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How a PIM Compliments Your Supply Chain Management Strategy
Author name: Anton Koroid
With the increasing complexity of global markets and customer demands, companies must continually innovate and adapt their supply chain strategies. One valuable tool that complements and enhances these strategies is Product Information Management (PIM). It has a vital role in enhancing supply chain efficiency. In the following editorial, we will explore how PIM can significantly contribute to a more efficient and effective supply chain management strategy.
PIM Role in eCommerce
It is difficult to overestimate the importance of the eCcommerce market in the last five years. At the same time, analysts note the growing significance of PIM (Product Information Management) for eCommerce. According to the estimates of The Group of Analysts (TGOA), by 2030, the global PIM market will reach a volume of $63.8 bn with average annual growth rates of 21.09%. The adoption of PIM by small and medium-sized companies is largely facilitated by the reduction of barriers when using SaaS-based solutions.
PIM can be defined as a system or process centralizing and managing all product-related information within a business structure. It includes product descriptions, specifications, pricing, images, and any other product attributes or data necessary for marketing, sales, and distribution. PIM systems are designed to ensure data accuracy, consistency, and accessibility, making them an indispensable asset in modern business operations especially when working with multiple sales chanels including eCommerce.
According to a report by Research & Markets, the PIM market is growing in response to the increasing need to centralize product information across various sales channels, improve customer service quality, and reduce the time for new products to get to market. The retail sector, with a 40% market share, remains the largest consumer of PIM. This is primarily due to the growing trend of omni-channel retailing, where companies need to manage product information across multiple sales channels, including online markets, social media, and physical stores.
The Essence of Supply Chain Management Strategy
It's quite hard to operate a company without a supply chain strategy. Its presence enables effective navigation of evolving markets and meeting customer expectations. It is a comprehensive plan for the planning, designing, execution, monitoring, and control of the supply chain activities.
A well-executed supply chain strategy aims to minimize costs, reduce lead times, improve quality, and enhance customer satisfaction. To achieve these objectives, companies need accurate, up-to-date, and accessible product information throughout the supply chain. The supply chain strategy also documents which function is responsible for:
- each supply chain action,
- timelines for necessary collaboration,
- actions and their timelines,
- performance measurement.
The strategy must align closely with business objectives, integrate various supply chain activities, and contribute to the supply chain development. A good starting point for such a strategy could be the Supply chain operations reference (SCOR) model. Effective supply chain strategies employ a high-level, top-down approach to define the business direction rather than delving into minute details.
PIM in Supply Chain Management Strategy
The time we live in traditional management methods, including manual record-keeping, spreadsheets, disparate CRM, ERP, SCM platforms, and so on, can no longer bridge the communication gap across various stages of the purchase process. Specifically, even minor changes to product data made at early production stages can lead to significant confusion in later logistics and marketing stages, potentially even misleading the customer.
An effective PIM solution allows for timely access and updates to the necessary information. Such a system provides a centralized, consolidated ‘single source of truth,' enabling company employees and customers to access and edit data, all while staying on the same page. The likelihood of errors is minimized thanks to this enhanced transparency and uniform data flow throughout the entire chain.
PIM has a pivotal role in ensuring that everyone involved in the supply chain has access to the most accurate and up-to-date product information. This accessibility promotes transparency and collaboration among suppliers, manufacturers, distributors, and retailers. With real-time access to product data, stakeholders can make informed decisions and respond quickly to changes in demand or market conditions. Inefficient supply chains often result in increased delivery costs. PIM assists in streamlining the supply chain by maintaining accurate product data and ensuring that the right products are in the right place at the right time. It reduces the need for rush deliveries, excess inventory, and costly supply chain disruptions, ultimately leading to substantial cost savings.
Data accuracy is critical in supply chain operations. PIM systems help maintain data consistency and integrity throughout the supply chain, reducing errors and inaccuracies. In turn, it minimizes costly mistakes such as shipping the wrong products, incorrect invoicing, and order fulfillment errors. Using PIM as a single source of truth for product data, allows supply chain managers to make more informed decisions. Whether it's selecting suppliers, optimizing inventory levels, or responding to changing customer preferences, having reliable data at their fingertips empowers decision-makers to navigate the complexities of supply chain management with confidence.
Improving Supply Chain Efficiency Using PIM
PIM can yield maximum benefits only when fully integrated into the business. This requires the development of auxiliary data models, segregation methods, and specific PIM management approaches. The development of a PIM strategy in the supply chain may follow the following sequence:
Collecting product data based on customer needs. Discuss how PIM systems allow companies to gather and organize product data according to customer demands and preferences. This data-driven approach enables businesses to tailor their supply chain operations to meet specific customer requirements more effectively.
Ensuring accurate product data to optimize logistics. Explain how PIM systems contribute to the optimization of logistics by maintaining accurate and consistent product information. Highlight the importance of data accuracy in minimizing shipping errors, reducing lead times, and streamlining supply chain operations.
Applying grading standards to reduce costs. describe how PIM solutions can implement grading standards for products. Discuss how this helps in categorizing and pricing products appropriately, leading to cost reductions and improved efficiency in supply chain management.
Gaining a 360-degree view of product data in compliance with global regulatory environments. Explore how PIM systems provide a comprehensive view of product data while ensuring compliance with global regulatory requirements. Discuss how this feature helps companies navigate complex international markets and maintain legal and regulatory compliance.
Consolidating product data to support decision-making. Highlight the role of PIM in centralizing and consolidating product data from various sources. Explain how having a unified source of product information facilitates data-driven decision-making processes, leading to more informed and strategic choices within the supply chain.
Output
A well-implemented PIM system is a valuable asset that can significantly enhance the efficiency and effectiveness of your supply chain management strategy. By providing easy access to accurate product information, reducing delivery costs, optimizing logistics, and enabling better decision-making, PIM helps organizations stay competitive in today's dynamic business environment.
Embracing PIM as an integral part of your supply chain strategy can lead to cost savings, improved customer satisfaction, and a stronger position in the market. It's clear that PIM is not just a tool; it's a strategic advantage for modern businesses striving for supply chain excellence.
Modified on: 10/09/2023