Future Growth through Data Visualisation A Case Study

Bongani Ngoma and Rynier Keet

1 June 2011

FUTURE GROWTH THROUGH DATA VISUALISATION A CASE STUDY

INTRODUCTION
Ensuring future growth, Today, means that business actions must be based on informed decisions. Informed decisions are only possible having credible information available at the right time. With the rapid-changing business environment, the right time is also Today. Data visualisation is a means to ensure that information users are provided with the right information in a format that enables them to make informed decisions rapidly. It incorporates information visualisation and is a means of exploring and understanding data helping you to make sense of your data - moving from data to insight quickly. It is the basis for self-service business intelligence (BI). According to Stephen Few, a data visualisation specialist, in his book Now You See It, amplifying cognition - Interacting with the visualisations extends our ability to think about information by assisting memory and representing the data in ways that our brains can easily comprehend is the most important characteristic of data visualisation. He clearly states that the purpose of data visualisation is not to make pictures, but to help us think - it is designed to support analytical reasoning. The goal of data visualisation therefore is to answer important questions using data and facts. To demonstrate the power of data visualisation and how it can enhance supply chain visibility, the paper is divided into two parts. The first will be the presentation of an actual implementation at United Pharmaceutical Distributors (UPD). The second part will show some examples of data visualisation reports and dashboards addressing other supply chain information challenges.

UPD - UNITED PHARMACEUTICAL DISTRIBUTORS Background

UPD is South Africas foremost specialist wholesaler of pharmaceutical, medical and healthcare products As such, the company purchases, warehouses and re-sells branded, generic and over-the-counter pharmaceutical products of the highest quality and standards to an active customer base that accounts for almost 80% of the countrys retail and private hospital pharmacy market. The company has two divisions, namely wholesale and distribution divisions to service its different types of customers. Wholesaling is also known as 'fine distribution', which is unlike 'bulk distribution' (that is carried out by UPDs distribution division) in that wholesaling involves the purchase of products from manufacturers by the wholesaler, which thus takes ownership of its inventory. Fine distribution of the product is largely undertaken in single units. Wholesalers clients include independent pharmacies, pharmacy groups, doctors, hospitals, clinics and 24-hour emergency 1

facilities, which require smaller quantities of products to be delivered frequently on a just-in-time basis.

Figure 1: A picture that illustrates the wholesale facility where fine distribution takes place Bulk distribution, on the other hand, is carried out on behalf of third-party clients. In this

instance, the distributor does not purchase the product from the manufacturer , but operates on behalf of and on instruction from its clients, distributing products in bulk and on a less frequent basis primarily to wholesalers, buying groups and large retail chains.

Figure 2: UPD staff at work in the bulk distribution facility The companys extensive experience and expertise in wholesaling in the Southern African pharmaceutical industry ensure that it offers a fast, reliable, predictable and consistent supply of medications and medical supplies for customers in an often unpredictable marketplace. UPD provides two deliveries per day in local areas, and services South African customers within a maximum of 18 hours of order cut-off and customers in Southern African Development Community (SADC) countries within 24 hours of order cut-off. Figure 3: UPD fleet ready for take off

In recent years, the company has continued to successfully adapt to a high-volume, low-margin business model, in light of the countrys single exit pricing environment, by attracting increased sales, including two large private hospital supply agreements in 2005 and 2006. With the opening of more than 200 dispensaries countrywide, sales to Clicks Pharmacies have also increased significantly, demonstrating the benefit of operating an end-to-end distribution supply chain within the group. In addition, independent pharmacy business has been attracted away from the traditional distribution agents, as pharmacies opt for the one stop shop option. UPDs philosophy extends beyond sales: Our focus is not just pharmaceutical transactions, but also customer service and added value. That, after all, is how we set ourselves apart from competitors. To better serve our wholesale customers, we maintain our ability to procure and sell large volumes of front shop products at competitive prices, by keeping abreast of pharmaceutical supply trends and conditions, and by responding continuously. We work closely with suppliers and customers to initiate and grow new markets, and to ensure that we can benefit mutually from new opportunities. Accuracy and reliability of service is fundamental to New UPDs wholesaling success. The companys expert team and highly sophisticated systems ensure that the exacting standards of pharmaceutical supply are met at all times. UPD owns the Link brand which has over the years been the leading pharmacy franchise for independently owned community pharmacies. Through the Link chain of pharmacies, UPD is able to negotiate better deals and better pricing so that this can be passed to the end consumers. Over the years, the Link brand has been recognized as the symbol of quality and as such many families have entrusted their health to the brand. UPD created the Link private label brand (Link Own Brand) to offer affordable high quality alternative products to the Link chain of pharmacies and their end consumers. The other rationale for launching the Link Own brand (LOB) was to give Link pharmacies competitive edge over their independent counterparts. Products that are included in this range are selected according to their market potential. Production is outsourced and distribution is handled by UPD through its network of distribution centres. To assist Link pharmacies, UPD has dedicated staff that service them in areas such as training of pharmacy staff, negotiating value added agreements that enhance their business performance, organising member meetings to share and disseminate information, advise on matters such as leasing of premises and general business administration.

