Why accurate product data is crucial for effective supply chain management

The objective of any supply chain management system is to effectively and efficiently manage the procurement of materials and services to satisfy the demands of one or more site situations.

From stock control to scheduling and vendor selection, through to shipping, goods inwards and storage, supply chain management touches all relevant disciplines. Its communications and interactions with other departments including accounts, production control, purchasing and sales must be fast, sure and slick, to meet the supply chain challenges that awaits.

The challenges that supply chain management systems face

There are any number of problems that can interfere and disrupt a supply chain such as: 

• Single sourcing
• Global regulatory issues
• Technology related issues
• Controlling costs
• Logistics
• Appropriate storage and warehousing
• Accurate product data.

It is this last category (accurate product data) that is fundamental when it comes down to effective supply chain management. Without it, the supply chain operation is little more than guesswork.

The importance of accurate product data

Good quality product data will tell supply chain managers all they need to know about a product, to ensure that supplies are procured on time and within budget while maintaining a lean approach to inventory management. Getting the basis of product data correct and as accurate as possible is the starting point.

It’s all about the detail such as the description of the product, its universal part or product code, high-resolution imagery of the product, a list of parts and accurate and up-to-date specifications. This forms the very foundation of any supply chain activity. Get this wrong, and it doesn’t matter how low cost the materials or products were purchased, or the fact that the goods turned up on time and in the right place. If the goods are not fit-for-purpose, it is a wasted exercise.

Of course, accurate product data is not the be-all and end-all. It’s a good start, but there are other influencing factors that impact on effective supply chain management too.

Other elements of business data that are necessary

Accurate sales forecasts and production scheduling is also key. However, just as important as these two elements is fast regular updates of any changes in demand, either real or forecast. Without this, stocks can dwindle to zero; long waits can be experienced while stocks are replenished; or on the other hand, inventory can get too high, which can damage cash flow.

When product data is accurate in all respects, it benefits supply chain management in many ways, including:

• Optimising logistics
• Ensuring the correct storage conditions are met
• Conforming with global regulatory conditions
• Enhancing inter-departmental integration

ERP solutions will touch on this very aspect of the supply chain and are based on all the relevant peripheral activity around it. Choosing the right ERP software to power and manage your supply chain system will produce the best outcome possible. It will ensure that products are always there when wanted and that costs are minimised.