CSCOs, Listen Up - It’s Not the Data’s Fault


To all Chief Supply Chain Officers - it’s time to take control of the data that drives your business and adopt a new, more trusting, mindset. Too often I hear the cop outs… “those are projections from sales and finance — their data cannot be trusted, we hope to have clean data soon, then we can move forward” to “I don’t have time for another S&OP meeting about whose forecast data is best” to “are we really going to fund another data project that will take longer, cost more, and have minimal impact.”

The truth is that this kind of mindset will leave you in the past. Already, 37% of CPG firms are using data and AI in supply chain planning, and an additional 41% expect to do so in the next 3 years.

Do you really want to stand by while data and AI-enabled supply-chain management has enabled early adopters to improve logistics costs by 15 percent, inventory levels by 35 percent, and service levels by 65 percent, compared with slower-moving competitors?

There are three areas where changing your attitude and processes will help your business embrace the data that will tune your S&OP to a higher level of performance.

1.  Does your data suffer from siloed ownership?

Too often, data handed off between different departments is distrusted and gets modified, leading to misalignment between finance, operations and marketing. It’s the age-old challenge of driving a shared, unified view of demand that will sync up all parts of the business. As the CSCO, it’s critical that you take ownership of this fundamental pillar that drives efficient operations.

2. Are you still spreadsheet driven?

Even within departments, there is grumbling and “white noise” around data accuracy, which is not surprising when the planning process is using the same old spreadsheet-based rules that are not supported by machine learning, ripe for manual error, and take forever to process. So oftentimes, data is manually massaged till it “feels right”. But is the data really inaccurate? How inaccurate? And are you using the right data? These are all questions that need to be owned and fixed via data management systems that can identify data inaccuracies in a timely fashion. Don’t be complacent and walk away.

3.  Are you looking at new ways and partners to help?

Look outside your organization for solutions. Today, a whole new breed of data and forecasting solution providers are ready to help. This is not like a multi-year investment in your ERP. Instead, these providers can help pinpoint areas that would benefit most from better underlying data management and focused forecasting improvement, be that for more accurate overall demand forecasting to underlie the planning process, or for targeted areas of improvement like pricing and promotion optimization or near-term demand sensing and order fulfillment. These providers will start with a pilot that can produce results in just 3 months.

Consumer behavior has been changed by the pandemic. Returning to old expectations of demand behavior that could be planned for with fixed rules in rudimentary spreadsheets will not work. The supply chain has also been impacted - by weather, shortages, and other factors that are difficult to rapidly adjust for. So, using available data, more data sources and advanced analytical capabilities is the ONLY way that CSCO’s can stay a step ahead in this new world.