Why is supply chain visibility still out of reach for many businesses?
Supply chain visibility has featured in most strategic reports for the past 10 years, with statements such as ‘two-thirds of supply chain leaders see supply chain visibility as a top strategic priority’ continuing to feature as headlines.
Those familiar with such analysis will understand the advantages visibility can deliver and the growing necessity to do so as global supply chains grow more interconnected and complex, yet surely the standout question is: if so many recognise the importance of visibility, why does it remain a top strategic objective. This statement surely implies that many businesses are yet to harness supply chain visibility in a meaningful and transformational way.
Maybe a lack of data?
There are reportedly over 10 billion IoT devices now deployed globally, with that number predicted to surpass 25 billion by 2030. Of course, not all these devices are present within the supply chain, but it does indicate that the prevalence of connected devices is rising and the subsequent cost reduction will only drive up the number of devices generating data in all walks of life.
Looking specifically at the supply chain, most HGV’s have some form of GPS reporting capability. Trailers are more connected than ever, capable of reporting temperature, weight distribution, even when or if they have been opened. Inside warehouses, some systems enable more efficient and accurate operations, robots moving products from the shelves to the loading bays.
Outside of the IoT phenomenon, the number of IT systems used by businesses within the supply chain is again growing at a fast rate. With most of these systems cloud-based, they too provide a huge and powerful source of data that can be leveraged to achieve what is referred to as ‘supply chain visibility’.
So, the problem is not a lack of data…
In most cases, the problem is not a lack of data. Instead, the challenge is how that data can be collected and brought together to deliver the visibility outputs businesses seek.
The supply chain visibility challenge is unique in that many supply chains are made up of multiple stakeholders, each performing a role. These stakeholders operate their own systems (be it IoT or IT) in which resides the data that is needed to deliver end to end visibility throughout the supply chain.
If you look at the ‘in-transit parts of the supply chain, at a minimum, there will be three stakeholders involved: the seller of goods (trader/origin), the buyer of goods (customer/destination) and the mover of goods (logistics). Each of these stakeholders operates systems that contain data relevant to the goods moving between the parties.
If businesses can ‘tap in’ to the data available, across all stakeholders, they can get a complete, real-time picture of the goods moving through the in-transit part of the supply chain, from which they can capture events. The challenge is not a lack of data. The challenge is the collection, processing, and orchestration of data across multiple stakeholders and their respective systems.
Future leaders will get this right, maximising the data they have within their supply chains, laying the groundwork for future digital transformation.