Why Is Supply Chain Visibility Gaining Momentum?

Posted by Martin Verwijmeren on Jan 13, 2020 1:02:09 PM

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Supply chain visibility has always been important. Yet, in 2017, improving end-to-end supply chain visibility only ranked 6th as a top objective, according to Geodis’ Supply Chain Worldwide Survey. It didn’t take long for practitioners to begin seeing the capability as a fundamental necessity and not just a tool that would be ‘nice to have.’ In fact, responders to Gartner’s latest SCM Technology User Wants and Needs Study named end-to-end visibility as their top funded initiative.

So, what’s suddenly motivating companies to prioritize this capability?

Today’s supply chain complexity creates many blind spots

There was a time when an analytics dashboard would have sufficed to secure a centralized view of your data, as well as set and report on some KPIs. Today, such a system barely scrapes the surface of what businesses need to prosperously run complex, global supply chains and deliver exceptional customer service.

International operations are exposed to environmental and political change, and therefore a lot more uncertainty than small, locally run businesses. As businesses expand globally, they also become multi-modal. Not all technology supports every mode, leaving companies to struggle with limited visibility – or else several siloed solutions – as they scale. This goes tenfold for logistics service providers who manage a substantial number of varying supply chains for their customers.

Multi-enterprise business networks also contribute to today’s supply chain complexity, as organizations are building and leveraging partnerships with everyone from manufacturers and distributors to logistics service providers. Moreover, each set of business processes doesn’t exist in a vacuum but is part of a greater ecosystem. Lacking one version of the truth, as well as contextual insight into how upstream and downstream flows affect one another negatively impacts efficiency, profitability, and a company’s ability to effectively optimize operations as a whole.

supply-chain-visibility-ecommerceThe advent of e-commerce further pressures businesses to leverage these partnerships with dynamism and intelligent flexibility through complex models of fulfillment. Without proper visibility, it becomes next to impossible to optimally choose between multiple sources, delivery points, and logistical processes to consistently ensure profitability and customer satisfaction.

 

Old architectures and incremental upgrades don’t do enough to purge the blind spots

Some businesses may have put visibility low on the list because they felt their company was running well enough and preferred to deal with more ‘pressing’ and imminent problems. Those who did see supply chain visibility as a concern tended to address the matter through incremental upgrades. Rather than treat the supply chain as a large, complex ecosystem, it’s been common practice to address pain points within sectors and maximize the functionality of each separate branch, focusing on the manufacturing or warehousing sector or investing in a logistics control tower for greater transport visibility.

It took a while for supply chain visibility to gain extraordinary momentum. This has much to do with practitioners realizing the crucial role this capability plays in such ‘pressing and imminent’ problems as cost control and boosting customer satisfaction. Mainly because most issues – poor inventory management, ineffective communication, exorbitant errors and delays – either boil down to a lack of visibility or else cannot be resolved without first implementing a proper supply chain visibility solution. Visibility is a necessary foundation to all other supply chain functions.

That brings us to our second problem: old architectures and incremental upgrades. Because visibility was long seen as a modifier to more fundamental systems (WMS, TMS, etc.), supply chain visibility has also been implemented in silos, modifying the system it was purchased for. This is why ‘end-to-end’ visibility, specifically, has ascended in the ranks to become one of the most sought-after solutions. At best, a visibility solution will span the end-to-end logistical supply chain but won’t do much to provide context into sourcing or reverse flows, for example.

Transitioning to a multi-enterprise orchestration platform

Businesses are realizing that supply chain visibility needs to extend beyond discrete functions and logistical concerns (i.e. the location of a shipment, exceptions alerts, compliance). Because, in addition to delivering on-time and in-full (OTIF), businesses must do so profitably. That means taking a holistic and unified view of the supply chain to understand how previously isolated functions and processes affect one another.

supply-chain-visibility-networksThe multi-enterprise orchestration platform is a holistic technology that unifies the disparate sectors of the supply chain. It enables businesses to “orchestrate” fulfillment across their end-to-end network rather than manage the various process and sectors in isolation.

Treating the network as a multi-party ecosystem offers extraordinary opportunities for improving service while controlling costs. With insight into the greater ecosystem, businesses gain contextual insight into how all processes and flows impact each other. Optimization and cost considerations begin at the level of sourcing rather than shipping and span all modes, as well as interplant, returns, repairs, and rebalance flows. Holistic supply chain visibility therefore allows businesses to dynamically source inventory, converge flows, and make highly informed and strategic decisions that positively affect all processes and partnerships.

Today, visibility is not just a convenient systems upgrade – it’s part of a greater movement to adopt a more unified perspective of the supply chain and begin treating it as the complex ecosystem it has become.

 

For unparalleled end-to-end supply chain visibility, MPO offers the world’s only Control Tower for Orchestration on a single, unified cloud platform. Businesses operating in a range of industries can leverage this powerful solution to gain transparency across the entire multi-party network and optimize their complex, global supply chains to reach unprecedented levels of efficiency, customer service, and cost-savings. You can learn more about how it will serve your business by requesting a demo or downloading our free white paper today!

Digital Control Tower White Paper

Topics: Supply Chain Visibility, Supply Chain Complexity, Control Tower, Multi-Enterprise Business Networks

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