Data Analytics for International Business

BMG880

Report of Business Intelligence (BI) support for inventory

information management of AUDI

Word count: 2844 (excluding cover page, table of contents, reference)

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Table of Contents

1.Introduction...........................................................................................................................2

2. Theoretical Framework.......................................................................................................3

2.1 Business Analytics in Automotive Industry (Inventory Management).........................5

3. Data Analyses.......................................................................................................................6

3.1 Dashboard.......................................................................................................................7

4. Dashboard Justification.......................................................................................................8

5. Recommendation................................................................................................................12

6. Conclusion...........................................................................................................................13

7. Reference.............................................................................................................................14

List of Figure
Figure 1 Framework of BA........................................................................................................4
Figure 2 Data Information..........................................................................................................7
Figure 3Audi Used Car Inventory Dashboard...........................................................................7
Figure 4 Audi Dashboard Slicer.................................................................................................8
Figure 5 Audi Quantity by Model Type.....................................................................................9
Figure 6 Audi Quantity by Transmission.................................................................................10
Figure 7 Audi Quantity by Colour...........................................................................................10
Figure 8 Audi Quantity by Engine Size...................................................................................10
Figure 9 Audi Quantity by Price (£) Range.............................................................................11
Figure 10 Audi Quantity by Milage Range..............................................................................11
Figure 11 Audi Quantity by Fuel Type in %...........................................................................12

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1.Introduction
Inventory management is a key success element for many businesses, and how well a firm
manages its inventory determines its future. Much of a company’s costs can be attributed to
the amount it invests in inventory (Waller & Nachtmann, 2006). Companies are looking for
ways to cut costs by improving the efficiency of their inventory management systems.
Logistics information systems are one method that businesses try to cut expenses. According
to (Chopra and Meindl, 2001), Information is vital to a company's supply chain performance
because it allows management to make broad decisions involving several functions and
organisations (Waller & Nachtmann, 2006).The use of Business Intelligence (BI) providing
right information to right people at the right time. Business intelligence, according to the
Gartner Group, BI is an umbrella phrase that includes applications, infrastructure, tools, and
best practises that enable access to and analysis of data to enhance and improve decisions and
performance (Nedelcu, 2013).

Audi, a world-renowned vehicle manufacturer with a 7.2 percent market share in the United
Kingdom (Statista, 2020), is currently experiencing inventory management problems at its
warehouse as well as poor supply chain coordination with its dealer for used cars in the
United Kingdom, both of which are pushing up the company's costs. As a result, it impacts on
company profit and reducing demand of the Audi car. Audi want to reduce manufacturing
costs by managing inventory while also want to increase flexibility and communication for
instance- good co-ordination with their dealer, which will be led to increase profit. Audi want
to implement BI in order to get right information to right person at the right time to improved
communication with dealer and analysis of data to enhance and improve decisions and
performance of the company.

This report will discuss how business intelligence (BI) can improve inventory information
management process, which will assist in Audi management's cost-cutting efforts and
inventory management. This report also will discuss about how BI can improve Audi
company co-ordination with their dealer about inventory information which will help
company management to analyse product promotion and sell. BI analyses the Audi over
10000 used vehicle inventory data in a excel sheet at the start of the data analytics/BI process,
then finds the KPI BI visualize those data on a performance-based dashboard which will help
to understand company data easily.

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2. Theoretical Framework
In the 21st century time, organization’s success depends on their ability to manage the flow of
materials, information, and money into, within, and out of the organization. Such a flow is
referred to as a supply chain. There are various issues and obstacles in auto industry supply
chains since they are generally distributed and can be highly complicated, involving many
different businesses issues can result in excessive inventory costs, supply and demand
mismatches, poor customer satisfaction, lost revenues, and decreased flexibility (Stefanovic,
2015).

A good supply chain system allows a business to get the right things to the right place, at the
right time, and in the right condition. Effective Inventory Management as a part of supply
chain, on the other hand, allows a company to lower its costs (Mankazana, et al., 2018).
Effective use of information and quantifying the value of information are important aspects
of effective inventory management system that contribute to good coordination in and outside
of the organisation (Ozer, 2011). Business Analytics (BA) in Auto inventory information
management will enable a manufacturing company to reduce costs, improve coordination
with suppliers and distributors, forecast future production, and assist in the resolution of
problems, all of which will increase the company's value and profit (Choi, et al., 2018).
Therefore, Audi need investment into Business Analytics (BA) in order to able efficient
inventory management and sharing information with dealer.

