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 get the most out of supply chain visibility, it’s crucial to identify the specific type of visibility your business needs. Moreover, “Rome was not built in a day”, so identify exactly which type of visibility you need, and build it one IT project at a time. By doing so, you can avoid overly complex projects that yield little insight. In this article, I’ll share with you seven types of supply chain visibility and how they can be tailored to different business needs, helping you achieve the visibility that matters most to your organization.

1. Transportation Visibility: “Where’s 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 primarily use transportation visibility tools. With tracking technology, they can receive updates on a shipment’s progress and estimated time of arrival. For example, let’s take real-time tracking of cargo, such as the GPS location of a shipping container. Here, a supply chain manager can anticipate its arrival and manage their operations more effectively.

Now, supply chain managers need to balance the level of tracking with the costs to track. For instance, GPS real-time tracking is expensive. However, 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. For most tracking use cases, periodic tracking such as every couple of hours or once a day is most cost effective and best value. For more information on the latest tracking technologies, see my article, 10 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: Ten 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

For instance, descriptive analytics can provide shipment visibility to measure performance and identify anomalies requiring corrective action. This type of analytics does this by extracting and interpreting data during each stage 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. Indeed, using metric assessment tools, businesses can understand their shipping operations better. As a result, this enables them to make data-driven decisions that boost efficiency, cut costs, and enhance service levels. Also, focusing on this type of 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 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 on-demand rate visibility, a business can use rate comparisons to select the lowest-cost carrier for a given transportation lane. With this type of visibility, 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 if a business uses carrier contracts versus spot rates.

Without a doubt, carrier rate visibility helps businesses for planning and negotiating carrier contracts. Specifically, shippers need visibility into transportation rates, including historical trends and future projections. This enables shippers to 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 transportation budget. So, rate visibility can yield significant 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 peak season. Thus, it can ensure that inventory levels are sufficient to meet customer demand. Indeed, this type of visibility holds much promise in helping companies stay agile and responsive to market changes, As a result, supply chain visibility and good planning minimizes the impact of demand fluctuations. For more tips on using data analytics for supply chain planning, 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. Supply Chain Operational Visibility: Proactively Manage Current Operations.

The Need to Rapidly Know the Impact of Likely Exceptions, to Prioritize Information Gathering, to Identify mitigation strategies, and Make Assessment on What to Do.

Reactive Shipment Tracking Vs Proactive Operational Visibility: Here Is How To Best Overcome Supply Chain Exceptions

In today’s complex and dynamic supply chain landscape, proactive operational visibility is crucial for identifying and addressing exceptions before they escalate into major issues. Traditional reactive approaches such as just tracking shipments fall short, leading to delayed responses and increased costs. By adopting a proactive approach, organizations can enhance their supply chain resilience, improve customer satisfaction, and drive business success. In fact, there are several critical capabilities needed for operational visibility. First, this includes being able to rapidly prioritize and focus on the right problem. Also, supply chains need to aggressively use data analytics to swiftly close information gaps for agile decision-making. Lastly, operational visibility needs the capability to do speedy situational assessments based on time and information available.

To illustrate proactive operational visibility, a manufacturer might use real-time data analytics to anticipate a potential delay in raw material shipments due to weather conditions. By quickly assessing the impact of this delay on their production schedule, they can prioritize information gathering to understand the severity of the delay. From there they can leverage advanced technology to help identify alternative suppliers or adjust their production plans accordingly. In another example, a retailer might use predictive analytics to forecast demand fluctuations and adjust their inventory levels and supply chain operations to meet changing customer needs. For more on operational visibility, see my article, Reactive Shipment Tracking Vs Proactive Operational Visibility: Here Is How To Best Overcome Supply Chain Exceptions.

7. 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. Specifically, it provides 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 just 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 different types of supply chain visibility, see below:

• GEP’s article, Real-Time Visibility for Maximum Supply Chain Performance
• Vizion’s article, What are the Types of Supply Chain Visibility Software, Applications & Technology to Consider?
• NetSuite’s article, What Is Supply Chain Visibility (SCV)? Definition & Examples
• SC Tech Insights’ 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

Need help with an innovative solution to make your supply chain analytics actionable? I’m Randy McClure, and I’ve spent many years solving data analytics and visibility problems. As a supply chain tech advisor, I’ve implemented hundreds of successful projects across all transportation modes, working with the data of thousands of shippers, carriers, and 3rd party logistics (3PL) providers. I specialize in proof-of-concept and operational pilot projects using emerging technologies and methodologies. If you’re ready to supercharge your analytics or if you are a solution provider, let’s talk. To reach me, click here to access my contact form or you can find me on LinkedIn.

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