Not having adequate visibility to your shipments, orders, or products is an ongoing challenge for many companies. You may have very good visibility in some areas of your supply chain, but have poor visibility or blind spots in other areas such as transportation. How do you go about identifying and closing those visibility gaps? How are new technology capabilities helping in this effort? What are the benefits?
Those are just some of the questions I addressed with John Martin, Vice President at MercuryGate, and Brian Thompson, Chief Commercial Officer at SMC3, in a recent episode of Talking Logistics.
Supply Chain Visibility Gaps
I began our discussions by asking John why visibility gaps still persist despite continued focus on this area. John noted that the complexity of supply chain operations is a key factor, especially now that more companies must deal with international shipments such as ocean freight. “But every mode of transportation is complex, and each has its advantages and constraints,” says John. “There are many carriers and interaction points for each mode with a lot of data to share. The key is turning this data into actionable information.”
Brian adds that, “While historically transportation visibility data was passed mainly through EDI transactions, today we have newer technologies like APIs and web services that connect transportation management systems to warehouse and inventory management systems and to providers directly. [The downside] is that it’s now very easy to get overloaded with data when what you really need is the right information to help drive business value. What’s needed is a collaboration hub [that connects trading partners and systems together] to sort through the data from all of these sources and provide the information to better manage end-to-end supply chains.”
Transportation Visibility Challenges
Since most companies use multiple modes of transportation, I asked Brian if there were differing visibility challenges between modes. He notes that, “For ocean shipping you primarily want to know when it left port and you can predict when the shipment will arrive. Similarly, truckload shipments are point to point. But less-than-truckload (LTL) shipping is much more complex, with multiple pickups, pool points, and deliveries. From all of this complex data what you want is information that is real-time, accurate, and actionable. But not all modes or carriers are at the same maturity level with APIs and web services. Therefore, integrating to multiple carriers can be difficult. There are partners out there that didn’t exist a few years ago that can build and maintain those integrations for you and standardize the messaging back to you.”
John adds that the visibility challenges get even more complex when you deal with international shipments. “Each country has its own policies, geography issues, taxing structures, and population densities. You need a system that can model your unique transportation situation and constraints before you consider visibility.”
Closing the Gap
In order to close the gap in visibility, Brian says to start with your goals. He points out that, “Visibility itself is not the goal, it’s driving value. It may be getting goods to market faster or hitting ever tighter retailer delivery windows or making sure your product is on the shelves at the right time. Whatever your goals are, assess your ability to meet those goals.”
John summarizes the requirements succinctly: “Does the system meet your current and future needs for all necessary modes of transportation? Does it interface well with other systems and can you easily add future interfaces? And most importantly, does the system accommodate your business process? If I get this foundation right, I’m starting in a good place for all of the other details.”
From a technology standpoint, John says, “Control Tower, multi-mode SaaS technology and integration capabilities are table stakes. It’s not a matter of if you need these technologies, but when.”
Brian concurs and says, “Control Tower visibility, with the necessary analytics behind it, is critical in driving business insights and actionable information.”
Driving Value
I asked John and Brian to share some examples of how their customers have driven real value from transportation visibility. From one customer who cut their outbound freight spend in half to another who achieved over four times their expected inbound freight cost reduction to yet another who reduced their labor hours by 20 percent, John and Brian provided some great examples.
For more details on these customer examples and other insights on supply chain visibility, I encourage you to watch the full episode. Then post a question or comment and share your perspective on this topic!
