The role of visibility in achieving supply chain resilience
High-performance and high-quality supply chains thrive on a deep understanding of the flow of raw materials and goods. Visibility is at the core of this concept.
However, only 6% of logistics companies claim full visibility over their operations, while true supply chain visibility gifts organisations a rich, panoramic view of ongoing operations, and potentially a glimpse ‘over the horizon’. Potential bottlenecks and resolutions, process optimisations and strategic options at each stage combine to drive overall efficiency and effectiveness.
In warehousing and logistics, the ability to track inventory with increased precision, and to better monitor shipments and warehouse ops can offer game-changing commercial and financial rewards to service providers and inventory owners.
Visibility has a crucial role in enabling resilience
More than 57% of organisations are increasing their investments to enhance the resilience of their supply chains (Capgemini 2023).
As the majority of companies increase their investment in supply chain resilience, it’s vital to consider the impact of each dollar put to work. Visibility has a crucial role in enabling resilience.
The key aspects of visibility in enhancing resilience include:
1. Early detection of issues: Visibility allows organisations to promptly identify potential disruptions or issues at various points in the supply chain. Proactive measures can mitigate risks, prevent escalation and in some cases avoid future disruption.
2. Improved decision-making: Informed choices can be based on accurate and timely information. Real-time, high-fidelity data and insights enables real business agility.
3. Effective risk management: Visibility allows organisations to better understand the landscape, and identify where current or potential risk areas might sit. By identifying vulnerabilities and building contingencies or redundancies business leaders can ensure they are exposed only to business and supply chain risks they actively select.
4. Supply chain optimisation: Data is a foundational component of any optimisation. Visibility by definition increases the quality and volume and data and insights, opening up options to more effectively optimise supply chains, address bottlenecks and improve inventory management.
5. Enhanced collaboration: Visibility drives greater company intelligence and operational awareness. This is at the core of effective communication and collaboration with supply chain partners, improving the toolkit to work together during disruptions and business-as-usual.
6. Customer service and satisfaction: Bonds of trust were stretched and strained during the pandemic. Access to real-time visibility not only offers practical solutions to managing supply chains, but a more robust and data-driven basis to communicate and share insights with customers. This transparency enhances customer satisfaction and loyalty, even in challenging circumstances.
Visibility serves as a foundational element of the modern, resilient and efficient supply chain. It can functionally enable better performance in specific silos, but the potential expands much more broadly. Quality, timely, insights can both drive better decision making, but also partnership and collaboration among stakeholders.
“The statistics about 6% of businesses that have full visibility - I think that sometimes we think we have better visibility than we actually have. And even if we have full visibility within our operations and so our warehouses, we don’t work in isolation, we work with partners, suppliers and customers, and it is where we have some gaps in visibility. We need to use more collaboration to extend that visibility.” Maria Torrent-March, Iron Mountain
The transformative power of real-time data
Data is incredibly powerful for how leaders and teams make decisions. Timely, accurate data is a competitive advantage in business, and perhaps even best illustrated in the complex, fast-moving world of supply chain. Real-time data and insights with today’s innovative solutions can transcend traditional boundaries and expectations.
From dynamically adjusting inventory levels to re-routing shipments in response to unforeseen events, the impact of real-time data extends far beyond operational efficiency. It becomes a strategic tool that proactively positions organisations to respond quickly to customer demand, market shifts and unforeseen challenges.
This lack of data is called the Visibility Gap
Strategic gaps in visibility can mask significant economic costs for businesses. At an operating level, tight margins can be further squeezed by the invisible hands of inefficiencies and costs of disruption. Meanwhile, slack within inventory management can tie up meaningful financial capital and impact commercial performance.
“From a 3PL perspective or warehousing, the visibility gap is the difference between efficient operations and inefficient ones. We do talk about it in the business, and we tend to talk about it more when things go wrong. I think a more proactive approach would be better, and try to map all the processes and spot those gaps.” Maria Torrent-March, Iron Mountain
Numerous challenges stand in the way for companies. Determining the types of data to collect, grappling with the multitude of elements in play, ensuring accuracy and continuity, and then translating those insights into actionable steps – it's a complex puzzle.
Advanced robotics technology offers a promising solution, leading to a rapid increase in accuracy. However, addressing the efficiency drain also demands swift action when discrepancies arise, underscoring the importance of not only improving accuracy but also implementing efficient processes for timely resolution.
Explore all our recommendations and opportunities to achieve full visibility over your supply chain
