Supply chain operations remain top of mind for companies across the globe. Airfreight warehouses and shipping ports are backlogged, and the cost of transporting goods has risen exponentially as pandemic pressures disrupted familiar supply chain routes even as customers made the move to online ordering that came with promises of free, fast delivery. Put simply, the supply chain crisis isn’t over yet. And while it’s impossible for businesses to predict exactly what will happen next, it’s critical for companies to detect signs of supply chain disruptions as early as possible — in practice, this starts with supply chain visibility.
But what exactly does this mean? Why does visibility matter so much, and what can companies do to make sure they’ve got a clear line of sight into their supply chains at scale?
What is Supply Chain Visibility?
Supply chain visibility is the ability to see all aspects of the supply chain, both internally and externally. Traditionally, this was relatively simple to achieve, since many companies leveraged either single-source suppliers or were used suppliers who were directly connected with the business, making it possible to access key data with minimal difficulty.
The advent of global production, logistics, and tracking solutions, however, created a much more complex supply chain environment that saw companies using multiple providers to supply a single component and juggling multiple data sets to ensure raw materials and finished products were produced, shipped and delivered on time.
Early-stage pandemic shutdowns across the globe disrupted this interconnected supply chain model, in turn leaving many companies in the dark.
Why Does Visibility Matter?
Accurate, real-time data now drives business success. Without supply chain visibility solutions, however, companies simply don’t have access to the data they need, when they need it, in turn, frustrating efforts to drive business growth, boost customer retention and improve long-term decision-making.
Consider a US company with multiple suppliers across south Asia and Africa. Differing timelines for procurement, production, and shipping mean different dates for the arrival of raw materials or finished products — if companies don’t have complete visibility into these timelines, they could face significant challenges. For example, if multiple shipments arrive simultaneously, available inventory space could be overwhelmed. If target dates aren’t met, meanwhile, businesses could experience an unexpected gap in product availability and inventory levels, in turn creating shortages.
In either case, the results are problematic for revenue, reliability, and customer retention.
What are the Benefits of Supply Chain Visibility?
Supply chain visibility (SCV)offers benefits for businesses optimization in four key areas:
Better insight into supply chain challenges makes it possible for businesses to take action before small issues become big problems, in turn reducing the risk of significant delays. This boosts overall supply chain planning — paired with improved risk management analysis that leverages new solutions such as machine learning and artificial intelligence, it’s possible for companies to avoid common supply chain bottlenecks and drive increased process sustainability.
The interconnected nature of global supply chains naturally creates complexity, and complexity, in turn, creates blind spots that negatively impact business performance. Visibility reduces complexity by providing a single source of supply chain truth that allows staff to address logistical issues and avoid potential errors. Armed with the right metrics, businesses can improve supply and inventory management across their entire supply chain without introducing additional complexity.
Stakeholder and customer satisfaction increases with visibility because companies are less likely to miss deadlines and revenue targets. Instead of simply hoping for the best when it comes to production and delivery, visibility makes it possible for companies to take the pulse of their supply chain on-demand to discover where things are working and where improvements are required across supply chain processes.
Better visibility means reduced spending. Instead of paying a premium to make last-minute logistics shifts because a specific supplier couldn’t meet their obligations, companies can see these issues coming and take action to avoid overspending.
How do Companies Create End-to-End Visibility?
Creating full visibility starts with a recognition that evolving global supply lines are inherently complex and ever-changing. Currently, stable chains could experience sudden interruptions due to political pressures, disease outbreaks, or the rising costs of sourcing, manufacturing, and transportation.
Next, companies need to leverage technologies capable of managing and monitoring supply chain challenges at scale to forecast potential issues. This means finding and deploying supply chain management (SCM) solutions capable of collecting key data from multiple sources to create a single source of supply chain truth that companies can easily access, search and review. In addition, it’s worth adopting supply chain visibility software solutions that aren’t tied to a specific platform or device — true supply chain visibility requires access anytime, anywhere to ensure companies can take appropriate action ASAP.
Capturing Supply Chain Clarity
When it comes to supply chain data, the more visibility, the better. Armed with real-time visibility around current operations and potential problems, companies are better prepared to act — rather than react — as supply chain challenges evolve.
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