What Business Intelligence Software Can Do For Manufacturing Companies
Manufacturing businesses are constantly driving for better performance in multiple arenas: higher returns on invested capital, lower product and overhead costs, better asset utilization, greater customer retention, higher perfect order rates, reduced working capital needs…the list goes on. More and more manufacturers are adopting enterprise performance management software and business intelligence analytics to help reach their performance goals. Business intelligence enables manufacturers to analyze the effectiveness of their lean manufacturing efforts, assess the efficiency their production operations, and pinpoint any variances that may occur that cut into profits.
Real-time inventory optimization models help manufacturers keep expenses at a minimum. But in order to run lean and NOT run out of necessary parts/product, procurement professionals need to know exactly when replacement parts and components need to be reordered. They also need to be able to pinpoint instances of excessive ordering and stop them from happening again. Business intelligence software allows manufacturers to set inventory targets and to identify outdated inventory that need to be taken care of. In addition, companies can leverage BI software to accurately plan and optimize their inventory based on historical sales, shipment, point-of-sale and other performance data such as trends in inventory turns. Today’s more advanced, predictive analytic applications within business intelligence software offer statistical forecasting right down to the product SKU level. This helps ensure a “right-sized” inventory for every product.
The real-time visibility and automatic alerts that are tied into most business intelligence solutions also give warehouse managers the insight they need to make better decisions and ultimately drive down safety stock, reduce lost sales and minimize the costs and time related to inventory management.
Real-time supply chain management and analysis.
In order to ensure the most effective and efficient manufacturing supply chain, which in today’s economy is often global, supply chain information must be 100% accurate and easily shared among all vendors and suppliers. Not only does BI give manufacturers a holistic view of their supply chains at all times, it allow organizations to better manage spending and their supplier networks by identifying are actually holding up your supply chain or costing you more to work with. And, such operational analytics can help businesses assess and optimize assets in the areas of cash, inventory and both warehousing and manufacturing capacity.
More accurate planning and forecasting.
In a demand-driven manufacturing environment where the focus is on meeting customer expectations AND minimizing costs, accurate demand forecasting is critical. By adding performance analytics companies can better anticipate shifts in customer demand and manage their inventory accordingly. Predictive business intelligence applications can be used to produce an accurate, statistics-based demand forecast that leverages current, historical and external information. The software can help manage outliers so they don’t heavily influence your forecasting and pull in multiple years of historical data to create the most accurate plan possible. The end result of improved forecast accuracy is reduced inventory costs, better customer service (the products you need are always in-stock) and improved cycle time and fill rates.