Supply-chain visibility has become a focal point for many companies, prompting the need for a deeper understanding of this crucial aspect of business operations. When embarking on the journey to enhance supply-chain visibility, there are three essential factors that require consideration before committing to substantial changes.
- Scope of Visibility: The term “supply-chain visibility” can encompass various interpretations, which influence the level of data, technology sophistication, and collaboration required to realize this vision. It is essential to define the scope clearly to meet specific business needs. These scopes include:
- In-Transit Transparency: This involves tracking the movement of products from the moment they are shipped until they reach their final destination, including all intermediary nodes.
- End-to-End Visibility: Encompassing the entire supply chain from supplier to manufacturer to buyer, this perspective aims to provide comprehensive insights.
- Full Supply-Chain Visibility: Extending beyond Tier 1 suppliers, this level of visibility covers the entire journey from raw materials to the end of a product’s life.
Determining the scope has significant implications for data requirements, technological solutions, and the level of collaboration needed to achieve the desired visibility.
- Components of the Solution: Business leaders should understand that supply-chain visibility is not achieved through a single solution but rather by a combination of different components working in tandem. To attain the necessary insights, efforts are required to integrate various elements. These components include:
- Technology for Data Capture and Translation: Employing technology to capture and translate information into digital formats.
- Tools for Information Transmission: Utilizing tools to transmit and upload information across supply-chain partners.
- Systems for Actionable Insights: Implementing systems that access and make the information actionable for supply-chain managers.
- Asking the Right Questions: To effectively enhance supply-chain visibility, it is crucial to ask the right questions and focus on specific key performance indicators (KPIs). Rather than vague or open-ended requests for more information, inquiries should revolve around key supply-chain issues. These might include concerns related to supplier risk, inventory variability, delivery challenges, or environmental impact.
Outlook: Supply-chain visibility will continue to be a prominent trend across various industries, with a growing emphasis on precise language to define its scope. The need for visibility in diverse contexts is expected to increase in response to customer demands for responsible corporate practices and the necessity to improve performance within margin-constrained markets. As businesses strive to meet these demands, a better understanding of supply-chain visibility and its components will play a pivotal role in their success.
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