June 5, 2024 - 8 minutes read
3 ways visibility software changes supply chain visibility
As businesses face increasing challenges in the global market, visibility is a critical driver of success and a crucial component of digital transformation. Speed to market, cost management, regulatory compliance, global risk management, and supplier cooperation are all more important, scrutinized, and driven by data than ever before. A recent study by APQC found that 84% of respondents have re-evaluated or modified their supply chain strategy to navigate complexities, with a strong focus on adaptability and a proactive approach to risk management.
Accordingly, supply chain visibility tools and the ability to act on information in real time are competitive necessities that modern businesses cannot afford to ignore.
What is supply chain visibility?
Supply chain visibility refers to the ability to track and monitor the movement of products, materials, and information throughout the entire supply chain, from the sourcing of raw materials to the delivery of finished goods to the end customer. It involves gathering real-time data and insights about various aspects of the supply chain, such as production processes, transportation, and distribution.
Why is visibility important?
Visibility is essential for building a resilient, agile, and efficient supply chain that adapts to changing market conditions and customer demands.
Short-term impact
In the short term, visibility in supply chain provides immediate benefits, such as proactive risk mitigation. Visibility allows potential disruptions to be detected early, enabling businesses to take proactive steps to mitigate their impact. Real-time insights into supply chain operations enable companies to respond quickly to changes in demand, supply, or market conditions, improving agility and flexibility. Additionally, visibility facilitates better communication and collaboration among supply chain partners, leading to a faster resolution of issues and improved coordination.
Long-term impact
Over the long term, there are many strategic advantages of supply chain visibility. Historical data collected through visibility solutions provides valuable insights into trends and patterns, enabling businesses to optimize processes, reduce costs, and improve overall efficiency. Visibility also allows key performance indicators (KPIs) to be accurately tracked and measured, creating a clear picture of supply chain performance and enabling data-driven decision-making. Finally, a comprehensive understanding of the supply chain empowers businesses to develop more effective long-term strategies, anticipate future challenges, and make informed investment decisions.
Visibility challenges in 2024
While the importance of supply chain visibility is undeniable, it is difficult to achieve in a complex and dynamic environment. Top things that hinder supply chain visibility include:
1. Legacy systems and technology adoption
Many organizations still rely on legacy systems that are not equipped to handle the demands of modern supply chain visibility. These legacy systems typically:
- Provide only a partial view of the supply chain, making it difficult to track goods and identify potential disruptions;
- Rely on slow manual data entry and tracking processes;
- Lack the capability to integrate with other systems and platforms.
Upgrading to modern, cloud-based visibility solutions can be a significant investment, but it’s what helps companies stay competitive and resilient.
That being said, technology adoption itself can be a hurdle. This is echoed by the APQC survey, which reveals that 52% of respondents have identified the new technology implementation as a significant challenge.
2. Data silos and fragmentation
Internal departments, such as procurement, manufacturing, logistics, and sales, often operate within isolated systems and datasets, while supplier and transportation providers operate in their own external systems. This lack of integration creates a massive amount of disparate and fragmented data, making it difficult to obtain a complete view of the supply chain and hindering the ability to make well-informed decisions.
3. Lack of real-time tracking
Real-time tracking is the mainstay of supply chain visibility, yet many businesses still rely on outdated systems that offer only periodic updates, leaving them with a delayed view of their operations. This lag in information limits the ability to respond quickly to disruptions, leading to delays, increased costs, and customer dissatisfaction.
4. Inefficient collaboration
Global supply chain visibility often spans continents and involves a multitude of stakeholders. The error-free exchange of information ensures efficiency, responsiveness, and customer satisfaction.
For instance, imagine a supplier experiencing a production delay that will impact the delivery of critical components. Without efficient communication channels, this information might not reach the manufacturer until it’s too late, leading to production downtime and missed deadlines. Similarly, if internal teams lack collaborative tools, miscommunication can result in inaccurate order estimates, delayed shipments, and increased costs.
5. External disruptions
Modern supply chains are increasingly vulnerable to a wide range of external factors that can disrupt operations and impact visibility.
- Political instability, trade wars, and sanctions can disrupt the flow of goods and materials across borders;
- Earthquakes, floods, hurricanes, and other natural disasters can severely disrupt supply chain operations;
- Economic downturns, recessions, or sudden shifts in demand can create significant challenges for supply chains;
- Pandemics, like the COVID-19 outbreak, can have a devastating impact on global supply chains.
These factors, typically beyond a company’s control, can create significant challenges and require proactive strategies to mitigate their impact.
H2: Key components of supply chain visibility
When effectively integrated, supply chain visibility technology provides a holistic understanding of operations, enabling decision-makers to make informed decisions, optimize processes, and mitigate risks.