Business Analytics (BA) refers to software solutions that help users evaluate large amounts
of data in order to make better business choices. It is a set of skills, technology, tools, and
procedures used to conduct ongoing, repetitive investigations into previous company
performance in order to obtain a better knowledge of and drive business planning (Khan, et
al., 2019). According to Davenport and Harris (2007), BA systems add value to businesses by
enhancing business processes, decision-making, and organisational performance, as well as
providing a competitive advantage (Shanks & Bekmamedova, 2012).Moreover, Watson
(2010) state that, data warehousing, reporting, visualisation, online analytical processing
(OLAP), forecasting, predictive modelling, and statistical analysis are examples of BA
technologies (Cosic, et al., 2015).

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Where, Dashboards allow operational experts and supervisors to keep track of occurrences
and take action (Eckerson, 2010). Dashboards use charts or tables to visually represent
performance. Operational dashboards are used to monitor operational activities management
and ensure that processes stay within defined productivity, quality, and efficiency parameters
(Eckerson, 2010)

The theoretical framework takes an evolutionary process theory approach and use continuous
evolution to describe how BA systems generate value (Shanks, et al., 2011). According to
Khan, Nadeem, Ali (2019), BA general framework have Data layer, Analytics layer,
Reporting/ Visualization layer (Khan, et al., 2019).

Figure 1 Framework of BA (Khan, et al., 2019)

Data Layer
Data can be found in numerous areas and in many forms, which must be collected in one
location where Data is gathered from both internal and external sources (Khan, et al.,
2019).The collected data is stored in data warehouse and then analysed for decision making.
Data must be converted before it can be loaded into a data warehouse from both internal and
external sources. This conversion process has three steps (Khan, et al., 2019)
Extract -
Data is gathered from a variety of sources, including both internal and external sources. The
data is then combined, and irrelevant information is removed.

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Transformation-
To repair missing, inconsistent, or erroneous values, the extracted data is checked and
cleaned up. The data is converted to a standard format, and business rules are used to map the
data to the warehouse schema.
Load-
Cleansed data is then loaded into the data warehouse.
Analytics Layer
Descriptive/Predictive/Prescriptive analytics are used to analyse data from the Data
Warehouse. Data mining or Multidimensional Data Analysis tactics applied in Analytics
layer. Data mining is the practise of exploring and analysing large amounts of data using
semi-automated or autonomous methods in order to find relevant patterns and rules. Where,
multidimensional analysis allows users to see the same data in a variety of ways by
combining different dimensions. Each dimension is represented by a separate piece of data,
such as geography, product, cost, price, or time period (Khan, et al., 2019).
Reporting /Visual layer
Dashboards are visual representations of critical business data in the form of graphic
indicators, charts, and tables.  A digital dashboard is a graphical high-level view of business
processes that may be delved down into for more information on a specific business process
(Khan, et al., 2019).

2.1 Business Analytics in Automotive Industry (Inventory Management)

Business Analytics(BI) assist in information sharing may bring a significant amount of

advantages to auto manufacturing sector such as efficient inventory management, cost
reduction, increasing visibility (significant reduction of uncertainties), improved
resource utilization , increased productivity, organizational efficiency improved
services, quick response , reduced cycle time from order to delivery, , and optimized
capacity utilization (Lotfi, et al., 2013). Automobile manufacturers are now capable of
gathering and analysing massive amounts of inventory raw data by using BI. Business
analytics advancements and its integration with the automobile sector have resulted in
smarter, more connected vehicles as well as significant advances in sharing inventory
information and cost management. Automobile manufacturers can apply business analytics
tools to gain new insight into their business and make better decisions, allowing them to
maintain and improve their market position and revenues. BI has been utilizing in various

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area of the automobile industry, while some companies have been applying analytics for
longer than others, the development of modern technology has significantly accelerated the
way data is acquired and used (sas, 2021).

