The complexity and interconnectivity of global markets have heightened the importance of supply chain visibility, making it essential for informed business decision-making. However, businesses can easily become overwhelmed by both the volume of data and the costs associated with pursuing total visibility. Additionally, supply chain visibility is not simply a software solution you can purchase off-the-shelf. Indeed, supply chain visibility is not a one-size-fits-all solution. This is because there are different types of visibility, each providing insights into various parts of the supply chain.

So to achieve supply chain visibility, businesses need to be laser-focused and take an incremental approach by tackling it one IT project at a time. Moreover, it is essential for companies to identify and choose the appropriate technical solution for each IT project in order to meet their critical visibility requirements. Lastly, this means zeroing in on the right type of visibility that avoids unwieldy projects that provide little insight. In this article, I’ll look at six types of supply chain visibility and how they fit different business needs.

1. Transportation Visibility: Find My Stuff.

The Need To Know Where Cargo Is And When It Will Arrive.

So, for this type of visibility, logistics managers and end-customers use transportation visibility tools. With tracking technology, they can receive updates on a shipment’s progress and estimated time of arrival. For example, by having real-time tracking of cargo, such as the GPS location of a shipping container, a supply chain manager can anticipate its arrival and manage their operations more effectively.

Even though this level of tracking can be expensive, it enables swift action in case of delays, diversions, or unexpected events. Thus, this ensures that stakeholders are always informed about the whereabouts of their cargo and shipments arrive on-time. At the same time, achieving this level of tracking granularity across the entire supply chain is an expensive proposition. For more information on the latest tracking technologies, see my article, 9 Logistics Tracking Technology Trends: The Best Tech For Better Visibility And Traceability.

2. Capacity Visibility: Identify Choke Points in the Supply Chain.

The Need To Know Where the Choke Points And Critical Paths Are In the Supply Chain.

Decision Intelligence Tech To Empower Logistics: The Ways These New Analytic Practices Are Better

Capacity visibility provides insights into the utilization of resources within the supply chain. Thus, this helps businesses to spot bottlenecks that could lead to inefficiencies. For instance, capacity visibility is critical at a port to proactively monitor crane availability to assure cargo offloading is both efficient and not delayed. In another example, a supply chain analyst can monitor warehouse space. As a result, they discover that a particular facility routinely reaches capacity, causing delays in shipping. With this knowledge, management can take steps to redistribute inventory or expand resources.

In addition, there is an emerging, AI-powered technology that goes hand-in-hand with capacity visibility. It is called Decision Intelligence. For more information, see my article, Decision Intelligence Tech To Empower Logistics: The Ways This New Automation Is Better.

3. Shipment Data Analytics Visibility: Measure Performance.

The Need To Know How the Supply Chain Is Performing Using KPIs And Audits.

Data Analytics You’ll Need For Unsurpassed Carrier Delivery Results

Shipment data analytics visibility focuses on the extraction and interpretation of data from various stages of the shipping process. For instance, this can include examining delivery times and frequency of delays continuously over time. As a result, this helps managers refine supply chain’s performance using key performance indicators (KPIs). Further, Shipment data analytics helps measure environmental, social, and governance (ESG) goals and ensure compliance with regulations.

Also, data analytics can help supply chain analysts identify reliable carriers and improve customer satisfaction by measuring on-time delivery rates. Using metric assessment tools, businesses can understand their shipping operations better, enabling them to make data-driven decisions that boost efficiency, cut costs, and enhance service levels. Focusing on this visibility allows continuous improvement of shipping processes using performance metrics. On the other hand, real-time data collection isn’t usually necessary for this type of supply chain visibility. Further, data data collection should be targeted to avoid data overload and extra expenses. For more discussion on shipment analytics, see my article, Data Analytics You’ll Need For Unsurpassed Carrier Delivery Results.

4. Rates Visibility: Manage Transportation Spend.

The Need To Know Transportation Rates, Both Historical And Future, For Cost-Benefit Analyses And Spend Management.

