Being a small business in a big date world.
Businesses have more data at their fingertips than ever before thanks to the advent of big data. Innovation in data analytics has led to significant advances in the supply chain sector and heralds a new era where routine tasks and aspects of decision making are being automated through machine learning, AI and blockchain technologies.
The new era of supply chain management provides an unprecedented opportunity for SMEs to compete against competitors with the tools normally deployed by much larger enterprises. Although the tools are gradually becoming more accessible, the scale of big data means that SMEs could be forgiven for not considering how big data could play a role in their operations.
Ready, willing…but unable
A recent survey of Australian supply chain professionals by Telstra, The 2018 Data Driven Supply Chain Report, revealed that SME respondents saw more benefits from a data-driven approach to supply chain management than their enterprise counterparts.
The enthusiasm for big data is undeniable with the report finding that 65 per cent of survey respondents aspired to become more data driven in their business practices, and 57 per cent aspired to become more advanced in analytical skills.
Amidst this excitement however is a clear divergence between large and smaller businesses. Despite the huge potential provided by big data, many smaller supply chain operations reported that they are unable to harness the power of available data to generate useful insights for their businesses.
In fact, nearly half of the respondents (46 per cent) identified “lack of capability to transform data insights into business action” as the most significant challenge to properly implementing a data-driven supply chain strategy.
Despite being a go-to solution for many large enterprises, data-driven supply chains (DDSC) have come to represent a pipedream to many small businesses who don’t have the necessary resources, both financial and human, to undertake a major deployment.
Many smaller businesses simply do not have the necessary resources to invest and manage a DDSC capability. Investing in big data doesn’t just mean downloading a piece of software. Employee capabilities need to be built so they can analyse the large sums of data being produced.
Although SMEs are aware that data-driven supply chains can deliver tangible business benefits, the perceived lack of capability continues to discourage any involvement.
Friend in need
The risk for many SMEs is that they may be relegated to low-value, transactional relationships with their customers and suppliers, and are confronted with the potential threat of being left behind.
Small businesses could consider collaborating with partners who have the tech expertise and resources to leverage data to reduce supply chain costs in order to gain an edge over competitors. Allies in the technology sector can provide access to the data-driven supply chain as a service. And the market for specialist consultancies continues to grow, enabling smaller supply chain operations to gain the benefit of advanced data analysis services.
Working closely with larger players doesn’t need to be complex either. It could be as simple as subscribing to a more advanced data capturing service that can show you the movement of goods and people in your market.
In today’s economy, businesses are migrating from a purely transactional model to values-based partnerships. Collaboration is on the rise across all industries, and it requires organisations to actively leverage a partner’s point of expertise to drive efficiencies in the value chain.
SMEs have lots to gain from harnessing the benefits of a data-driven supply chain, but this does not suggest they need to be solely responsible in its execution. The beauty of collaboration is its ability to mutually benefit both parties involved. If business owners acknowledge they need improvement in a particular area, they should feel empowered to find a partner who will resolve this and complement their other offerings.
Neriman Kara, Principal, Supply Chain Growth, Telstra Enterprise