Here are six ways all companies can improve their supply chain visibility and begin reaping rewards like cost savings, improved accuracy, better inventory management and happier customers.
Supply chain visibility has always been the Holy Grail for shippers, with the global pandemic shining an even brighter spotlight on the need to track individual components, sub-assemblies and final goods as they make their way from supplier to manufacturer to distributor to end user. Armed with these insights, companies can more quickly identify potential disruptions, avoid inventory shortages and keep close tabs on their products at any stage in the global supply chain.
Any company still using spreadsheets, manual processes and phone calls to run their supply chains faces steep challenges on the visibility front. Those that have embraced technology and are using supply chain visibility (SCV) platforms and control towers to manage their global operations are faring much better. They’re also much better prepared to deal both with current disruptions and head off future challenges.
6 Paths to Better Supply Chain Visibility
When supply chain visibility is minimal or nonexistent, companies can’t plan orders, collect data, act on that data or operate in a consistent manner. These issues can quickly translate into missed opportunities, financial losses and poor customer service. Here are six ways that organizations can avoid these issues and begin reaping the benefits of good supply chain visibility:
- Identify your biggest supply chain visibility pain points. Pinpoint the issues that would most benefit from increased supply chain visibility. Once you’ve come up with a few ideas, meet with internal departments, Tier I vendors, logistics providers, and other stakeholders to discuss these problem areas, now that’s logistics “Figure out the most pressing issue, then go even deeper, rooting out the specific process, technology, or other solutions that promise the best return on investment (ROI) for your company,” advises global manufacturing firm East West. For many manufacturing and distribution organizations, for example, inventory management may be the pain point most worthy of attention. “This may not be the case for your company,” states East West, “so do your research, review the data, and figure out which area to tackle first.”
- Tear down your data silos. Companies that have been operating with disparate software systems and spreadsheets for years have likely built up a number of data silos throughout their organizations. “This is a definite prohibitor of good supply chain visibility, and it’s something that many organizations are trying to rectify as they move out of the pandemic and into recovery mode,” now that’s logistics points out. “Eliminating these silos not only puts vital data into the hands of the people who need it, but it also greatly reduces reliance on manual labor and the potential for errors.”
- Implement and use standardized internal processes. Monitoring all supply chain activity can be difficult, and especially for large-scale operations spread across multiple locations. The best approach is to establish standardized processes for all the critical elements in the supply chain, including material procurement, warehousing, shipment, packaging, and last-mile delivery. “Standardization ensures that your internal teams follow predefined procedures while carrying out these tasks, and any deviation from the set procedures can be raised immediately,” Locus Robotics’ Nishith Rastogi writes in 6 Best Practices to Enhance Visibility Over the Supply Chain. “It also allows you to take corrective measures without having to micro-manage supply chain operations.”
- Open up the lines of communication. Communication is the key to successful logistics and supply chain management, which is why it’s important to keep communication clear and effective with all the important stakeholders in your supply chain, including suppliers, distributors, internal teams, delivery agents and customers. “On-time and precise communication offers greater visibility within the organization,” Rastogi states, “and improves transparency with the customers.”
- Implement a visibility platform. If you don’t already have one in place, now is the time to invest in good visibility software enabled with artificial intelligence (AI), real-time tracking features and other capabilities. “Visibility tools offer clarity in every stage in the supply chain, enhancing visibility for logistics managers and customers alike,” Rastogi points out. “Managers can remotely track the exact location, shipment and handling details of every order with the help of visibility dashboards.”
- Put AI, ML and other sophisticated technologies to work. Using artificial intelligence and other sophisticated analytical tools, companies can assess whether or not their cargo is at risk from a number of disruptions. For example, if a shipment of refrigerated products is at risk due to unexpected equipment failure, a company can now be notified in real-time. “Using this data,” Asim Rahal writes in How to increase supply chain visibility with next-generation technology, “appropriate departments can make better judgments on responding to the issue, such as rerouting deliveries.” Using AI also helps reduce waste, limit inventory losses, and decrease the chance of missed shipments, all of which help companies reduce risk and save money.
Addressing Supply Chain Issues
According to Accenture, supply chains generate 60% of global emissions and hold 5.5 times more carbon intensity than the rest of the business. It sees commitments to net zero commitments that incorporate carbon-neutral products, production and supply chain; circular economies (going beyond single-use products); and earning trust by mitigating negative environmental and societal impacts as some of the key strategies organizations are using to create more sustainable supply chains.
Accenture also sees technology as a viable tool for companies that are committed to operating more sustainably. “Using digital technology, including supply chain analytics, you can actually measure trust with stakeholders,” says Accenture, which combines artificial intelligence (AI) with ESG data to assess companies’ sustainability. “The result? Transparency and a greater understanding of key stakeholder trust.”
The Path Forward
The question now is, what are organizations doing to make their supply chains even more sustainable, their products and practices more environmentally friendly, and their work places more welcoming and inclusive? JD Supra says many consumer companies are pushing for new ESG standards and certifications that will help them achieve competitive advantage in the market.
Certified B Corps, for example, are companies that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose. Administered by B Lab Global, the certification is one of several ways companies can broaden their views of ESG and supply chain sustainability in an era where Gartner says 85% of investors consider such factors when making investment decisions. “Companies cannot afford to sit idly by and watch from the sidelines,” JD Supra concludes. “With the call from investors amplifying the ESG call from customers, companies must act now.”