Business Intelligence Paired with Insights Lead to World-Class Results
Innovation is a key driver of corporate success, fosters growth and helps businesses adapt to the challenge of disruption.
Innovation can improve existing products, services, processes and/or methodologies or make new ones. Think of how fingerprint scanners improve smartphone security. And how the new iPhone revolutionized communications in the first place.
Innovation also can make the old obsolete. When’s the last time you used your Walkman or iPod?
Leading enterprises always want to be at the forefront of innovation, not lagging behind. You want to be the ones inventing the iPod, not the Microsoft Zune.
To achieve this, leaders are going to have to understand how business intelligence leads to insight, which leads to innovation – and how to repeat the business intelligence -> insight -> innovation cycle (BI->I ->I) continuously.
For supply chain leaders battered by disruption, supply chain innovation is crucial.
Supply Chain Leaders: Beset by Disruption
Unfortunately, for the last four years innovation has been on the back burner as companies and supply chain leaders have struggled to deal with uncertainty and the new normal of nonstop disruption.
This is understandable. The rate and pace of disruption was increasing even before the pandemic of 2020.
Just looking at one metric, 40-foot container rates, shows a fluctuation from less than $1,500 pre-pandemic to $20,000. After dropping again to less than $1,500, they’re headed near the $4,000 mark again.
Think of all the other things that have changed in the last few years. Focus on supply chain resilience has increased. Chief supply chain officers are joining corporate boards. Consumer demand has radically shifted. And then shifted again. And then shifted again.
Supply chain leadership re-evaluated just-in-time replenishment. Unfortunately, just-in-case replenishment resulted in too much overhead and high costs.
Getting inventory just right, on the other hand, is extremely difficult in a world of nonstop disruption.
Embrace Disruption with Business Intelligence, Insight and Innovation
Now is the time for insightful leaders to embrace nonstop disruption as the new normal. Leadership, especially supply chain leadership, must proactively set innovation as a clear priority.
That will require the process of business intelligence -> insight -> innovation (BI->I ->I).
True business intelligence provides companies with an understanding of real-time performance.
Insight is a deep understanding of business intelligence and how things are evolving. This understanding identifies patterns, uncovers hidden connections and grasps how things are changing.
Insight provides the foundation for innovation by helping organizations recognize unmet needs, customer pain points, emerging needs and market gaps.
Innovation involves creating the new or improving something, goes beyond incremental change. and creates a whole new ball game.
Innovation begets value and competitive advantage, transforms insights into tangible outcomes that become new business intelligence.
Insightful leadership uses that business intelligence to develop more insights, which beget more innovations, creating the BI->I->I continuous loop.
Of Mandates and Business Models
The BI->I->I continuous loop does not just happen. It requires three mandates:
- Leaders must make BI->I->I a corporate priority.
- Leaders must commit to investing in BI->I->I.
- Leaders must be ready to transform these investments into results.
I’m an industrial engineer by education and supply chain thought leader by vocation. Engineers and leaders model things. I can see three models that corporations can follow to make BI->I->I a corporate priority:
- Centralized: A dedicated organizational group focused on BI->I->I
- Decentralized: Each business unit owns BI->I->I.
- A hybrid model: A dedicated centralized group collaborates with business unit innovators.
Best Practices For BI->I->I
In a world where disruption is the new normal, the hybrid model works.
The centralized, top-down approach is a relic of years past. That model can stifle creativity and limit communication. Power remains at the top, and diverse ideas are few.
The decentralized approach often leads to siloed behavior. Silos fail to share their great ideas with other business units, where the ideas can be vetted and honed.
The hybrid model, on the other hand, draws the best from both worlds.
A chief innovation officer can lead the dedicated, centralized group in collaboration with other business unit innovators. This new or repurposed CIO can ensure that innovation strategy aligns with corporate strategy.
Furthermore, the hybrid approach allows for a diverse and inclusive culture that stimulates teamwork across the BI->I->I landscape.
Supply Chain Innovation in the Real World
These kinds of innovations are the focus of our newest monthly newsletter: Tompkins Ventures: The Home Of Innovation. Tompkins Ventures can serve as your dedicated centralized group that collaborates with business unit innovators.
Supply chain innovation comes in many different forms. Our first newsletter included:
- How data analytics can find capacity in tightening markets, reduce overall transportation spend and keep track of shipments at all times. These are all important as supply chain leaders nearshore, friendshore and reshore.
- A supply chain finance app that can transform core activities like sales/purchase orders, logistics shipments and payment transactions into assets that unlock financial liquidity. This app could be the key for companies struggling to deal with days payable cycles that extend for months, sometimes as long as 120-240 days.
- How choosing the right geography for your offshore call center can make all the difference in the world. A nearshore option offers better cultural fit, agents proficient in English and run cost savings between 40%-60%.
I’m excited about Tompkins Ventures: The Home Of Innovation and hope you are too. Sign up here to make sure you don’t miss an issue!
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Jim Tompkins, Chairman of Tompkins Ventures, is an international authority on designing and implementing end-to-end supply chains. Over five decades, he has designed countless industrial facilities and supply chain solutions, enhancing the growth of numerous companies. He previously built Tompkins International from a backyard startup into an international consulting and implementation firm. Jim earned his B.S., M.S. and Ph.D. in Industrial Engineering from Purdue University.
