One of the themes of The Monthly Metric is that supply management analytics cannot measure performance and find inefficiencies if the data is faulty. And technology is critical to collecting and breaking down data.
That reality has become inescapable amid the exponential growth of enhanced technology and data generation. When teaching on the impact of data and technology on business, Jim Fleming, CPSM, CPSD, often cites a Venn diagram that illustrates the relationship between those elements. Among the three circles, the union area could be called “interdependencies,” but the label on Fleming’s diagram — results — is much more succinct.
“It doesn’t matter how sophisticated those elements are by themselves,” says Fleming, who is Manager, Product Development and Innovation at Institute for Supply Management® (ISM®). “You need the leadership, vision, culture, talent and appropriate governance. If you don’t have that supporting ecosystem, data and technology just won’t thrive.”
And that is the mindset behind ISM’s decision to combine its Data & Analytics and Technology committees, at least for 2024. “No matter what you do in the individual circles of data and technology, they have to be integrated with each other and the business,” says Fleming, a member of both committees. “It become impossible to do in a vacuum.”
The combined committees’ work will also focus on metrics, which makes this development an appropriate way for The Monthly Metric to review the year and muse on what’s ahead in 2024.
Nearly four years into the COVID-19 era, demand forecasting — which will be discussed in multiple feature articles in the upcoming January/February issue of Inside Supply Management® — is a discipline screaming for more accurate ways to track and measure. And many of the metrics of the future will focus on sustainability.
ISM will evaluate and potentially expand or streamline its portfolio of metrics, aiming to provide those that have become most relevant in a post-pandemic environment, Fleming says. CAPS Research, the Tempe, Arizona based program in strategic partnership with ISM and Arizona State University, plans to do the same for its highly regarded The Metrics of Supply Management report.
“Many supply management metrics are traditionally aligned to sourcing,” Fleming says. “but when you focus on an end-to-end model, that’s when you move from sourcing metrics to supply chain metrics.”
The motivation to combine the committees comports with findings in the 2023 Data and Analytics Study by Institute for Supply Management® (ISM®) in conjunction with North Carolina State University in Raleigh, North Carolina. Nearly three quarters (72 percent) of surveyed organizations feel their data has improved in recent years.
That suggests progress, but sentiment also focused on a desperate need for the right data systems and governance, business process capabilities and the personnel to execute it all. Predictive analytics is a glaring issue: The 2023 Data and Analytics Study found that 28 percent of surveyed respondents indicated that predictive analytics can do moderately complex or complex tasks, down from 32 percent last year and 34 percent in 2021.
Technology will help, and Fleming is bullish on artificial intelligence (AI), particularly with shipment visibility and demand forecasting. Regarding the latter, Fleming says AI could collect forecast data though monitoring social media: “What is the next big thing that is coming based on online traffic and trends?” he says. “If I’m trying to get a better prediction of future demand for a product that I’ll need, supply management has to find new sources.”
He continues, “There could be new metrics required not only to measure the production of a physical product, but also to get better handle upstream — with better predictability, or just driving more value.”
Possibly coming to The Monthly Metric: product Instagram traffic rate. When data and technology integrate for business results, the possibilities are endless.
Simply Having a Wonderful Metrics Time
Once again at the holiday season, at the top of The Monthly Metric’s “nice” list are the subject matter experts we speak with — and learn from — for each edition. Our stockings are full of thanks to Fleming and this year’s other contributors:
- Brian Barry, president at F. Curtis Barry & Company, a Richmond, Virginia-based warehouse operations and fulfillment consultancy
- Our friends at CAPS Research: Denis Wolowiecki, Executive Director, and Geoff Zwemke, Director of Product
- Nancy LeMaster, MBA, Chair of the ISM Hospital Business Survey Committee
- Tracey Smith, MBA, MAS, CPSM, president of Numerical Insights LLC, a boutique analytics firm in Williamsville, New York
- Michael Van Keulen, CPO at Coupa, a San Mateo, California-based business spend management technology platform.
In 2024, The Monthly Metric turns 8 years old — a testament to the value of our guest experts’ wisdom and readers’ support. Happy holidays!
To suggest a metric to be covered, email me at firstname.lastname@example.org.