Analyst Insight: Is it just a buzzword, or is there really something to the notion of visibility? It’s frequently cited as a challenge for supply chains. Yet by breaking down organizational silos and utilizing technology in addition to old-fashioned communications techniques, visibility can unify fragmented supply chains and create new opportunities via data analytics.
Visibility is the topic of countless articles and studies, but what exactly is it? A general definition describes it as “the state of being able to see or be seen” — a description that can also be applied to the world of supply-chain management.
The ability to track shipments has existed for many years, but it has often lagged in terms of timing, and if there was a delivery delay, it was frequently achieved after the fact. Today, tracking can be done in real time, allowing logistics providers and carriers to respond to exceptions more quickly, thus reducing the cost of exceptions, such as vendor delays.
Today, supply-chain visibility extends well beyond tracking. In most organizations, information exists within silos. The sales department has its projections and budget; production its production schedules, and buyers keep data on supplier cost and delivery schedules. The system is designed to serve the purposes of individual departments instead of the entire supply chain. In addition, each supplier and customer maintains its own silos of information, not commonly shared with other supply-chain partners.
It’s no wonder, then, why shippers, logistics providers and carriers continue to rank lack of visibility as high among the pain points of supply chains. It’s also the reason why so many technology providers are focused on providing that capability.
Modern-day technology offerings such as blockchain, artificial intelligence and machine learning all offer some form of visibility solution. But maybe there’s more to achieving true visibility. According to Nina Liu, CEO of cloud-based platform provider Shippabo, visibility can’t be achieved merely by adopting new technology. Instead, she suggests, visibility might be a communication problem. “Real transparency takes businesses and their partners to communicate with each other — that’s what drives transparency,” Liu says.
Point taken. Communication is indeed important, and should be embraced by all supply-chain partners. However, hand-offs from one carrier to the next within a supply chain still remain problematic when it comes to acquiring true visibility.
A survey undertaken earlier this year by Logistics Trends & Insights LLC found nearly half of respondents citing inland tracking as their biggest visibility challenge in the movement of ocean freight. While better communications can help to alleviate this problem, technology offers even bigger benefits. It can reduce final delivery times, offer data to be analyzed for future improvements, and ensure proof of delivery should any questions arise.
Outlook: The outlook for visibility tools will remain strong into 2020, driven by the growing complexity of supply chains and further shifts in the global trading environment. Depending on shippers’ needs, this type of technology, aided by AI and blockchain, could provide the ultimate answer to shippers’ problems. The number of visibility vendors will likely grow as technologies mature and new ones emerge. Study them all in order to pick the right solution.