Transform your supply chain with enhanced visibility. Optimize inventory, boost supplier collaboration, improve order accuracy, and reduce operational costs.

Romain Fayolle

The last few years have seen many investments in supply chain management solutions, from planning systems to logistics optimization tools. These solutions promise and aim to create speed, accuracy, and visibility in the company’s end-to-end supply chain. For companies, this translates to optimized operations, lower costs, and distinction in the competition.

But somehow, after spending so much money, resources, and effort, these systems still feel siloed. Despite having systems specialized for different segments of supply chain management, sharing information requires someone to download data and then upload it to the next system. Sometimes, reports are not what the leadership wants, causing hindrances to creating true end-to-end visibility.

Modern supply chain management requires enhanced visibility. Transparent supply chains help managers make better, data-driven decisions, sense and react to risks early, increase customer satisfaction, and streamline operations.

This article discusses how companies can leverage improved visibility to drive innovation in their supply chains. It analyzes where visibility can unlock business value and offers best practices for implementing solutions.

What does Enhanced Visibility Mean for Supply Chain Management?

*Transforming Supply Chain Management with Enhanced Visibility*

Enhanced visibility in supply chains refers to the real-time tracking and information sharing of all supply chain transactions and statuses, like inventory or order status, and transactions at different stages from procurement through delivery. It enables businesses to gather and analyze data from various stages of supply chain management, which can be used to build valuable insights into performance, risks, and improvement areas over time.

The tangible areas of the supply chain that are impacted and improved by enhanced visibility include:

Efficient Inventory Management: Inventory is where real capital sits as goods. Improving inventory management improves the company's cash flow and lowers the obsoletion risk. Real-time visibility allows companies to maintain the right stock levels, lowering excess inventory and improving service by reducing stockouts.
Improved Order Fulfillment: By sharing accurate order data with key suppliers and other supply chain partners, companies can ensure that the orders are properly tracked, prioritized, and processed (for example, following the FIFO correctly), which improves customer delivery timelines.
Stronger Supplier Collaboration: Enhanced visibility and information sharing with suppliers and other partners promote better communication and trust in the whole system. This becomes possible as the suppliers can better align their operations with company plan changes. Such visibility also helps optimize procurement costs.
Lower Operational Costs: With enhanced visibility, supply chain teams can identify non-value-adding (NVA) activities faster. By identifying such inefficiencies quickly, they can implement corrective measures to reduce waste and improve the cost.

How Enhanced Visibility Drives Better Supply Chain Performance

Enhanced visibility through technology not only helps in managing inventory levels and supplier relationships but also in anticipating and mitigating risks, ultimately leading to a more resilient and efficient supply chain. We will now examine these impacts further and discuss how you can gain high visibility into your supply chain.

Demand forecasting plays a crucial role in leveraging this enhanced visibility to predict future customer needs and optimize inventory levels.

1. Efficient Inventory Management with Enhanced Visibility

For many businesses, inventory represents one of the largest share of costs in the supply chain. Along with the cost of carrying the inventory and obsoletion, there is a constant opportunity cost against the cash flow impact due to the high inventory. On the flip side, if the inventory cover is insufficient, it can severely and quickly impact the service and customer's confidence in the brand.

Enhanced visibility helps companies manage inventory more efficiently by providing real-time insights into stock level changes, product locations, production outlook, and demand trends. This means that the company can target more optimized inventory levels, have less money tied up in excess inventory, and have a reduced risk of stockouts.

Optimizing Inventory with Enhanced Visibility

Implement Digital Inventory Tracking: Digital inventory tracking through modern sensors, QR codes, RFID tags, and other modern solutions can help monitor inventory as it moves through the supply chain. This allows companies to be aware of the exact location of items and monitor conditions like temperature for sensitive goods. This visibility is particularly helpful for the RM and other child items, as any shortfall for these can suddenly derail the production plan and finished goods (FG) inventory cover.
Just-In-Time (JIT) Inventory Management: With real-time insights and enhanced visibility, companies can implement JIT practices with their supplier partners to minimize carrying costs while ensuring that smaller quantities are made available at regular intervals.

