Supply Chain Visibility 101

Supply Chain Visibility is the capability to have (near) real-time information on the status of supply, demand, inventory, and capacity information across the entire supply chain. Supply Chain Visibility would involve –
• Having real-time visibility into status and location of goods in transit
• Having an accurate and close to real-time data about the demand from all the channels and customers
• Having an accurate information about future deliveries from suppliers
• Knowing accurately how much inventory is in the supply chain, and where exactly it is located
• Having a measure of current and future capacity utilization at manufacturing plants
• Having a visibility into the production status at outsourcers

Although end-to-end visibility of supply chain remains a utopian ideal, it is not always possible to achieve it in practicality. Hence a company needs to prioritize the areas where improving visibility lead to maximum return for the buck. For instance, a Consumer Packaged Goods (CPG) manufacturer might find maximum benefit in getting accurate information about real-time demand from retailers based on Point-of-Sale (POS) data. A component manufacturer might want to get real-time data about status of jobs that it has outsourced to sub-contract manufacturers. A retailer might benefit most by having accurate real-time information of incoming supplies into its Distribution Centers and stores from logistics providers.

Supply Chain Visibility comprises of two distinct features –
• Collaboration of data between supply chain partners providing real-time and accurate information across the supply chain
• Providing real-time event based alerts to supply chain partners that would enable prompt reactions to events & exceptions

A recent study by IBM found that Supply Chain Visibility was rated as the biggest challenge by largest number (70%) of Supply Chain executives across the globe. The study also found different programs being implemented by organizations for improving supply chain visibility. Some of the most common supply chain programs were –
- VMI implementations
- Collaborative planning with suppliers
- Collaborative Planning, Forecasting and Replenishment
- Continuous replenishment of material for customers
- Real-time sharing of inventory and demand data between supply chain partners