Value of Information (VOI) quantifies the benefit gained by having access to additional data or improved data quality in decision-making processes. In supply chain management, VOI helps determine whether investing in better forecasting tools, real-time tracking, or market intelligence is justified by improved inventory outcomes. Higher VOI allows for more accurate demand predictions, reduced safety stock, and lower inventory carrying costs. It supports more agile and informed replenishment decisions, mitigating risks such as stockouts or obsolescence. Inventory optimization platforms leverage VOI by integrating diverse data sources and applying analytics to extract actionable insights. Understanding VOI guides investments in digital supply chain capabilities and data infrastructure to maximize return on investment.
