How Lytica became a unique analytics company: Part 6

Part 6: Informed Advantage

In 1956, Robert Solow and Trevor Swan came up with a model that demonstrates how, if technology levels and innovation don’t increase, the economy will cease to grow and will remain in a steady state under constant capital stock. I agree that our economies are growing because our technology arsenal and innovation scale are growing.

Technology and innovation underpin productivity when they are applied to how we get things done. Considering that technology and innovation accelerations are happening continuously, if you are slow to adopt new approaches, then stresses that would put the San Andreas Fault to shame are building in your business processes!

I have written about this acceleration in previous blogs, such as “The acceleration of everything.”  In them, I describe the impact acceleration has on the interval in which one has to respond to competitive actions.  Action intervals are collapsing fast, and working harder isn’t enough to keep up. How we get things done must dramatically change; tweaks just won’t cut it anymore.

The ability to do more in a given amount of time, with the same resources, is called productivity. As everything is accelerating, achieving the same old levels of productivity improvement does nothing but position you further and further behind. Single-digit percentage productivity gains are worse than standing still, because when standing still you at least have the “Deer in the Headlights” excuse to explain your failure.

In business, bankruptcy is the ultimate failure state. Bankruptcy prediction models, such as the Altman’s z-score and others, place operating earnings as a key parameter. Success, therefore, needs healthy growth in margins. They grow by either increasing revenue or driving down competitive costs. Keeping business supply chains responsive and cost competitive are crucial to long term growth and survival. Significant methods change is needed to achieve this in your business processes and cost management.

Amazon’s acquisition of Whole Foods is interesting because it will likely cause seismic change in the food industry. Expect disruption and hardship for the unprepared, who are probably most of the established grocery chains, caused by Amazon’s advanced business methods. Many distribution companies in the electronics supply chain already fear and feel the disruptive impact from Amazon.

Seismic level change only comes by changing the system. Systemic change gets around constraints that limit performance, remove nonvalue added process steps or deliver solutions that are not possible by pushing current processes harder. My company needed systemic change in the way it developed the underlying technology used in its products and adopted an approach based on Artificial Intelligence (AI). If your company is typical, you need this level of change as well — and fast!

The key to productivity gain in an accelerating world is taking time out of the process — giving less and receiving more. Getting answers to questions immediately is a huge improvement over expending weeks on data preparation, analysis and strategy reckoning. Being informed of the answer without having to follow a long process is a huge advantage.

The development of AI enabled capabilities like this is game-changing; intelligent personal assistants, in the form of Siri and Alexa (amongst others), do amazing things. Speech recognition aside, these applications pull information from various sources and, within a narrow range, answer posed questions quickly and accurately. Google Maps, and others applications, plan best routes as well as highlight traffic jams and predict delays in real time. Data from many sources are analyzed and reported immediately. Contrast this with many of my clients’ experiences preparing an upload file for Often it takes days or weeks to pull information together from separate systems and still it is incomplete and plagued with quality issues such MPN spelling errors.

Think how Alexa-like performance in getting answers would simplify life. Better, think of how much more competitive and productive your competitors are if they have Alexa-like access to answers while you remain stuck with systems that don’t interact and have data plagued with errors. You would be stuck in a Dewey Decimal System world of answer access to their Alexa-like immediacy. They just ask a question and get a correct answer, while you do the equivalent of taking a trip to the library, searching for books, scanning for information and assembling an answer.

Lytica’s has already enabled progress along the productivity journey by providing pricing answers. Now we want to simplify and enhance the process. In doing so, we are creating a number of technology building blocks and data sources that can be made into standard products and tailored solutions for the supply chain.

Reflect on this blog’s message and consider how our technology could make you more productive. How would you change if you had superior answer access? Perhaps participation in our Advanced Technology Center (ATC) is a first step in your productivity journey. Let me know how I can help.

In part B, I will report on some of the work being undertaken in the ATC now, and results achieved in creating the building blocks for product and productivity enhancement.

Ken Bradley is the Chairman/CTO & founder of Lytica Inc., a provider of supply chain analytics tools and Silecta Inc., a SCM Operations consultancy.


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