Supply chain visibility is the lifeblood of any modern business looking to transform its inbound logistics. Your entire supply chain thrives on the ability to track individual items, final products and sub-assemblies by providing real-time updates. That’s why many businesses use supply chain management software to deliver the latest data and logistics insights.
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Article Contents:
Overview
Despite being a significant component of supply chain management, most organizations lack end-to-end visibility. This oversight can cause multiple supply chain disruptions like increased inefficiencies and cost of working capital, changing customer expectations, loss of productivity, etc.
As supply chains become more complex, organizations need agility and technological advancements to improve overall performance.
Supply chain visibility extends beyond operational and logistics activities. It provides transparency into all aspects of the supply chain.
- Suppliers: Provides real-time order backlog information to strategize inventory management processes.
- Manufacturers: Facilitates production planning using real-time updates on raw materials sourcing, procurement, manufacturing inefficiencies and production volumes.
- End Consumers: Keeps you updated on dispatch and delivery status.
- Logistics Vendors: Stay informed about delivery status, cargo availability, consignments, etc.
With supply chain disruptions at peak levels, organizations need to prioritize visibility and agility to stay resilient. In this article, we’ll discuss the significance of supply chain visibility, why it’s important and the tools you’ll need to strengthen your supply chain.
Significance
Lack of end-to-end transparency is a critical flaw, and most organizations categorize it as a C-level issue for supply chains. Without it, day-to-day operations can go berserk, leaving organizations clueless, resulting in more disruptions and higher risks.
From tracking physical product location to order information, manufacture date etc., supply chain visibility helps solve some of the most crucial issues. It gives you a bird’s eye view of operations in and around your supply chain. It also improves delivery timelines, increases competitive advantages, enhances regulatory compliance and more.
However, adjusting quickly to unexpected disruptions isn’t something supply chains typically succeed at. In 2021, Quickbase and a third party surveyed over 200 supply chain executives across the U.S. to find out how to solve these challenges. The survey highlights that nearly 37% of executives were confident handling upcoming changes, while 63% felt moderately or entirely unprepared.
More so, inaccessibility to daily insights and manual processes can cause supply chain challenges. This negative is why achieving supply chain visibility via data transparency is crucial to mitigate future disruptions and prevent uncertain risks.
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Types
Supply chain visibility may vary from industry to industry or company to company. Below are the types of supply chain visibility your company can consider while looking for insights.
Rates
Visibility into the costs related to transportation gives a clear picture of how much money you’re spending on moving, shipping and delivering freight. It helps monitor fulfillment locations, available carriers and shipment numbers. Such information allows supply chain executives to track how much the company spends and conduct a cost-benefit analysis.
Cargo Location
Cargo and shipment locations allow organizations to schedule and deliver as needed. Visibility into shipment locations keeps internal and external stakeholders informed about the whereabouts and status of their goods.
Supply Chain Activities
Internal and external end-to-end processes allow the organization to track manufacturing partners, sales and purchase orders, inventory levels across suppliers, etc. Visibility around supply chain activities helps track and trace issues.
Auditing Records
Information on past transaction records and freight activities helps review, audit and validate past orders. It provides seamless auditing and maintains regulatory compliance.
Primary Benefits
Supply chain visibility offers many benefits to improve overall workflows and increase profits. Let’s look at some below:
Improve Productivity
You need to analyze costs in areas like inventory, staff time, disruptions, risks and transportation spend when looking for ways to improve productivity. Maximizing labor efficiency is one of the most important cost centers in the supply chain. With real-time supply chain visibility, you can reduce idle time while maximizing productivity through automation.
Mitigate Risks
Upcoming disruptions and uncertainty in your supply chain directly impact your revenue. End-to-end visibility into multiple data sources lets you identify potential threats, determine different scenarios and develop strategies to mitigate risks (if needed). It keeps you wary of economic, environmental, ethical and political risks.
Enhance Visibility
Optimizes traditional inventory planning by managing gross margins, sell-through rate, stock turn, product performance and lost sales via supply chain visibility software like Project44, E2open, Shipwire, etc. It also minimizes costs and risks relevant to these concepts.
