What is Supply Chain Visibility?

Supply chain visibility tracks a product from its raw materials, to manufacturing, and then up to its customers. This visibility lets organizations keep track of their product through all steps in the supply and distribution chain, reducing errors and improving customer satisfaction.

Supply Chain Visibility Diagram

This visibility allows organizations to identify areas in the supply chain that cause delays or unnecessary expenditure, improving production efficiency. Supply chain visibility requires transparent and full access to every transaction from every department, across the entire supply chain. This data, historically, while being available through various methods and systems, has been contained in data silos within a particular department. Supply chain visibility requires this data to be available across every step of the supply chain in a unified view.

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How Does Supply Chain Visibility Work?

The workflow of a typical supply chain management can be split into three parts:

  • Product: The product flow includes data related to production, storage, delivery, and quality.
  • Information: This data includes all the sales and purchase orders as well as delivery statuses. The accuracy of this information is critical to streamlining other workflows.
  • Finances: This deals with all the finance-related data such as purchases, invoices, inventory management.

Various systems and tools should already be in place to capture this data. Processing and analysis of this data in real-time ensures complete and transparent visibility across all stations of the workflow. The challenge is when the data is from various systems in different formats and needs to be integrated for a singular solution. There are various software systems in the market that analyze and interpret data to provide a solution.

Supply chain visibility works on two levels: low and high visibility environments. For example, in a logistics providing company, one generally plans for shipment. But sometimes a power disruption at the client’s factory might cause a delay in their shipment, affecting the logistics company.

In a low-level scenario, the logistics company is not aware of the workflow at the client’s end and will not be able to anticipate this delay. This forces the logistics company to either delay the transportation of the freight (resulting in the delay of all the other shipments) or to go ahead with the shipment as planned but without the client’s products, affecting the client relationship.

In a high visibility scenario, the logistics company is integrated with the client’s systems using shared IT infrastructure. This puts the logistics company in a position to anticipate the delay in real-time with the client. Using advanced analytics, the logistics company can reorganize the routing and revise the estimated time of delivery, keeping both companies happy.

Supply chain visibility at a higher level includes shared IT integration across all stakeholders in the workflow. This allows decision-makers to share common data, reducing any delays or problems in the workflow.

Why Use Supply Chain Visibility?

The supply chain process is increasingly complex with multiple vendors and solution providers at every level of the process. Low-level supply chain visibility is inefficient and unintuitive.

Newer solutions are not only intuitive but also integrate into various formats easily. Their use of advanced predictive analysis algorithms minimizes errors and creates more efficient decisions.

What are the Right Features for Supply Chain Visibility Software?

With increasing supply chain complexity, the organization’s chosen solution needs certain features to help run it more efficiently. For example, while carrying goods, shippers use multiple modes of transport. This means information comes in multiple formats, making it difficult to establish a single format for all logistical data. This causes inefficiency and an increase in administration costs that can jeopardize the company’s reputation and result in a bad customer experience.

It is crucial that the technology undergoes strict assessment. A few checkpoints can help shortlist the most efficient one for an organization’s needs:

Track Record

A good indication of an efficient supply chain visibility software is a proven track record in customer service from reputed companies. From the installation of tracking devices till their return within the supply chain, businesses require constant monitoring and customer service at every stage of the workflow. So, selecting companies that are consistently good at this is crucial.

The Simplicity of Integration with Legacy Systems

As supply chain technology gets more and more complex, legacy system technology becomes obsolete and inefficient--as they are not scalable and do not meet the growing standards and needs of the industry. Legacy systems also tend to give solutions to only one part of the workflow in the supply chain, often ignoring and remaining incompatible with the other formats used by other processes. Decoding these, while trying to integrate them into other legacy systems, makes the process inefficient and often inaccurate. It is necessary to use solutions that are transparent, scalable, and easy to integrate.

Analytical Capability

Analytical solutions find shortcomings and issues in the supply chain process. Predictive analysis makes the supply chain process more proactive. Efficient analytical software has several features: prediction accuracy, optimized performance, improved tracking capability, and product return analysis. While it collects data, it should also be accurate and easily understood.

Data Security

Security is one of the most vital aspects of a software solution. Supply chain visibility software contains a range of customer data, critical business information, finance reports, and supply chain protocols. These are sensitive to the operation and business strategy of any company. Any leakage can cause serious damage to trade secrets and other intellectual property.

A truly efficient supply chain visibility software contains information shared by every station involved in the supply chain process. While there is a large amount of data exchange, it can be vulnerable to cyber-attacks--leading to large financial losses. Security is one of the most important aspects to assess while purchasing supply chain visibility software.

Ease of Use

Organizations should take user experience and intuitive systems into account when choosing a software solution. Since various departments will use the software along the supply chain process, usability helps employees integrate data and understand other station data. The interface should be intuitive and easy to navigate so that users can access the right data, without misreading information.

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Challenges of Supply Chain Visibility

While trying to keep up with complex supply chain processes, there are some challenges supply chain visibility solutions face:

Information Silos

Most supply chain information is restricted to certain departments. Supply chain visibility solutions need to consider each format of the information, without leaving out any department in the process; it also has to manage and ensure data integration.

Taking Smaller Vulnerabilities for Granted

It is essential to map out the supply chain’s vulnerabilities and weaknesses without missing details, so organizations can make faster decisions when lower-level suppliers are hit. In the case of pandemics, economic depressions, and trade wars, a supply chain map will help companies guard against supply chain disruptions by taking all suppliers into consideration.

Keeping up with ever-changing supply chain processes makes it difficult to come up with a common solution for any business, so visibility software needs to constantly update to compete with market and customer demands.

Supply chain visibility is evolving as one of the most efficient business strategies these days. Its constant evolution gives companies a competitive edge in an increasingly unpredictable environment.