It’s the ultimate goal, to reap maximum efficiencies and respond swiftly to change. But with complex and morphing networks it may be harder to achieve than thought.
“There’s no need to see your entire inventory, just track the movements” – Matthew Lock, senior consultant at Bis Henderson
“Total supply chain visibility is possible, but so far we’ve been hampered by the way reporting has been done. In the past, people have been fixated with producing reports on static data, which really only tells you about what happened yesterday and then predicts the future based on that. When you do that, you are really starting the process when it’s finished.
In supply chains we have discrete systems that pass on minimal information from one to the next. Again, that tells us about what has happened and not what is happening right now. We should be doing things differently, using the new technologies available that make dataflow connectivity available, and actually utilise the skills and knowledge we have within supply chain businesses to connect data sources.
It needn’t be that complicated. When we talk about supply chain visibility, we are really talking about inventory visibility at different points along the supply chain. Say you have 120,000 stock keeping units (SKUs) moving about – tracking them sounds hard, and some people think this requires a huge ‘big data’ operation to do it, but it doesn’t.
In reality you’re asking: ‘how many SKUs do I need to manage at each point along the supply chain?’, and then you track the number of units moving every hour, minute, second or millisecond. You don’t need to take a snapshot of where your entire inventory is, you just track the movements. Once you know where every SKU is, you have total supply chain visibility. You are stitching together lots of small packets of information, which together give you massive insight. All you need is a connection to the internet, because you are using cloud-based reporting.
We are all used to fast delivery in our lives as consumers. It is inevitable that businesses will start demanding the same level of visibility.”
“Some see it as the micromanagement of people, not improvement” - Charles Hogg, commercial director at Unsworth
“It’s almost starting to feel like this utopian dream. I think our expectations are driven by what you can get in the commerce world, the Amazon or the DPD experience, where you can see your delivery sequence.
But that has not really translated into the real-time information on a container load of retailer goods from China through to the distribution centre.
There is a lot of private equity money floating around to try to achieve that level of visibility, real-time forecasting and push notifications, but we are not there yet.
Why not? There are a lot of legacy systems around. Although the technology might well exist, some hauliers don’t see it in terms of improving customer experience but a way of micromanaging people, so they are a bit scared of pushing things down that track. We have a shortage of lorry drivers, and the hauliers don’t want to alienate the ones they have, so they are not pushing for the technology.
Also, it is hard. You can pick up a lot of data points when you are moving cargo from China to a distribution centre in the UK. The issue is picking out information that’s useful, what is appropriate to report on, and how that benefits the freight forwarder. Sometimes this is framed as giving the customer power, but maybe it would be more appealing to say that it is about giving the customer confidence, especially in this quite turbulent period.
Over the next few years, we plan to use analytics, AI and other technology, but none of that works on its own. You need human intelligence to understand how to use the data. Also, at the moment a lot of customers don’t believe that more nuanced data really helps their businesses. Until they see the value of real-time data in terms of how it helps their warehousing planning, for instance, we will never achieve full supply chain visibility.”