Inbound Management

Achieving Supply Chain Predictability: Three Predictive Analytics Strategies

Grant Sernick
November 28, 2023
min read
Achieving Supply Chain Predictability: Three Predictive Analytics StrategiesAchieving Supply Chain Predictability: Three Predictive Analytics Strategies

In today's world of supply chain complexity and constant disruptions, predictive technology has the potential to be a transformative tool for businesses seeking efficiency and resilience. According to a recent survey, the logistics and supply chain industry is poised to witness the integration of approximately $41 billion worth of data-driven gadgets by 2027, emphasizing the increasing importance of predictive analytics. However, it's not just about collecting data; the future success of shippers and BCOs relies on their ability to harness supply chain analytics effectively.

The capacity to anticipate challenges, plan ahead, and optimize operations is crucial in a landscape where supply chain disruptions are both frequent and unpredictable. A lack of clear visibility and real-time data compounds these challenges, making it an ongoing struggle for businesses to maintain smoothly running supply chains. In a study conducted by S&P Global, 46% of surveyed participants, including shippers and carriers, identified delivery delays, and 39% pointed to rising fuel costs as the two most significant issues they aim to address with technology.

By embracing the power of predictive analytics in supply chains, businesses can proactively anticipate disruptions, make informed decisions based on data-driven insights, and optimize their inventory levels. This article presents the three key strategies that utilize predictive analytics to instill predictability into your supply chain operations: demand forecasting, inventory optimization, and supply chain risk management. We also look at how 3rdwave's suite of solutions can serve as your reliable partner on the path to creating a more predictable and resilient supply chain.

Predictive Analytics: An Invaluable Asset in a Complex Supply Chain

In today's dynamic and often unpredictable supply chain landscape, predictive analytics stands out as a game-changing asset. Despite the increasing frequency and unpredictability of supply chain disruptions, businesses struggle to leverage their extensive data effectively. This is primarily due to the unstructured nature of the data, which poses a significant challenge for both human analysis and artificial intelligence.

Supply chain predictive analytics aims to transform raw data into meaningful insights, predicting future trends and events with precision. However, a major hurdle is the disconnection between systems oriented around product management, like ERPs, and those focused on the supply chain, such as TMSs and forwarder systems. This disconnect results in incompatible systems that fail to provide a comprehensive understanding of the supply chain dynamics.

Enter 3rdwave – the solution bridging this critical gap. 3rdwave uniquely understands both the product world and the intricate details of supply chain and shipments. By integrating these disparate systems, 3rdwave creates a harmonized environment, enabling AI and advanced algorithms like LLMs to effectively layer on top. This integration not only simplifies the complex data landscape but also empowers businesses to make informed decisions, enhancing agility and resilience in supply chain operations.

Despite the potential challenges in adopting predictive analytics, including implementation complexity and cost, 3rdwave offers a streamlined approach. This approach democratizes access to advanced predictive analytics, equipping businesses with the essential tools they need to excel in modern supply chain management.

In essence, 3rdwave is not just a tool but a transformative solution, enabling businesses to harness the full potential of their supply chain data and pave the way for proactive, data-driven decision-making.

Three Strategies to Optimize Operations Through Supply Chain Predictive Analytics

In today's dynamic and ever-evolving supply chain landscape, achieving predictability is not just a goal; it's a necessity. This section will delve into three pivotal strategies that leverage supply chain predictive analytics to bring about remarkable transformations in international shipping. The journey to supply chain predictability is paved with demand forecasting, inventory optimization, and supply chain risk management, all powered by the insights harnessed from predictive analytics.

Strategy 1: Demand Forecasting

Accurate demand forecasts are the lifeblood of efficient supply chain operations. Knowing exactly what and how much your customers will need is the key to preventing overstock or stockouts, reducing carrying costs, and ensuring customer satisfaction.

With its ability to sift through historical data and real-time information, predictive analytics plays a pivotal role in enhancing the precision of demand forecasting. By identifying patterns, trends, and anomalies in data, predictive analytics empowers businesses to make forecasts that are not only accurate but also adaptable in the face of changing market conditions.

For instance, a textile manufacturer implemented predictive analytics in their supply chain. By analyzing historical data and market trends, they accurately predicted a surge in demand for a specific material used in their products right before the holiday season. This allowed them to adjust production schedules and order the necessary materials in advance, preventing stockouts and ensuring timely deliveries.

Strategy 2: Inventory Optimization

Maintaining optimal inventory levels is a balancing act that international shippers can achieve through using supply chain predictive analytics. This strategy revolves around keeping just enough inventory on hand to meet demand without incurring excess carrying costs.

Predictive analytics excels in identifying trends and patterns in inventory management. It not only helps businesses optimize their stock levels but also ensures that products are stocked in the right locations, reducing lead times and enhancing customer satisfaction.

For example, an e-commerce giant leveraged supply chain predictive analytics to optimize its vast inventory. By identifying product trends and regional demand variations, they maintained optimal stock levels in different distribution centers, reducing holding costs and speeding up order fulfillment, leading to higher customer satisfaction.

Strategy 3: Supply Chain Risk Management

In a world where supply chain disruptions are as unpredictable as they are costly, supply chain predictive analytics has become an indispensable tool in risk management. It empowers businesses to proactively identify, assess, and mitigate potential supply chain risks.

Predictive analytics helps anticipate potential disruptions and risks by monitoring factors such as weather conditions, geopolitical events, and supplier performance. It allows businesses to create contingency plans and ensure continuity in their supply chain operations.

A global electronics manufacturer, for example, relied on predictive analytics to mitigate supply chain risks. By monitoring geopolitical events and their potential impact on component supplies, they developed contingency plans and diversified their sourcing options. When a trade dispute disrupted one supplier, they smoothly shifted to another, ensuring uninterrupted production.

An Effective Supply Chain Predictive Analytics Strategy Begins with the Right Technology Architecture

Partnering with the right technology architecture provider is paramount to embark on a successful journey toward predictability in your supply chain. This is where 3rdwave comes into play, offering a comprehensive suite of solutions designed to address the core strategies outlined in this article.

  • Demand Forecasting: Thanks to 3rdwave's Master Data Management system, we equip businesses with advanced supply chain predictive analytics tools that help generate precise demand forecasts, ensuring you can meet customer needs while minimizing inventory costs.
  • Inventory Optimization: With 3rdwave's suite, you can seamlessly optimize your inventory levels, identify trends, and manage your stock efficiently. This not only reduces carrying costs but also enhances customer satisfaction.
  • Supply Chain Risk Management: 3rdwave's iTMS (International transportation management system) is equipped with various functions like Shipment Planning, Port Management, Freight Audit, and more. These tools enable you to proactively anticipate, manage, and mitigate supply chain risks, ensuring your operations remain resilient in the face of disruptions.

By choosing 3rdwave as your trusted platform, you're not just implementing supply chain predictive analytics; you're embracing a comprehensive solution that empowers your business to thrive in the unpredictable world of international shipping and logistics.

Empower Your Supply Chain with Predictive Analytics

In a world where predictability is the cornerstone of a resilient supply chain, 3rdwave stands as your beacon of reliability and efficiency. Their suite of solutions, including demand forecasting, inventory optimization, and supply chain risk management, underpinned by predictive analytics, offers the transformative power you need.

Don't leave the future of your supply chain to chance. Take control and contact 3rdwave today to learn more about the difference predictability can make. Your journey to a more efficient and resilient supply chain starts here.

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