What is the Supply Chain?
Happy Thanksgiving to those who celebrate! In honor of this holiday, we will explore how data interacts with the thing that gets the turkey on the table today night – the supply chain. The supply chain is how things get from where they are produced to the grocery store. It is the reason why you have apples in the grocery store year-round and why you don’t have to go to Florida every time you want some oranges. The supply chain is a constant prediction model of who will want what good when, and how much of it. These days there is an immense amount of data that is involved in the supply chain to make it more efficent and just overall better both for the business and for the consumer.
Examples
Amazon does this really well, for a simple example of how they excel at it let’s take a snow shovel. Right before the snow season starts they predict that people in the colder parts of the world will want a snow shovel more than those in the warmer parts. So, they place their snow shovels nearer to the colder parts of the world reducing shipping time for the people in the northern parts but increasing shipping time for those in the southern parts. Amazon has deemed this ok because they realized that the benefit of the shortened delivery time for the northern customers them by doing this is greater than the loss they incur from the people in the south having a longer delivery time. This is where data comes in – to make that decision.
Another example is that famously UPS doesn’t make left turns. Why do they do this? To save fuel. According to an article by CNN(found here), by doing this UPS saves millions of gallons of fuel each year and reduces its emissions equivalent to over 20,000 passenger cars.
My Take
Think about that by conducting some studies and writing some code both UPS and Amazing were able to save huge amounts of money all by using data and making data-driven decisions. Not only that but they were able to make their customers happier on average because they got their deliveries done faster and more efficiently. Just one more way data can save the day!
Conclusion
All in all, data can be tremendously helpful for businesses espiecially in their supply chains. It can help businesses save money and-more importantly- it can help customers be more satisfied. This all goes to show the power of data. If you simply take the time to conduct a survey, analyze the results, and act upon those results, you can save millions of dollars and be much greener like UPS was. Thank you for reading and happy Thanksgiving once again to those who celebrate!