Objectives
UPDs wholesale division is committed to:

retaining its reputation as one of South Africas most dependable and professional suppliers of pharmaceutical products; meeting its customers product needs promptly and efficiently; providing top quality customer service, products and information; and

developing and nurturing worthwhile relationships with suppliers and customers.

UPDs distribution division is committed to:

designing custom distribution solutions that suits our customer needs; providing high levels of customer service using the companys advanced infrastructure; providing value added services to our distribution customers.

Background on UPDs Information Needs

Being a wholesale and distribution company, UPD has vast amounts of data ranging from operations data (i.e., receiving instance data, goods receiving data, packing slips data, belt credits, fall through data, stock on order data, blocked stock data, etc) to buying data (supplier in fill, stock availability, customer in fill, out of stocks, backorders, outstanding orders etc.) to finance data (i.e., sales, margin, claims, clawbacks, rebates, credit notes etc). This data is drawn from an in-house transactional system and sliced and diced by using a traditional data reporting tool. Due to the vastness of data, converting it into meaningful information was difficult and time consuming especially when coming to ad hoc reports that are not covered by the weekly/monthly canned reports. The companys information needs were therefore to gain access to credible information that is available timeously and presented in an easy to understand format. This would be by using a tool that can interface with any transactional or data warehouse system with minimum IT resource involvement self-service BI.

Benefits and Challenges

CHALLENGES BEFORE IMPLEMENTATION
The heavy reliance on IT resources for creating reports, the difficulty in creating ad hoc reports, the lack of advanced drill down functionality in the legacy reporting tool and the lack of graphical information that helps in decision making were the key challenges that were facing UPD. The heavy reliance on IT resources resulted in the IT department spending endless hours creating reports as compared to doing their daily IT activities (i.e., development, executing projects, maintaining infrastructure etc). The fact that users were creating ad hoc reports resulted in delayed business decisions due to users spending lots of time creating reports as compared to analyzing them. This also resulted in incorrect decisions, which were caused by data manipulation from the users due to a lack of a reporting tool that has graphical and drilldown functionality. The other challenges were the time wasted by users in specifying their report requirements to IT.

CHALLENGES AFTER IMPLEMENTATION

Change management as expected was a major challenge to the business as the users were not familiar with the application and the fact that users were heavily reliant on IT for report writing.

BENEFITS
The fact that users can create self-service ad hoc reports with graphs, drilldowns, and colours to highlight certain aspects of data is the major benefit to the business. The easy sorting functionality, drag and drop functionality, filtering functionality, creation of easy to use data hierarchies and the easy interface with the MS office suite especially Excel makes information sharing in the supply chain easy to manage. The ease of implementation driven by the fact that the system is compatible with many data warehouse and transactional systems gives UPD the edge. Another major benefit was the time and cost of implementation. Where a traditional approach to data-visualisation would have been a major cost and time outlay, UPD provided the Executives primary dashboards and reports within six weeks. These reports had full drilldown functionality to the transactional level. This was all achieved through the application of basic data-visualisation practices as part of UPDs self-service approach to Business Intelligence.

Figure 4: An illustration of a UPD Tableau report that presents data in a tabular and graphical format, by using colour to highlight and by the using drill down functionality to zoom in on a specific area of concern.

MEETING OTHER SUPPLY CHAIN CHALLENGES THROUGH DATA VISUALISATION

In this section, we provide some examples of applied data visualisation that can magnify supply chain visibility. Each example sketches a particular scenario with typical questions asked by senior management who want quick insights. Each of these questions will be answered through a

dashboard which, according to Stephen Few, in his book Information Dashboard Design1 is defined as follows: A dashboard is a Visual display of the most important information needed to achieve one or more objectives which fits on a single computer screen so it can be monitored at a glance. The dashboards shown below are developed using Tableau Software, but the principles can be applied to any visualisation software with the required functionality. The logic of each will be discussed as along with some basic data visualisation development principles.

Example 1: Risk Management

This example shows a clothing company that tracks performance and potential hot spots in its operations globally. The company has suppliers in several countries around the world and monitors its risk in terms of how well the plants are operating, as well as the time needed to ship the finished goods to South Africa. The questions they want answered on a continuous basis are:
What is the average ship time to the distribution centre in Johannesburg, South Africa? What is the actual and average uptime of each factory? Are there potential problems areas with regards to products at each factory?