- Data capture
Capture accurate and timely data from across the supply chain network, including information from suppliers, manufacturers, and logistics providers, to fuel effective visibility solutions. This means using technology solutions like Enterprise Resource Planning (ERP) systems, Supply Chain Management (SCM) software, and other data analytics tools. - Data integration
Consolidate, integrate, and normalize data from various sources and systems, breaking down silos and creating a unified view of the supply chain for informed decision-making. - Real-time monitoring
Continuously track the status and progress of products and materials as they move through the supply chain, enabling proactive responses to disruptions and minimizing their impact. This includes tracking the location of shipments, monitoring the status of production processes, and receiving alerts for any disruptions or delays that may occur. - Analytics and reporting
Data analysis provides insights into supply chain performance. Data visualization tools and dashboards often present this information in a clear and actionable format, enabling businesses to identify trends, patterns, and opportunities for optimization. - Collaboration
Foster open communication and collaboration among stakeholders, sharing information proactively and working together to optimize processes and address challenges. - Risk management
Proactively identify and mitigate risks, such as supply disruptions and demand fluctuations, by leveraging real-time visibility and developing contingency plans.
By adopting these elements and making the most of new technologies, companies will enjoy a new level of transparency and governance in their supply chains.
How does the visibility platform benefit a supply chain?
As supply chain leaders face a series of challenges, visibility platforms offer a solution, helping to achieve operational excellence.
Beyond track and trace
Modern visibility platforms ensure the following visibility types to provide a 360-degree view of supply chain operations:
- In-transit visibility: Real-time tracking of goods in transit, using technologies like GPS and RFID, to provide insights into location, condition, and estimated time of arrival (ETA).
- Transactional visibility: Monitoring and analyzing transactions within the network, including purchase orders, invoices, shipments, and payments.
- Financial visibility: Gaining insights into the financial health of operations, covering procurement, production, and transportation to identify cost-saving opportunities and improve profitability.
In terms of data ownership, platforms allow entities to address the question of who owns and accesses supply chain data, which ensures accountability, transparency, and data security.
Data centralization
A robust visibility platform aggregates data from various sources, internal and external, into a unified hub. This translates into the following benefits:
- A unified view consolidates data from ERP, TMS, and carrier portals into a single platform, providing a holistic understanding of all shipments and transactions.
- Centralizing domestic and international rating, booking, and tracking processes improves efficiency and control.
- A centralized repository stores and provides access to critical shipment documents, including bills of lading, proofs of delivery, and invoices, for easy retrieval and analysis.
Hence, businesses can make more informed decisions, identify hidden risks, and optimize their operations by having all relevant information readily available in one place.
Improving communication and collaboration
Visibility platforms provide a shared platform for data access and communication for all stakeholders. This leads to improved coordination, faster response times, and proactive problem-solving, enhancing overall supply chain agility and responsiveness.
Key features include real-time data sharing, which connects stakeholders with up-to-the-minute shipment data. Businesses can also eliminate routine inquiries by providing self-service access to supply chain partners, while interactive reporting simplifies issue resolution.
Data ownership
Visibility solutions ensure that businesses maintain complete control over their shipping records, which protect critical data to ensure regulatory compliance. Businesses can also leverage this data for strategic insights, and the control allows them to meet regulatory requirements and industry standards.
Teams can also utilize historical data to analyze trends, identify areas for improvement, and make smart decisions that drive business growth.
Reporting and analytics
Centralizing all supply chain data within a single platform helps companies leverage powerful reporting and analytics tools, through which they can identify trends and patterns to help them run more smoothly.
Companies can also use custom KPIs and data visualization tools to easily interpret complex supply chain data and generate reports tailored to their specific needs. Scheduling and automating the delivery of custom reports ensures that stakeholders receive critical insights in their preferred format. This allows businesses to unlock valuable insights from complete, accurate, and timely data to drive performance improvements. Integrating data from internal and third-party systems provides a comprehensive, real-time view of logistics operations, enabling proactive monitoring and better response to potential disruptions.
By implementing a comprehensive visibility platform that encompasses these components, businesses can unlock the full potential of their supply chains, achieving greater efficiency, cost savings, and customer satisfaction.
Achieve end-to-end visibility with the Agistix platform
Agistix enables businesses to take on supply chain challenges with its comprehensive suite of solutions. The Agistix platform ensures visibility by providing a real-time view of the entire supply chain, from raw material sourcing to final delivery. It allows businesses to track shipments, financial documents, and more to address disruptions proactively. Agistix TMS optimizes transportation management with advanced features for rating, bidding, and more, streamlining logistics operations and reducing costs. Furthermore, Agistix Microsites foster easy collaboration across the supply chain network by equipping stakeholders with self-service access to critical data.
By leveraging the power of Agistix’s integrated platform, businesses achieve true end-to-end visibility, helping them to optimize their operations and build a more resilient and agile supply chain. Book a free demo today!