3. Data Analyses
The process of collecting, modelling, and analysing data in order to derive insights that
improve decision-making is known as data analysis. According to McFedries (2018), Data
analysis is the use of tools and procedures to organise, examine, draw conclusions, and, in
certain cases, make predictions about a particular set of data (McFedries, 2018).

Thus, Audi has a problem sharing used car inventory information with dealers and inventory
management. It is necessary to obtain all inventory Audi used car data. Data on Audi used
cars gathered via Kaggle. Following the collection of data, it is necessary to analyse how
many different types of cars are available in each category, as well as their individual details.
It will help Audi manager to improved communication with their dealer. So that dealers may
get daily updates on individual quantity, which will help dealer in determining which types of
cars they need to focus on promoting in order to sell. As a result, sales will be rise.
Furthermore, by analysing used car inventory data, Audi manager can decide whether to
increase or decrease new car manufacturing. Because an analysis of specific used vehicle
inventories in warehouses allows managers to identify which cars are in stock and how many
of them there are, managers will be able to better understand individual types of car demand
for production. As a result, it will assist in cost reduction through efficient production
management.

Data Collection
Data collection allows firms to save and evaluate critical information about various
workflows in order to improve decision-making processes (Christiansen, 2020). Data is
collected from various sources (external and internal) and store it data warehouse (Ernst &
Santos, 2021). Thus, Audi can use their own inventory data set to improve their decision.
Data is collected over 10000 used cars warehouse inventory in UK from Kaggle and their
individual detail which will give a good picture of current situation. Individual used car data
is collected on the basis of (figure 2).

Figure 2 Data Information

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 transmissio fuel engine
model price n mileage Type Size colour
Source-Own editing
By analysing individual used car data on the basis of (figure 2) element in excel, Business
Intelligence not only provide individual car information to dealers for promotion, but also
help managers make better decisions about new car manufacturing based on demand.

Product Categorised

Car SUV Sports Car

Categorise all different type of Audi model in three colours to analyse data. Where orange
represent car (A1, A2, A3, A4, A5, A6, A7, A8) model, Green represent SUV (Q2, Q3, Q5,
Q7, Q8) model and yellow represent Sports car (R8, RS3, RS4, RS5, RS6, RS7, S3, S4, S8)
model.

3.1 Dashboard
Figure 3 Audi Used Car Inventory Dashboard

Source-Own Editing

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4. Dashboard Justification

Overall, this dashboard will give daily information about the amount of used car inventory in
the Audi warehouse in many categories (model, transmission, fuel type, colour, pricing range,
Engine size, and millage range), which will be displayed in pie and bar charts and tables.
Audi managers can gain in-depth knowledge of their particular vehicle quantity by using this
dashboard, which will assist them in forecasting future production of that specific car. For
example, if the quantity of used vehicle Automate transmission above 2.0 engine size in black
colour A8 Audi model soon runs out, it will be reflected in this dashboard, which will assist
managers in making future manufacturing decisions for this specific A8 Audi model. As a
result, it will reduce cost by predicting future demand for a specific product and then
producing that product. Furthermore, by implementing this dashboard, Audi can send
accurate information about their used car stock to their dealer every day which improving
communication efficiency for increasing sell.

Figure 4 Audi Dashboard Slicer

Source- Own Editing

Slicers enable dashboards to have a visually appealing and engaging user experience
(Alexander, 2021). Slicers allow you to filter different charts and graphs on dashboard which
will help to get specific information easily. According to (figure 4), dashboard slicer is
categorised in four types (Model types, model, transmission, price range). By using this slicer
on dashboard Audi manager can get easily information about their specific car for instance-
by clecking SUV on model type manager can get all types of information (model,
transmission, fuel type, colour, price range, Engine size and millage range) of SUV which
will help them their decision making.

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 Figure 5 Audi Quantity by Model Type

Source- Own Editing

Bar graph in (figure 5) will provide information about the quantity of used Audi model type
(SUV, Car, Sports Car) stock in warehouse. If the inventory decreases or increases, it will be
reflected in this bar graph by changing, for example, if the SUV stock increases, it will be
reflected in this bar graph in comparison to other model types, which will help manager to get
overall overview of all stock information to take better decision.

