to the same questions.
Most of these companies already have powerful enterprise resource planning (ERP) systems, but aren’t using these systems to the fullest extent. The good news is that not every problem requires a costly high-tech solution. Often the issues can be addressed through attention to business processes, configuration and master data accuracy.
Ultimately, the companies that are able to make solid, strategic decisions on a dime have a competitive advantage. Ask yourself this: If you’ve invested in an ERP, are you leveraging that investment for optimal performance?