Is your supply chain as crystal clear as it could be?
Do you sometimes get the impression that your supply chain lacks transparency? If so, you are not alone.
Companies are increasingly working with manufacturers in more origin locations, reaching more destinations, using more routes and transport service providers, and utilising additional channels to end users. Its no surprise that the end result is a complicated network. The individual parts can be optimised to satisfy local KPIs, but this does not guarantee maximum efficiency for the supply chain as a whole.
Poor transparency not being able to see everything that is going on in the supply chain, from one location and in real time leads to many challenges, including lack of control, problems with customer service, unnecessarily-high costs, and vulnerability to risks.
The many flavours of transparency
The transparent supply chain involves creating a single, shared, workable version of the truth for all involved parties. In IT terms, many companies have tried to achieve this by using proprietary software, ERP-based systems, or spreadsheet/XML solutions.
None of these have been entirely satisfactory, not least because the variety of approaches involved actively hinders the desired transparency.
New approaches are now available as cloud-based solutions, which have the advantage that all users see the same information and are using the same version of the software at the same time. As well as pure software vendors, a number of 4PL logistics providers have now entered the market too. By combining a cloud solution with their in-house supply chain expertise, the value-add is even greater.
Whichever route is taken, the key components of a truly transparent supply chain solution should deliver full visibility, real time control, and swift optimisation.
Benefits of a crystal clear supply chain
A fully transparent supply chain creates or enables a wide range of commercial and organisational benefits. The transparent supply chain is:
- Agile and resilient: rapid reaction to changes such as customer demand or technical development, and a much faster reaction to natural disasters, strikes and similar.
- Cost effective: procurement and inventory management is more accurate and timely; resources are scaled and utilised more effectively; administration becomes less repetitive and more accurate.
- Compliant: it is easier to meet regulatory requirements across the chain, from customs clearance to social responsibility reporting.
- Collaborative: there is an easier alignment of strategic goals throughout the supply chain, instead of mainly focusing on individual or shorter term tactical goals.
- Continuously improved: development opportunities are clearer and can be processed faster.
The road to transparency
Implementing a transparent supply chain is challenging but rewarding, regardless of a companys starting point. Beyond technical changes, shifting to an attitude of real collaboration and sharing of data that used to be considered confidential may require a fundamental change in the organisational culture.
Rest assured, significant levels of transparency and its benefits can be achieved through collective perseverance and hard work. As in many cases, the orchestrators of your supply chain, your lead logistics service providers may be a particularly important component in the journey towards a crystal clear supply chain.
More information
Damco experts are available to discuss with you how to achieve a crystal clear supply chain. A starting point is the Damco white paper on this topic which is available for download here.
