Supply Chain Visibility
From Merely Tracking to Driving Change
Global Logistics & Supply Chain Strategies | January 18, 2008
Analyst Insight
Despite heightened attention in recent years, many companies still lack timely visibility into critical processes involved in global supply chain management. This can make it impossible to access information quickly enough to be useful for making key decisions. Further, even companies that do track enough milestones often suffer from poor data quality and factual inaccuracies in forecasts and reports. For those that track the key supply chain events and have advanced visibility strategies to support supply chain decision-making, it is critical not to overwhelm internal stakeholders with information but to instead provide them with the tools to extract the best possible intelligence from the data they have – while keeping the amounts of data manageable. Companies must move from merely tracking their supply chain events to performing advanced analysis in order to drive profound changes in their supply chains.
—Viktoriya Sadlovska, research analyst at Aberdeen Group
In a recent study on global supply chain visibility, Aberdeen Group benchmarked 225 companies with global supply chains.
Best-in-Class companies in this study are one and a half times as likely as Industry Average and almost three times as likely as Laggards to report that data received during their event monitoring process are accurate more than 80 percent of the time. After investigating this issue, the following differences were uncovered in the kinds of software tools/services used to collect the data:
• Companies that reported that their visibility software has event tracking capability are 70 percent more likely to report data quality of 80 percent or more
• Companies that reported that their visibility software has a data management service available are 60 percent more likely to report data accuracy of 80 percent or more, and three times as likely to report data accuracy of more than 90 percent
• Companies that reported that their visibility software enables collaboration/relationship management are 50 percent more likely to report data quality of 80 percent or more.
Best-in-Class companies are much more likely to perform a wide variety of data analysis in support of supply chain decision-making—which ensures that the collected visibility data are used to help them achieve a market advantage. They are also 55 percent more likely than all others to be using some kind of automated visibility data analysis tool.
The Outlook
Visibility Strategy. Developing a strategy for global supply chain visibility should be a key component of the long-term strategy for the global supply chain. Although tracking supply chain events is essential, the long-term goal should be to turn visibility information into a competitive asset by analyzing it to uncover trends, root causes of problems, understand cost accrual along the supply chain, and enable timely response to supply chain disruptions. In doing this, it is critical to ensure that the data used for analysis is accurate and complete and that the appropriate analytical tools have been put in place.
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