The manufacturing industry is one of the most complicated and demanding industries due to the complexity of operations and production. Many companies strive to simplify the systems to minimize the costs and increase the returns. This also includes reducing the waste of time, efforts, and inventory. So, it has become imperative to use big data and data analytics to be more data-driven. This approach provides you with insights into your system and processes for better decision making and problem-solving.
Challenges faced by manufacturing companies
Manufacturing companies face many challenges and concerns which ultimately slows down their operations and affects their ROI. Here are a few of the top challenges that manufacturers are dealing with.
- Keeping the production costs low
- Maintaining the product quality at lesser costs
- Sustaining the quality of after sales services
- Dealing with the complexity of operations and processes
- Keeping pace with modern technologies
- Complying with laws and regulations
Why adopt Business Intelligence in Manufacturing?
The manufacturing industry is constantly changing due to technological advancements. Companies are searching for ways to gain a competitive edge against their global competitors. Data-oriented systems are taking place of the traditional ones. As companies are facing more and more challenges as mentioned earlier, the demand for simple, data-driven insights is greater than ever.
Manufacturing companies are very data-intensive but often they are not able to use the data wisely. Huge piles of data lie idle with the companies. Business Intelligence (BI) boosts the potential of these companies to make use of the collected data in a productive way. BI can simplify decision making and problem-solving. All the areas of manufacturing get transformed in a fruitful way when BI takes the reins.
Here are some functions which gain the most out of Business Intelligence in manufacturing.
1. Increases Operational Efficiency
With the help of BI, you can not only access but also understand huge volumes of data so that you can accelerate the pace of your operations and processes. With all the insights in hand, you can easily analyze the team performances and take corrective measures in case of any discrepancies. Incorporate financial and product models for in-depth analysis of product development and financial measures. Be it making sales strategy, forecasting or meeting market demands, BI can do it all and that too with more transparency and simplicity.
2. Streamlines Supply Chain and Logistics
With BI in place, you can evaluate the supply chain logistics daily and analyze the data to ensure timely deliveries and high-quality service. You can optimize the value of suppliers by giving them timely and insightful feedback on their services. With the fluctuation in supply and demand, you can keep a track of freight costs. With greater insights into each shipment, you can assess shipment performances and accordingly negotiate contracts.
3. Allows Informed Decision-Making
With multiple sources of data, manufacturing companies have loads of data tying idle. This asks for proper management, storage, and application of all these data. This is where BI comes to your help. With Business Intelligence, you can access large, cumbersome database and transform it into insightful and easy-to-understand pieces of information. BI tools present this information in the form of visualizations like graphs, trends, charts, etc. so you can take more informed and concise decisions. BI also helps you in forecasting and testing ‘what if’ scenarios.
4. Helps in Inventory Control
For manufacturers, inventory of finished goods in hand is the biggest asset. They also have an inventory of raw materials, replacements, spares, etc. which is crucial to manage too as inventory regulates the performance of the company. With BI, you can track and reduce the inventory costs across location and time. Keep a track of turnover rates, product margins, and defectives too. This will help you in inventory forecasting too.
5. Optimizes Financial Management
Business Intelligence in manufacturing can be used for various analysis like P&L, sales, inventory, assets, etc. Thus, you can get an idea about exact ROI from each stage. Maximizing profit margins is one of the most important yet complicated goals of manufacturing companies. You can do this by both external profit building and internal cost reductions. BI helps you in identifying new ways to generate revenue and save costs by providing an in-depth cost-benefit analysis. With dashboards for various elements like Account Receivables and Payables, Sales, Purchases, Asset Management, etc., you can have in-depth analysis of each of these factors.
The manufacturing industry is increasingly adopting BI in all its operations. The role of Business Intelligence in manufacturing operations is becoming significant. Companies are searching for solutions that optimize their complex processes while maximizing their profit margins too. BI in manufacturing companies is opening ways of making the manufacturing intelligence more acceptable. Business Intelligence enables you to do with what you have on hand for taking your business forward.