Date Mining and Data Warehousing for Supply Chain

Management
This article sheds light on how data mining and data warehousing affects Supply Chain
Management which has become a necessity for an enterprise. SCM which plays vital role in
increasing operational efficiency as well as organizing enterprise process, which eventually
helps in providing and infrastructure within societies and in turn provides economic growth.
It has its flaws in various areas and how data mining and data warehousing affects and
control these flaws, we will discuss in this article, but for that we first need to understand
what is data mining and data warehousing.

Data Mining:

Data mining is a process used by companies to turn raw data into useful information. By

using software to look for patterns in large batches of data, businesses can learn more about
their customers to develop more effective marketing strategies, increase sales and decrease
costs. Basically it refines pre-existing raw data and provides useful information that can be
used to improvise strategies.

Data Warehousing:

A data warehousing is defined as a technique for collecting and managing data from varied
sources to provide meaningful business insights. It is a blend of technologies and components
which aids the strategic use of data. It’s an electronic storage of large amount of information
gathered through refinement of raw data with the help of data mining for query and analysis.
It is a process of transforming data into information and making it available to users in a
timely manner to make a difference. The decision support database is separate from
organization’s operation data base though, because it’s more of an environment rather than a
product. It is an architectural construct of an information system which provides users with
current and historical decision support information which is difficult to access or present in
the traditional operational data store.

So how does Date mining and Data warehousing increase the efficiency of SCM?

As important as SCM is to the society where data is everything, it has some significant issues
which hinder SCM’s efficiency these issue include poor inventory management, bullwhip
effect, high cost of logistics, technology usage and inadequate investments in IT. This is
where Data Mining and Data Warehousing come into play.

In an industry where quick turn-around time is the key to gaining higher market
share, it is essential to take the right decisions at the right time. Data mining not
only helps in avoiding the occurrence of ‘bullwhip effect,’ but also facilitates easy
integration of various verticals in the supply chain. Whereas data ware housing
helps in storing data in one place which is easily accessible, provides consistent
information on various cross-functional activities with also supporting ad-hoc reporting and
query, reduce total turnaround time for analysis and reporting, Restructuring and Integration
make it easier for the user to use for reporting and analysis, saves user's time of retrieving
data from multiple sources and stores a large amount of historical data to analyse different
time periods and trends to make forecasting easier.