Figure 5: Risk Management Dashboard: Uptime and Ship Time

The dashboard in Figure 5 answers these questions on a single page. The bar graph at the top left clearly shows the ship time and the supplier rating for each factory. This is further supported by the Average Ship time table showing the actual values for each location a clear indication of the risk factor for each factory in terms of shipping time. The heat map to its right shows potential problems, which provides further risk information. The world map with uptime and volumes quickly indicates the companys most important manufacturing centres. To understand performance using

Stephen Few, Information Dashboard Design, Analytical Press, 2006

all three pertinent metricsuptime, ship time and volumea scatter plot with colour and size shows the overall ship time and uptime. The sizes of the shapes give an indication of the volumes produced and shipped. Values showing the average uptime and ship time by location are included at the top of the dashboard.

Example 2: Warehouse Activities Cost per Unit

This company implemented Activity-Based Costing in its warehouse and linked its performance management system to the activities. This not only provided the warehouse manager with costing information but additionally their performance against other metrics. The questions that they wanted answered are as follows:
What is the direct cost per process and activity? What is the indirect cost cost attributed from support activities of each activity? What is the Total Cost Direct plus Indirect of each activity and Process? What is the cost per unit for each unit moving through the warehouse? What is the cost per unit for each activity driver cost per Pallet, cost per Handling Unit (HU), etc.? In terms of cost per unit, how are we performing against plan?

Figure 6: Warehousing Activities - Cost per Unit

The main focus of the dashboard is in two areas: 1) the performance in terms of unit costs for each activity; 2) True or total cost information for the 10 most costly activities. The upper left report shows the actual versus planned performance on unit costs for each activity driver. The bullet graphs show the actual cost depicted by the blue bar and the target unit costs depicted by the vertical black line. The driver descriptions are shown behind the activity description. Within each Pallet, HU, SKU there are units the lowest denomination and the right hand visual shows the unit cost for that. The bottom visual shows the direct, indirect and total/true cost for each activity. The colours indicate which process the activity is linked to.

Example 3: Performance of Service Providers

External service providers such as port services can have a major detrimental influence on total supply chain efficiency. This has a direct influence on a companys cost, delivery time and risk 7

profile. Companies would therefore like to see them operate more efficiently. Shipping companies are also putting more pressure on ports to improve their efficiencies and to reduce their overall operating costs. This obviously has a positive influence on the performance of the port, and also assists in alleviating obvious bottlenecks for all in the supply chain using the port. This example is a dashboard that assists a port to monitor its overall berth productivity. The questions they wanted answered were: Are we achieving our targets? How are we rated on berth productivity? What is the berth productivity by Berth and by Vessel? How productive are the various teams? What are the reasons for missed targets?

Figure 7: Berth Productivity

This dashboard immediately tells the user what the status is with regards to berthing activities in terms of productivity, how many vessels were within the productivity parameters? Below this visualisation is a summary of the ratings achieved and the number of instances. Reasons for not achieving targets are shown in the bottom left corner. By using this value list as a global filter the other three reports will be updated showing the applicable berths, teams and vessels. This example also shows extensive use of bullet graphs. The changes in colours coincide with the parameters shown in the rating visual. From the left they represent <80% of target (red), between 80% and 90% (orange), above 90% (yellow) and exceeding of target (green). They answer the questions in terms of the actual performance against target by berth, vessel and team. Filters are provided to the right that also act as a list report once filtered. All visuals can also be used as filters.

Example 4: The Use of Spatial Information

Supply chains are global and are becoming more so on a daily basis, their data load with regards to geospatial information is therefore also growing at the same rate. The challenge is how to use this data and to link it to other information that will make sense to data users. This example is for a port

authority and is used to link its scheduling system with its tariff system for vessels using the ports that it manages. The questions that they wanted answered are:
What is the origin of the vessels? What is the destination of the vessel? What is the vessel type and description? With regards to our ports what is the tonnage that this vessel has delivered? Provide the full details of each vessel for billing purposes

Figure 8: Linking Data to the World

This integrated Web dashboard, is an excellent example of what can be provided in terms of geographic intelligence combined with other operational data that normally resides on the servers of port authorities, on the Web. Starting at the top left, a quick filter has been incorporated that gives the user the ability to filter by region and vessel type. Report 1 shows a map with the tonnage moved by port of origin and type of vessel. Direct filtering and drill-down functionality is also possible by clicking on the pie chart on the map image, which will automatically filter the other four reports as well, if they apply. Report 2 shows a different style map with tonnage and port of destination, full filtering capability has also been built into this report. When filtering on any pie chart in Report 2, Report 3 will reflect the associated destination detail with regards to vessel name, length and tonnage. Report 4 shows the tracking detail of a vessel over time with cost and tonnage information reported on, whilst Report 5 will provide the full details of the vessel. In addition to the dashboard a mouse-over the vessel will provide a link to any web-based tracking programme to see the current position, photo and other details of a specific vessel. A comment box is also provided giving the recipient of the report the ability to comment or give feedback on performance or the report in general. These same principles can be applied to any freight forwarding or logistics company where transportation is a large part of their business.

