Supply chain visibility gaps

How to Gauge Visibility Gaps in Your Extended Supply Chain

Supply chain visibility gapsBy David Parker, Chief Evangelist

This is the third blog post in a four-part series on defining, assessing and improving supply chain visibility as companies drive their digital transformation.

To learn more about supply chain visibility, read the Supply Chain Visibility Index: The Definitive Guide.

So, you’ve analyzed your extended supply chain and have identified several visibility gaps. Now what? It’s time to take a closer look at those gaps to understand exactly where they are, how many you have, and most importantly, what impact they might have on your organization. You can leverage these discoveries to help you identify key areas that you want to invest in.

It may help you to know that most companies have significant visibility gaps. Here are some common data “black holes” that companies typically need to shed light on:

  • Continuous, live monitoring throughout your manufacturing facility
  • Complete tracking as your product flows through your distribution center
  • Live tracking of your products’ condition at the pallet level, as your products move in-transit
  • Continual status of your products and their conditions, starting with your suppliers and continuing all the way through to customer destinations

In fact, most companies lack over half of the ways to monitor and improve their operations – both internally and with their partners throughout the ecosystem.  If you think that you can merely rely on EDI transmissions, RFID, and barcode data capture at select facilities and while in-transit is enough, think again.

What’s the path forward? At Cloudleaf, we’ve defined a visibility maturity measure called the Supply Chain Visibility Index (SCVI). The first step is to identify what your SCVI is today. Then, after a strategic review, you’ll need to set your target SCVI across your supply chain (such as 75% SCVI). Set the target high, so that achieving visibility levels beyond your target would result in limited additional value. By improving your SCVI, your entire ecosystem will benefit, whether it’s an increase in revenue, recognizing revenue at the earliest opportunity, or a lower cost of operations.

Keep in mind there are many pivotal points to investigate throughout your end-to-end ecosystem. By gaining more points of complete visibility, you’ll accelerate your company’s progress toward an intelligent, digital ecosystem and demand-driven maturity (Figure 1).

Supply chain visibility digital ecosystem

Figure 1: Gaining more points of complete visibility through your end-to-end ecosystem builds supply chain capabilities and enables accelerated progress toward demand-driven maturity.

The manufacturing plant is a typical black hole in supply chain visibility. This part of the supply chain is often disconnected, but if you want to graduate to a demand-driven ecosystem, it must be visible in great detail. You’ll soon discover that there are many points throughout your production facility where you can derive enormous value from gaining complete visibility, whether it’s in dwell time at the receiving stage, condition alerts in the manufacturing line, quality compliance, and much more (Figure 2).

Diagram of a digital supply chain ecosystem

Figure 2: Plant operations are at the center of every supply chain; to gain maturity, many key product milestones need to be visible throughout your enterprise and ecosystem.

You have an incredible opportunity to create new value by closing visibility gaps in your supply chain; cost reduction is just the beginning! By achieving greater supply chain visibility, you’ll be able to discover new revenue opportunities across your organization, drive out costs, and delight your customers.

All blog posts in this series:

  1. The 5 Stages of Supply Chain Visibility Maturity: Where is Your Company?
  2. Top 5 Reasons Your Supply Chain Has Visibility Gaps
  3. How to Gauge Visibility Gaps in Your Extended Supply Chain (This post)
  4. How to Close the Gaps in Your Supply Chain Visibility