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Overcoming Analysis Paralysis in Supply Chain Management

by Jon Gilbertson

Technology devices continue to become faster and more capable of amazing things.  The recent release of the 3rd generation iPad is just one example of a flood of computing devices that provide a tremendous amount of information. 

The options and capabilities seem to be endless. 

However, when you ask an iPad, Amazon Fire, or other tablet or smart phone user what features they actually use, the list is much shorter.  Similarly, only about 10% to 15% of sports utility vehicle owners actually take their SUV off the paved road. We see people pursue those things that provide the most capability, but they often don’t actually use it.

You’re probably thinking that this will be a discussion about overspending. Well, you’re close.  It’s about over analysis, specifically about supply chain analysis.  The root cause of having too much data is “analysis paralysis”, where you over-analyze or over-think a situation so that a decision or action is never taken, in effect paralyzing the outcome.  A decision is treated as over-complicated, with too many detailed options and everyone is seeking an optimal or “perfect” solution. 

The proliferation of personal computers and data processing speed has impacted the business world in a similar manner as the various personal technology devices have impacted the world.  Businesses can amass a wealth of data at lightening speeds coupled with a decline in the cost of collecting and storing data.  Along with the decline in the cost associated with collecting and storing data, companies move to collect as much data as possible with the intent of being able to make better decisions.

Technology has allowed us to store more data, crunch more numbers, and display information in more ways to more people.  How many times has someone in your organization told about all the reports they can run, have access to, or can manipulate?  But does this really matter if the reports don’t provide you with what you need – Quality vs. Quantity? Sure, my smart phone can do lots of things, but what is necessary, what is there for my entertainment, and what is actually used?

A little bit of everything, but not much of anything.

Don’t tell me about the reports and analytical capability – tell me about the conclusion, the ‘so what’, and what’s being done about it. 

You’ve likely heard about it in many perspectives to focus on the critical inputs and the items that are key to your business.  For supply chain management of professional services, the reports and information should represent 4 categories: Quality, Performance, Financial, and Continuous Improvement.  How satisfied is the consumer of the service, is the service level performing at or better than expected, and is it being done at a competitive total cost of ownership?  Most importantly, is the tracking or reporting you’re reviewing providing you with insight to understand what is being done to improve the overall experience for those using your service?

Yeah, there’s probably “an app for that”, but if all of your reporting can’t precisely provide you with key performance indicator of those 4 elements, what’s the use of having a library of reports and an endless sea of data fields to access? 

It’s time to break the hype cycle of what is available vs. what key measurements are needed.

For more information on this article, please contact Jon Gilbertson, VP Risk, Global Supply Chain & Procurement at SIRVA.