The Best Ways To Make Your Freight Bill Audit Process Better Benefit Your Shipping Operations

Rates visibility entails having access to comprehensive pricing information across different carriers and shipping options. For real-time rate visibility, a business can use rate comparisons to select the lowest-cost carrier for a given transportation lane. With this real-time capability, a company can use a mix of reliable carriers for a given route to minimize costs while maintaining service levels. At the same time, real-time ratings may not be cost-effective, nor be needed depending on the needs of the business.

Also, carrier rate visibility helps businesses for planning and negotiating carrier contracts. This is a case, where real-time rating is not needed. What’s most important is that by having visibility into transportation rates, including historical trends and future projections, shippers can make informed decisions about their transportation networks. For instance, a business might analyze past freight costs against current rate quotes. Based on this rate visibility, they can negotiate better terms with carriers and optimize their shipping budget. So, rate visibility can yield immediate financial benefits and provide a competitive edge through strategic cost management. For more tips on gaining rates visibility, see my article, The Best Ways To Make Your Freight Bill Audit Process Better Benefit Your Shipping Operations.

5. Supply Chain Planning Visibility: Prepare for Future Operations.

The Need To Know Future Demand, Future Supply, Inventory Levels Required And Assets Needed.

Supply chain planning visibility involves the ability to forecast demand and plan resource allocation effectively. By integrating data from sales, operations, and external sources, businesses can anticipate market trends and adjust their supply chain strategies accordingly. Again this is a case, where targeted data collection may be more cost effective and avoid data overload.

Predictive analytics is a key component of supply chain planning visibility. Indeed, it can signal the need to ramp up production ahead of a peak season, ensuring that inventory levels are sufficient to meet customer demand. Emphasizing this visibility aspect helps companies stay agile and responsive to market changes, Thus, supply chain visibility and good planning minimizes the impact of demand fluctuations. For more tips on using data analytics for supply chain visibility, see my article, Supply Chain Planning: Data Analytics Advice That Will Result In A Better Way.

Supply Chain Planning: Data Analytics Advice That Will Result In A Better Way

6. Strategic Supply Chain Visibility: Innovate And Optimize Processes.

The Need To Know What Can Be Done To Improve Supply Chain Processes To Assure Future Success.

The Way of Digital Transformation: A Business First, High Tech Reinvention 0f Processes and Culture

Strategic supply chain visibility transcends operational visibility to include insights that drive long-term improvements and innovation. Through a holistic view that encompasses suppliers, internal processes, and customer feedback, businesses can identify systemic issues and opportunities for process re-engineering. For instance, this might involve re-configuring the supply network for improved sustainability or adopting new technologies to streamline operations.

Focusing on strategic visibility fosters a culture of continuous improvement. Moreover, a strategic viewpoint positions the business for long-term success in a competitive landscape. At the same time, businesses need to weigh their options on whether they need a full-blown “Digital Twin” or targeted data collections focused on executive-level decision-making. Indeed in this age of digital transformation, businesses need to be laser-focused on identifying their information requirements, and not be overwhelmed by data that provide little insights. For more ideas on digital transformation, see my article, The Way Of Digital Transformation: A Business First, High Tech Reinvention Of Processes And Culture.

More References.

For more discussion and references on types of supply chain visibility, see GEP’s Real-Time Visibility for Maximum Supply Chain Performance, Vizion’s What are the Types of Supply Chain Visibility Software, Applications & Technology to Consider?, and NetSuite’s What Is Supply Chain Visibility (SCV)? Definition & Examples. Also, see my article, Supply Chain Visibility Of Cargo: Know Your Need And The Surprising Challenge To Secure It.

Supply Chain Visibility Of Cargo: Know Your Need And The Surprising Challenge To Secure It

For more from SC Tech Insights, see the latest on these topics, Data, Supply Chain, and Decision Science.