Boost Customer Experience
Improves customer-facing team productivity and encourages collaboration across different departments. Leverages real-time data to enhance delivery visibility and communicate with customers. Such data keeps internal teams and customers aligned with their shipment statuses.
Facilitate Agility
Thanks to the pandemic, agility plays a significant role in supply chain management. Organizations need the best systems to analyze and sift through large volumes of data. They have to find the best course of action to predict and develop risk mitigation strategies. With real-time supply chain visibility, organizations can track outbound shipments and locations while managing dock schedules with better accuracy.
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Tools
Supply chain visibility is possible if you have the right tools. These tools address issues in real time, from streamlining different areas in your supply chain to reducing costs. Here’s a quick look at six tools that boost visibility.
Radio Frequency Identification (RFID)
Most organizations use RFID tags as one of their supply chain visibility tools. These tags identify and count items as they’re processed. They track items during packaging, unloading or transit to capture accurate information. Benefits of RFIDs include improved asset tracking, inventory management, traceability and production control.
According to Vantage Market Research, the Global RFID tag market will grow at a CAGR of 9.7% between 2021 and 2028.
Networks
Networks such as local connections between wireless carrier networks and IoT devices stream data when moving goods from one application to another storage system. These networks are powerful compared to broadband networks. It makes them the best solution to connect IoT devices to millions of other devices without consuming too much power.
Such networks are ideal for industry 4.0 applications, supply chains, logistics, industrial IoT, smart cities, etc.
IoT
The internet of things is another important supply chain tool. IoT and basic computing capabilities provide organizations with real-time location status and orders to increase fleet efficiency, reduce transportation costs and boost customer satisfaction.
Analytics
Analytics systems allow you to connect with multiple different sets of data for in-depth analysis. They discover upcoming trends and insights for supply chain executives to make route changes and avoid problems.
Data Storage
Cost-effective and highly scalable, data storage allows supply chain managers to gather data from test projects at a lower cost without investing in hardware. However, as the project grows, companies can modify their storage requirements as and when needed.
Artificial Intelligence (AI)
Over the years, AI proved itself as a valuable supply chain tool. The technology’s ability to transform this industry is promising. It helps companies analyze huge volumes of data, enables end-to-end transparency, makes quick decisions and provides visibility into operations.
It delivers proactive recommendations using past and present data to execute changes or deliver insights as required.
Each of these technologies plays a different role in the supply chain. However, combining them could create an ideal solution to improve efficiency.
Tips To Improve
There’s no one-size-fits-all solution to achieving end-to-end supply chain visibility, but there are ways you can improve visibility across your supply chain. Here are a few tips to consider when working to increase supply chain visibility within your organization.
- Know the Status of Your Supply Chain: It’s important to analyze where your supply chain operations currently stand. Start gathering key partners and meet with internal departments to discuss loopholes and how to address gaps. Ask questions and gather information regarding operating costs or customer experience. This process will clarify your current status and point you toward your next step.
- Invest in Supply Chain Visibility Software: Once you’ve set your goals, the next step is to identify a solution worth investing in that can automate the production cycle. You need to look for systems with capabilities that include inventory control, customer demand, and fleet and warehouse management.
This software may range from simple products to a suite of modules that can integrate with core systems like CRM and ERP. - Focus On Improving Processes: Unless your system requires serious process improvements, you can wait on this step till you select a system. Once you’ve chosen, you can discuss the benefits and features with vendors to ensure your team obtains maximum benefits from the product.
- Drive Efficiency: In this step, you’ll start reaping the benefits of your software investment. With in-depth analysis, your team can become experts in identifying areas that need improvement.
Final Thoughts
Looking for ways to enhance end-to-end visibility is like looking for a needle in the supply chain haystack. While many organizations discuss visibility initiatives, few success stories exist. Some companies still lag in adopting technologies that can address their visibility issues.
Although achieving complete supply chain visibility is no easy feat, it is necessary for businesses to generate efficiency, transparency and accountability in their supply chains.
How has supply chain visibility benefited your organization? Tell us in a comment below!