Visibility is a buzzword word that is thrown around supply chain circles that seems to have lost all meaning. While everyone talks about it, it means something different to different people. In the post, I’m going to describe five levels of visibility, ranging from level 1-Low to level 5 high.
To draw a line in the sand, I would say that true visibility is achieved only when the fifth level has been achieved. Supply chain professionals should be on a quest to evolve their processes and technology stack to achieve each successive level of visibility, as each level of achievement represents a dramatic unlocking of value to their organization.
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Visibility Level 1: Where is the shipment?
With each discussion I have with the trade, this seems to be the single biggest articulated challenge that supply chain professionals have. And it is a challenge. For most organizations, they utilize multiple service providers within their supply chain: freight forwarder(s), steamship line(s), air carriers, drayage companies, customs broker(s), and so on.
This visibility challenge, however, is reasonably straightforward. Most service providers know exactly where your shipment is. They have systems that enable you to understand where the shipment is. It is just a lot of work. Each service provider has their own system. It just seems to be a lot of work for an employee to survey each system and look for a status update.
There are several solutions to solving this problem. The first, most obvious, and likely most complicated solution is to attempt to integrate your service providers’ system into your system. This gets geometrically more complicated and expensive with each incremental service provider. But it ultimately solves your problem. You should be able to get automated updates as to the movement of your containers.
The second method of solving this problem is to acquire the services of a solution such as INTTRA, Winweb Connect, or Project44. While each service is slightly different, they aggregate the updates from various services, so integration becomes simpler and less expensive.
Ultimately, answering the question Where is a container? should be reasonably straightforward (if expensive and technologically complex).
Visibility Level 2: Where is the product?
Depending on where you sit within your organization or how your organization operates, you may or may not see this as a challenge. If you are always selling out of inventory, then you likely don’t care where your product is before it gets to the warehouse. All you care about is that it is there or not. Companies that operate this way carry excess inventory (read: operate with high costs) because they don’t have sufficient control over their inbound supply chain to operate with less.
But there are invariably people within your organization that do care about where their product is. Buyers, Sales people, Chief Supply Chain Officers, and often senior executives care about where their product is. They don’t care about the location of a container...they have promised a certain product or set of products to their customers, and they want to understand the location of a product.
This is challenge of a more complex nature, and it is important to understand why your company’s technology infrastructure likely isn’t currently capable of solving this problem.
Look at it this way: your buyer’s buy product. They likely use your Enterprise Resource Planning (ERP) system for this function. Your sales people sell product. They either use the ERP or a Customer Relationship Management (CRM) for this purpose. In either case, they are selling product. But your transportation people ship containers (or airtainers, or boxes, or pallets, etc.). They use a Transport Management System (TMS), and TMS systems manage containers (or airtainers, or boxes…). TMS’s do not typically understand product.
So, you have a big black hole in the middle of your supply chain that looks something like this:
ERP → TMS → ERP
The currently solution is for a buyer to ask a transportation person where their product is. Then, the transportation person will look in their files or excel to find that product and which shipment it is on. Then, they need to go to the tracking system of that service provider to track where the shipment is. Human intervention is your only solution to this challenge.