Supply Chains In Practice Networking Event

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Shaping the Future

Supply Chains In Practice

Networking Event

Data Driven SCM

Big Data for Big Breakthroughs

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Explore from 3 perspectives…

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Landscape overview

Matthew

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Enabling the data driven SC

Andy

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Join the discussion…

#SCinPractice

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Data-Driven Supply Chain Management: Big Data for Big Breakthroughs

Matthew Burton, Partner Warwick June, 2015

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17 June 2015 Data-Driven Supply Chain Management: Big Data for Big Breakthroughs Page 5

Most business leaders are familiar with analytics as a topic but uncertain on it’s definition and application

Our advice

►Analytics is about decision-making

in a complex, multi-connected world

►Mathematical models must be

pragmatic and feasible

►Technology alone only provides

enablement whilst analysis alone does not guarantee results

The hype

►Current “buzz-word”

►Marketing hype and books

►Skewed focus on software as the route to creating value

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81% agree that data should be at the heart of all decision making but only 31% have restructured to help do this.

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Most companies are still focused on backward looking analysis

Source: Gartner, EY research

BI and Analytics Maturity Model

Traditional financial reporting of supply chain costs and performance

SC and Logistics Visual control dashboards

Examples

Forecasting and automated replenishment planning Cost to Serve scenario planning

Integrated demand sensing utilising promotion plans, pricing and weather data and

integrated with supply and capacity planning Descriptive Reporting What happened? Diagnostic Analysis and Visualisation

Why did it happen?

Predictive Analytics

Where are we headed?

Prescriptive Analytics Future focused Historic focused What should we do in future?

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Supply chains already generate their own Big Data without needing to wait for internet of everything

What are your sources of data?

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Example: Supply chain synchronisation

Actual demand supply cycle – showing distinct lack of synchronisation despite heavy investment in tools

Revised demand supply cycle – synchronised planning parameters delivering stability with lower inventory

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►1 0

Optimisation

•Creation of capacity evelled optimisation blueprint •Calculation based on unique algorithm Optimisation Forward View •Forecasting of capacity usage to identify resource needs and bottlenecks

•Scenarios based on different treatment cycles

Forecasting

Trend Monitoring

•Trend analysis for all capacities within the

hospital eg theatre, beds, surgeons Diagnostics Agenda: 'ORTHOPEDIE A' SubAgenda: '-- All --' Appointment-Codes: 'DDNS', 'HNC', 'KNC', 'MNC', 'NC', 'NCK', 'NS', 'RNC', 'SNC', 'VNC' 0 10 20 30 40 50 60 2 2 /0 6 /2 0 0 9 2 9 /0 6 /2 0 0 9 0 6 /0 7 /2 0 0 9 1 3 /0 7 /2 0 0 9 2 0 /0 7 /2 0 0 9 2 7 /0 7 /2 0 0 9 0 3 /0 8 /2 0 0 9 1 0 /0 8 /2 0 0 9 1 7 /0 8 /2 0 0 9 2 4 /0 8 /2 0 0 9 3 1 /0 8 /2 0 0 9 0 7 /0 9 /2 0 0 9 1 4 /0 9 /2 0 0 9 2 1 /0 9 /2 0 0 9 2 8 /0 9 /2 0 0 9 0 5 /1 0 /2 0 0 9 0 100 200 300 400 500 600 Count 10% 25% 50% 75% 90%

Example: Hospital BI optimisation

Needed resources for planned CTC's

0 200 400 600 800 1000 1200 1400 Estimated Forecast WIP Forecast WIP External WIP Scheduled Trend Forecast DynamicPlanner® Screenshots

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Ernst & Young LLP

Assurance | Tax | Transactions | Advisory

www.ey.com/uk

The UK firm Ernst & Young LLP is a limited liability partnership registered in England and Wales with registered number OC300001 and is a member firm of Ernst & Young Global Limited.