Example 5: Improving Stock Management

The following example shows a management dashboard that reports on all the non-value adding reasons for which stock adjustments are being done. It answers the following questions:
Why are stock adjustments done show only non-value reasons? How often do they occur? How many units are affected each time? What are the trends? Is there a difference by weekday?

Figure 9: Stock Adjustments

The left hand side of the dashboard shows three legends identifying departments, type of adjustments and a size legend for unit quantities. On the right side are mostly date filters giving the user the ability to filter down to a specific hour. The top left report shows the number of records by adjustment type as well as the associated unit quantities. The colours indicate the associated departments. The top right report shows the trends by quarter for the number of instances and unit quantities. The line thickness indicates the unit quantities and the colour the number of records as shown by the legend below it. The bottom left report shows the trends by department. The thickness of the lines indicates the number of units affected at the time. The bottom right visual shows the number of records by adjustment type. The line thickness again is an indication of the number of units affected. Here it shows that missing units is the primary reason for adjustments.

Example 6: Performance Management

Managing performance across a supply chain can be very challenging. The following dashboard shows the performance of all warehouses managed by this company. They wanted an integrated system that provides them with the means to, through a single dashboard, access all the performance metrics for all of their warehouses. They wanted to see the following for each warehouse:
The performance by process

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Daily performance and trends over time Performance by metric owner Where were targets exceeded?

Figure 10: Integrated Warehouse Performance Dashboard

As they wanted an integrated dashboard, pre-selection was required. This is achieved through compact list drop-down menus at the top of the dashboard. Legends and filters are placed at the left. The questions are then answered by the four main visuals. The bullet graphs on the left show actual versus target performance by process and by metric owner. Filtering is possible through each of these reports to see the performance for a specific metric or owner. The top right hand report shows the actual versus the target performance by date. It is also possible to add trend lines by right clicking on any point on the graph. The bottom right report shows all the metrics that exceeded target. A legend is attached as the interpretation is affected by the polarity of the metric.

CONCLUSION
What we see and know of, we can address through improved data visualisation design. In the challenging supply chain environment of today, where agility is of the utmost importance, fast access to information and ease of read is required. This will ensure that fast actions can be taken. To be forewarned means that a company can be proactive in its behaviour thereby reducing risk. With the supply chain becoming more instrumented through RFID, scanners and other means, there are more information opportunities available to further enhance total supply chain efficiency. Moreover, it is also true that more and more data is being stored and managers do not really knowing what to do with it. Even with todays business intelligence solutions, companies are still data rich and information poor. Those who have managed to overcome this barrier now have another challenge, how to structure the data so that it makes sense creating meaning out of the 11

data through effective data visualisation. This task should not be given to the IT department since these resources are scarce and they typically do not know the business world. In most cases this also takes time and once managers have the reports they hardly use them as they are not user friendly, or takes too long to make changes to them, or the data is not relevant any more, etc. In most cases IT becomes the bottleneck! Todays decision requirements need to be met with speed, and access to dashboards and visualisations must be quick and easy, requiring minimum IT intervention. Once access has been gained, the structuring and manipulation of the data must be rapid and be done on the fly. Good data visualisation design must therefore accommodate peoples need for depth, flexibility and expressiveness in the visual displays. Furthermore they must also provide the answers quickly and easily without having to involve others to supply the answers required. To conclude, data visualisation cannot work on its own, it has to be supported by the following2:
User-Driven Approach. Analytics and reporting must be decentralized and produced by the people using the results. IT provides the infrastructure, but business users create their reports and dashboards. Flexible Configurations. Companies need answers for todays challenges but without sacrificing tomorrows needs. The chosen software needs to be configurable and priced to support that. Also in the supply chain environment there will be more than one type of system used which means that the software must be able to link to more than one type of database without IT having to be involved. High Performance. The solution needs to run fast. It must have multiple means of getting that performance. Different departments and organizations have different needs and all of their requirements need to be catered for. Easy Administration. IT needs to be able to support the new application with existing staff and infrastructure. New world BI makes the life of an IT executive and manager easier. IT should not be involved in creating and running reports but spending time on providing highvalue services to the organization.

Data visualisation supported by at least the four factors mentioned above can change the way that supply chain companies do business. Through the use of data visualisation, supply chain visibility will become the primary enabler and solution to supply chain challenges, as more visibility will enable companies to address all of the other challenges proactively as data or information visualisation forms a major part of the solution it provides insight and if started Today will lead to future growth rapidly!

Dr. Chris Stolte, Dan Jewett and Professor Pat Hanrahan, A New Approach to Business Intelligence: Rapid-fire BI, August 1, 2009

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