Figure 6 Audi Quantity by Transmission

Source- Own Editing

Bar graph in (figure 6) will provide information on transmission category (Automatic,

Manual, Semi-Auto) of each model of Audi quantity for instance -this graph provides stock
information of 972 Automatic ,1160 Manual and 1450 Semi-Auto of SUV model. If the
inventory level up and down by different transmission wise it will reflect in here which will
help manager to take to get dipper inventory knowledge in transmission category.

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 Figure 7 Audi Quantity by Colour

Source- Own Editing

Figure 7 shows a bar graph and table that show the colour category (white, red, grey, black)
of each model quantity. For example, this graph shows stock information for 1133 white, 789
red, 459 grey, and 1201 black Audi SUVs. If the stock level up and down it will reflect in
here. As a result, manager can know which type of colour is more demand by monitoring the
information from here.
Figure 8 Audi Quantity by Engine Size

Source- Own Editing

Doughnut chat in (figure 8) provide percentage information of different engine size vehicle
stock in warehouse. Engine size is categorized in three layers (under 2.0 litre,2.0-3.0 litre,
over 3.0 litre). By using this chat manager can understand which types of engine size item
they have more or less. Manager can get overview of stock information by engine size.

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 Figure 9 Audi Quantity by Price (£) Range

Source- Own Editing

Bar graph in (figure 9) will provide information on price ranges of each model quantity of
Audi. Price ranges is categorized in four layers (under £15000, £15000-£30000, £30000-
£45000, Over £45000). This graph will help managers in providing information about their
inventory price range to their dealer. For example, manager can share information about
SUVs (under £15000) 209 quantity and (£15000-£30000) 2178 quantity easily with their
dealer request easily by using this graph.
Figure 10 Audi Quantity by Milage Range

Source- Own Editing

According to Table in (figure 10), will provide information on milage ranges of each model
quantity of Audi. Milage ranges is categorized in five layers (under 25000, 25000-50000,
50000-75000,75000-10000, Over 100000). This graph will assist managers in exchanging
information about their stock with their dealer based on mileage range. Which will assist
dealers in gaining day-to-day detail knowledge of Audi stock that can help increase sell. For
instance -by using graph manager can share information of SUV have (under 25000 milage)
2514, (25000-50000) 795 quantity.

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 Figure 11 Audi Quantity by Fuel Type in %

Source- Own Editing

Pie chart in (figure 11) will provide information about the percentage of used Audi in fuel
type (Diesel, Hybrid, petrol) stock in warehouse. If the inventory getting less or more it will
reflect in here by changing percentages for instance- if the Diesel vehicle stock increase it
will change the percentages in this chart compare with Hybrid and petrol, which will help
manager to get overall overview of all stock information by fuel type.

5. Recommendation

Business Intelligence (BI) provide company right information to right people at the right
time. According to (Chopra and Meindl, 2001), Information is vital to a company's supply
chain performance because it allows management to make broad decisions involving several
functions and organisations (Waller & Nachtmann, 2006).Therefor, Audi as car
manufacturing can implement BI not only used car inventory information management
process but in future they can implement of new car inventory information management
process also ,which will help management to take better decisions for company.

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6. Conclusion

Audi one of the leading car manufacturing company in the world who hold 7.2% market
share in UK (Statista, 2020).Audi have different types of vehicle like SUV, Car, Sports Car.
By using Business Intelligence (BI) in inventory information sharing process Audi may bring
a significant amount of advantages such as inventory reduction and efficient inventory
management, cost reduction, increasing visibility (significant reduction of uncertainties),
improved resource utilisation , increased productivity, organizational efficiency improved
services, quick response, reduced cycle time from order to delivery, and optimized capacity
utilization (Lotfi, et al., 2013). Furthermore, BI dashboard will provide daily information
about the amount of used car stock, allowing Audi managers to gain in-depth knowledge
about their specific car quantity, allowing them to predict future production of specific cars
and provide exact information about their used car stock to their dealer every day, improving
communication efficiency.

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