A Calculated Approach to Predictive Analytics
When Each Piece Complements the Whole and ‘Failure’ Isn’t a Bad Thing
It wasn’t that long ago that the concept of predictive analytics was the stuff of thought leadership pieces and futuristic white papers.
The recently released 2017 MHI Annual Industry Report, “Next-Generation Supply Chains—Digital, On-Demand and Always-On,” however, places predictive analytics squarely in the category of here and now.
The new report, developed for the fourth year in collaboration with Deloitte Consulting, features numerous in-depth case studies. They cover a wide variety of technology advances, all with the hope of providing practical illustrations and realistic applications.
“It’s always good to see a concrete example,” said Randy V. Bradley, Ph.D., assistant professor of information systems and supply chain management at the University of Tennessee. “These are not just concepts, or technology that we’re talking about for the sake of talking about technology…. They give the reader something to chew on.”
That’s not all: The case studies in the report present predictive analytics not as a standalone concept, but as a component in the larger context of making better supply chain decisions overall.
“When we talk about these digital technologies, or the solutions identified in the report, there is no one solution that is likely going to create a major competitive advantage,” said Bradley, who was quoted in the report. “It’s going to be the combination, the amalgamation of these things and the complementary effects they have on one another, that will create a competitive advantage that’s sustainable. What good would it be to generate more data from sensors, but yet not have a predictive analytics platform that’s able to handle the proliferation of data that’s coming in, and then also be able to provide you insight that can become actionable in near time if not real time?”
Each year, the report has provided updates on innovative technologies—including predictive analytics—that were expected to have the most potential to transform supply chains; it’s based on a survey of 1,100 manufacturing and supply chain industry leaders. In 2017, according to the report, “a full 80 percent of survey respondents believe the digital supply chain will be the predominant model within five years. Another 16 percent say it already is.” In addition, though only 17 percent of respondents have predictive analytics in use today, 57 percent believe it could be a source of either disruption or competitive advantage within the next decade (up from 38 percent in 2015).
By Fiona Soltes