Why is this? For starters, the level of risk is growing in the manufacturing supply chain, due to both external (e.g., natural disasters and regional conflicts) and internal (e.g., just-in-time inventory and long lead time) factors. Supply chains are also pressured by the accelerating pace of business and the increasing complexity of a global economy. At the same time, the supply side is increasingly complex due to consolidation and globalization—producing longer lead times and greater volume and types of data to manage. Without sufficient technology and processes in place to handle these challenges, companies will experience a higher rate of errors and difficulty fulfilling orders accurately and on time. To help minimize the incidence of lost or orphaned shipments, organizations should embrace the need for complete traceability, integrate more suppliers, assess and determine their best logistics strategy, and manage remotely through the increased use of mobile technology.
Embracing the need for complete traceability
Because of increased regulation, the pharmaceutical and food/beverage industries are already familiar with the importance of being able to track a part or product from ordering through manufacture and shipping/receipt. The serialization requirements set forth by California 2015 require pharmaceutical companies to develop and implement sophisticated, multi-level package numbering systems for complete traceability to recover lost or stolen product, prevent counterfeits, and expedite recalls.
It is critical for other industries to embrace these tracking measures as well because having complete, real-time visibility and control throughout a product’s lifecycle is increasingly necessary. To be successful in the global economy, organizations must be able to maintain reliable overviews of their manufacturing operations from raw materials to finished-product distribution at all times.
You can implement multiple levels of control to accurately trace products from their origin to destination. As with pharmaceutical and food/beverage packaging, lot and item-level serial tracking enable exact pinpointing of product genealogy, shipment status, and other products in the same shipment in the case of defects or recalls. Automated tracking methods include:
• Radio Frequency Identification (RFID) tags
• Barcode labels (single and 2-D matrix)
• Package Tracking Numbers (PTNs/LPNs)
When these solutions are integrated with compliance labeling and wireless scanning via mobile devices at each point in the chain, the data is sent back to your ERP in real time, creating an auditable history for each manufactured item. You lose valuable employee productivity when unaccounted for products get lost in transit; automated traceability solutions alert you to any shipment problems when they occur. This visibility enables you to take action so that products are delivered on time, to the right customers and with confidence.
Every shipment is an opportunity to gain and retain a customer – this fact is now more important than ever as empowered and informed consumer makes choices based not on brand loyalty but on product quality, service and, increasingly, on social media recommendations. End-to-end traceability is essential to increase your brand reputation and enhance your customer relationships.
Integrating more suppliers
To fully realize complete visibility, you must optimize your collaboration capabilities with suppliers and integrate their data and processes with your ERP and SCM/PLM systems. Having a total traceability solution is not effective if it doesn’t extend from your suppliers through your supply chain and all the way to receipt by the customer.
Some suppliers provide their own package numbering and tracking capabilities, but they must also be able to transmit that information to your system. Three common categories of data integration include B2B/EDI, web portal (cloud), and SFTP. Leading supply chain solution providers will support all major forms of data integration and will also provide the following:
• A single login interface that consolidates data from multiple integration types and points.
• Integrated procure-to-ship-to-pay functionality that supports pre-ship price, quantity, shipping window and carrier/class validation between the supplier and your ERP.
• Support for PTN/LPNs in addition to carrier tracking.
• Rules and workflows that can be configured to specific suppliers and groups.
• Enhanced collaboration capabilities such as comments, notes, attachments, and real-time interactions such as chat.
Integrating the supplier enables you to accurately identify the source of any quality or shipping problems. Onboarding processes that require suppliers to submit certifications or systems that provide supplier analytic data can help you assess problems and implement corrective measures to reduce shipment risks.
In the “new normal” economy, which is cost-efficient, regulated, dynamic, and volatile, empowered customers expect the highest levels of quality and service. Companies must extend accountability measures to suppliers by integrating into a single, automated system with collaboration capabilities.
Assessing and determining the best logistics strategy
Depending on the size of your organization and the reach of your distribution channels, it may be useful to assess your existing logistics model and determine the best approach for your organization. Because global logistics have become increasingly complex, new strategies for managing your distribution network can help reduce lost shipments while meeting your customer service goals. Ask yourself these questions:
1. Are there any logistics functions currently outsourced that can be kept in-house?
Companies that have not historically focused on logistics as a core function are beginning to develop these competencies as a part of a strategy of greater efficiency. Many times, this implementation entails bringing specific functions in-house, such as shipment planning and management. Or, as in the case of an international food and beverage company, it can encompass creating an internal logistics unit tasked with ensuring supplier compliance, sustainability, and alignment with company growth and cost objectives.
2. What logistics execution functions should be outsourced? For example, 3PL providers may continue to be be your best solution for transportation management, or you may want to outsource certain warehousing and storage functions (Vendor Managed Inventory).
3. Can my organization build relationships with third parties to maximize shipping efficiency? Regardless of the location of the logistics functions (in-house or outsourced), leading supply chain organizations have found significant benefits from aligning with key providers and staying up to date with emerging regulations. Leveraging information gleaned from relationships with freight forwarders, customs brokers and other third parties minimizes shipping delays and avoids unnecessary costs.
Once you have a visibility and traceability system in place that is integrated with your entire supply network, streamlining your logistics operations model will further ensure shipment accuracy and competitive speed.
The “final frontier” for following the movement of material throughout your supply chain is the immediacy granted by mobility. Mobile applications are beginning to proliferate across the manufacturing industry, with some estimating nearly 40 percent of manufacturers planning to develop mobile applications in the next year. Solutions providers are also releasing more mobile transaction and reporting capabilities in that time frame.
Mobile devices are already used by warehouse, shipping and transportation personnel to scan and track packages; now email alerts can be sent to decision-makers’ mobile devices, enabling them to respond to view role-based dashboard reports and respond to problems in real time, from anywhere. In combination with cloud applications, this mobile connectivity provides companies with user-friendly access to their information around the clock in a low-cost solution.
The ability to have real-time visibility into what is happening and where – from anywhere – is the single-most critical factor for minimizing the risk of losing any product at any stage of its lifecycle. Determine the technology solutions and internal processes that will work best for your organization and align with core business values to achieve this level of visibility. Finally, you can (mostly) bid farewell to lost shipments and untraceable packages.
As with all operations, the packaging and shipping processes are a combination of technology, automation and human action. Even with the best systems in place, a package can occasionally get lost or even stolen, especially in the consumer retail market. When shipments are accurately tracked from the warehouse to a customer’s doorstep, they can still be reported as lost if they are delivered to a neighbor, who may take several days to return the package. However, once you have taken the steps outlined above, the risks can generally be reduced to these kinds of anomalies.
Source: TAKE Supply Chain
Keywords: supply chain management, supply chain management IT, supply chain solutions, logistics & supply chain, RFID, SaaS, supply chain planning