HOW TO GAIN SUPPLY CHAIN ENLIGHTENMENT
By: Phil Sneed
How to Gain Supply Chain Visibility
If there’s one buzzword that continues to define supply chain management, it’s visibility. Everyone wants it but few seem to ever approach true nirvana. Part of the difficulty in this endless search for total insight and control is that companies have different interpretations of what visibility means, and these interpretations continue to evolve with varying business demands and globalization trends.
Visibility is knowing where inventory is at any moment. But it is also actionable information that can help support customers and be applied to myriad touch points along the supply chain—from supplier to service provider to end customer—to remove redundancies and improve processes.
Because businesses often focus on capitalizing core growth initiatives, many do not have the internal IT infrastructure to support dynamic supply chains. Collecting and identifying data that is important, validating this information, and communicating it in a way that lets others leverage this visibility remains a critical challenge for companies large and small.
6 STEPS TO SUPPLY CHAIN ENLIGHTENMENT
STEP 1. Open lines of communication among all parties involved. Visibility means different things to different companies. So you have to define what your enterprise is looking for, as well as what visibility, and how much, is important to the customer.
Is it visibility into freight capacity? Is it mode-specific, domestic, or international? Is it exception-based or 24/7/365?
Companies often don’t know where they need to be, or where they can go, so it is important to work collaboratively with supply chain partners to set expectations and progress accordingly. All stakeholders, including different levels of operations and executive management, and silo functions within the company and throughout the extended enterprise must be involved.
STEP 2 Trust your partners. Visibility is built on sharing information and trusting service providers with that information. Identify the role a 3PL, forwarder, or carrier will play, and trust it knows what it’s doing. If you have built a relationship, established benchmarks, and aligned expectations, everyone knows what they are accountable for. Misaligned goals, or a failure to trust supply chain partners with vital data, planning, and execution, will ultimately leave all parties disappointed.
STEP 3 Invest in technology. The only way to drive better visibility is to invest in the technology infrastructure and resources to gather and act on necessary information. End users can either partner with a service provider that has the technology and resources to execute, or find a stable of partners—and build relationships with each one—to ensure expectations are paired.
STEP 4 Set key performance indicators. If you need 90 percent international tracking online by next quarter, set that as your goal. Be clear and concise in defining your expectations, then diligent in setting measurable benchmarks to ensure you progress toward those goals.
STEP 5 Know your customers. Enhanced visibility penetrates supply chains in many ways, so it is important to identify all stakeholders in any business process improvement effort. Be sure the decisions you make and the partners you work with understand the impact on all parties involved and that they are working to support these respective interests.
STEP 6 Identify cost savings and business process improvements. As stated in Step 1, understanding each supply chain stakeholder’s visibility needs will help optimize processes, reduce inefficiencies, and drive out costs on the back end. Again, it is important to open up avenues of communication among all parties to discuss how better managed information and insight into inventory management can be optimized individually to improve the whole. Identify how much time different partners are spending to gather necessary visibility without getting what they need. Then consider where gaps exist and explore synergies.