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Enabling and delivering

Analytics Capabilities

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Confidential |

Delivering operational improvements through the use of analytics Concentra

• An analytics company that focuses on delivering operational improvements

• Formed in 2008, a team from A.T. Kearney merged with a software development

house

• We are 85 people strong with our head office near London Bridge

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Confidential |

Supply chains are becoming broader in scope, more complex and more difficult to manage

Manufacturing Tier 1 Impact

Warehouse Replenishmen

t

Tier 2 Impact Customer

Delivery Customers

Operational Planning and Execution Systems are Integrated…. but visibility of supply chain performance could be a lot better. Why is this?

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Confidential |

• Design best-in-class business processes and organisational structures to turn the supply chain function into a high-performing strategic asset

• Maximise product and customer profitability by modelling trade-offs associated with price, product portfolio diversity and direct material

complexity

• Get new insights and visibility of the activities and costs associated with converting materials to finished goods and delivering them to customers

• Full end to end network cost management

• Optimise inventory levels by analysing the flow of product through the supply chain and setting material and product movement policies

HOLISTIC SUPPLY CHAIN MANAGEMENT

The data and Information required tends to be cross-functional or multi-system in nature and multi-time dimensional

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Confidential |

Demand Planning Process

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Confidential |

Supply Planning Process

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Confidential |

Inventory Planning Process

Example dashboards

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Confidential |

Spend Analysis

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20 Confidential | Transaction Data Transactional ERP • Sales • Inventory • Stock movements • Production Planning systems • Sales forecasts • Inventory policies • Planned production

• Planned stock movements

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21 Confidential | Data Management Analytic s Visualisatio n Develop a reliable single data set with latest information that is structured to provide fast

analysis.

Build reporting and modelling tools to answer questions about the past, present and future .

Create an accessible environment to publish analysis and share insights.

INTERNET OF THINGS

MES Systems WMS Systems Tags in Retail

Scalable

Consistent

Secure

Standardised

Fast

Extending the data sources and the detail

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Confidential |

Manufacturing Analytics and Excellence

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Confidential |

FLEXIBLE HIERARCHIES CUSTOM DASHBOARDS

Visualising and Analysing

GRAPHS INNOVATIVE VISUALISATIONS

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Confidential |

Sharing information and truly collaborating….cloud based analytics

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Using Cloud based solutions to create industry level information • Industry data • Single information systems • Supply Chain partners – right information to the right people at the right time

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Supply Chains in Practice

Professor Carsten Maple

16 June 2015

WMG

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Sharing Data through the Supply

Chain

"Sharing information with

suppliers is essential”

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Securing the Supply Chain

• UK Security Breach Investigations Report – 18% of attacks were through a business partner • ISF Report

– 40 percent of the data-security breaches arise from attacks on their suppliers

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Risk Management Strategies

• Risk is commonly defined as the combination of the likelihood or probability of an event

occurring and its impact or consequence. The classical model for risk can be defined as: Risk = Likelihood * Impact

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Threat Actors

• A number of motivational factors exist and have to be applied to each of the threat

actors, these motivations are: • Crime (incl. Financial)

• Espionage (State & Industrial) • (H)activism

• Terrorism • Warfare

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Considerations when sharing data

in the supply chain

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Considerations when sharing data

in the supply chain

• How likely are your partners to be breached due to the aforementioned threat actor

motivations?

• How do your partners manage your data and theirs?

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Risk Management Strategies

• Reduce. Reduce probability of risk occurring or the impact of the event should it occur.

• Contingency. Action is planned but only implemented should risk occur.

• Transfer. Reduce financial impact of threat (insurance or clauses in contract.)

• Accept. Take no action. Chosen because risk has low probability and/or low impact. Also if cost of action exceeds impact.

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Risk Management Strategies

• Avoid. Action planned so no impact on the project or probability of occurrence is zero.

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Risk Management Strategies

• Avoid. Action planned so no impact on the project or probability of occurrence is zero.