2. Improved Order Accuracy and Fulfillment

Order processing errors are the fastest way to dissatisfied customers and higher fulfillment costs. With enhanced visibility, both supply chain teams and customers can access real-time information on order fulfillment, available-to-promise (ATP) inventory, shipment tracking, and estimated time of arrival (ETA). All this keeps customers informed on their orders and delivers them promptly and accurately.

Improving Order Accuracy with Enhanced Visibility:

Integrate Order Management Systems (OMS) with Other Platforms: Connecting your OMS to other platforms, such as planning systems, warehouse management systems (WMS), or transportation management systems (TMS), helps provide end-to-end tracking from order placement to delivery. This helps keep customers informed and allows for proactive resolution of delays.
Automate Notifications: Setting up automated notifications that give customers regular updates on order status, tracking details, and ETA enhances visibility. This builds trust in the long term and reduces customer service-related inquiries.

3. Stronger Supplier Collaboration

Strong supplier collaboration behaves like a strong backbone for the business. Enhanced visibility in this area supports transparent data sharing on critical supply chain metrics like inventory levels, order forecasts, delays, cost escalations, and even potential disruptions, which directly impact supplier performance. Sharing such information regularly over the longer term fosters stronger partnerships, improves reliability, and enables better contingency planning. With high trust in the ecosystem, companies and their suppliers can realize better margins and lower costs due to reduced wastages, lower reworks, and lesser expedited operations.

Building Stronger Supplier Collaboration with Enhanced Visibility:

Build and Utilize Supplier Portals: Provide suppliers with access to portals where they can monitor relevant data, such as demand forecasts, PO status and delays, inventory levels, and even payment status against past POs. This encourages better alignment and responsiveness.
Implement and Share Scorecards of Supplier Performance: Supplier scorecards can track key metrics such as lead times, delivery accuracy, and quality. Sharing this data with suppliers can motivate them to meet performance standards and improve reliability. Create incentives for supplier partners to improve their service. Recognize and reward them for any tangible improvement they demonstrate.
Collaborative Demand Planning with Suppliers: Share demand forecasts and planned order volumes with critical suppliers to help them prepare for demand surges or seasonal changes. This collaborative approach minimizes stockouts and delays substantially.

4. Lower Operational Costs with Visibility-Driven Efficiency Gains

One of the most compelling reasons to enhance visibility is its potential for cost savings and to optimize business costs. With enhanced visibility, identifying inefficiencies and then making data-led decisions can help companies reduce waste, optimize resource allocation, and achieve more efficient operations. The best part is that the opportunity lies across the different parts of the supply chain, from manufacturing to distribution.

Leaders should set cost targets for their teams with all the visibility initiatives in the organization and track them as a part of their S&OP cadence.

Cost-Reduction Strategies with Enhanced Visibility:

Optimize Freight and Transportation Costs: Real-time visibility into transportation routes and vehicle locations enables companies to optimize resource allocation, optimize routes, consolidate shipments, and select cost-effective carriers.
Implement Target-based Lean Practices: Enhanced visibility allows companies to adopt lean practices across the supply chain, especially in manufacturing and inventory management. This reduces costs while meeting demand in a more agile way.
Identify and Eliminate Non-Value-Adding Activities (NVAs): Use visibility data to identify inefficiencies, such as redundant processes or excessive handling, that drive up costs. Eliminating NVAs boosts productivity and reduces overhead expenses. Gather ideas and opinions from the workforce on the ground, like associates on the production line, to understand what the NVAs are in their part of the supply chain. Work on those ideas with them to eliminate or reduce these NVAs.

Transforming Supply Chain Management with Holocene's Enhanced Visibility Solutions

Enhanced visibility is an innovative data-led approach that reimagines supply chains, allowing stakeholders to make data-driven decisions, anticipate market changes, and respond swiftly to customer demand. Visibility brings value to supply chain management by reducing inventory, improving order accuracy, coordinating with suppliers, and reducing costs.

Holocene recognizes the strategic value of visibility and provides customized solutions for each client. By leveraging Artificial intelligence (AI) and machine learning (ML), Holocene provides an edge by enabling you to analyze data, predict demand, and optimize inventory levels — turning visibility from a lagging indicator to a success factor.

Holocene helps you to build a competitively strong, sustainable, and supply chain focused on the end consumer. Contact us today to learn more about how we can assist you in optimizing your supply chain for visibility.

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