The benefits of supply chain visibility
April 14, 2022
What is intelligent visibility?
Intelligent visibility is a combination of two types of supply chain visibility: structural visibility and dynamic visibility. Structural visibility provides a snapshot of a company’s operations and includes the capabilities of network mapping, network assessment, risk assessment, and modeling. It answers the question, “What does your supply chain look like?” Dynamic visibility helps companies monitor events in real time and includes a progression of capabilities from monitoring and predicting to prescribing and ultimately acting autonomously. It answers the question, “What’s happening right now?” Supported by analytical techniques and artificial intelligence, intelligent visibility provides a deeper view of the extended supply chain and supply chain operations.
Why is intelligent visibility important?
Intelligent visibility is a cost-effective way to create a more resilient supply chain. And building resilience is at the top of the executive agenda today as companies work to manage ongoing supply chain disruption. By knowing two types of visibility—structural and dynamic—leaders can create intelligent visibility that provides insights into where to invest for the biggest impact in improving resilience. And importantly, our research shows that companies with greater visibility are more likely to maintain revenue, profit, and share price performance during disruption.
How do you build intelligent visibility for resilience?
Building intelligent visibility requires a supply chain strategy that focuses on the really important areas of the business—full visibility across the supply chain isn’t necessary or economically feasible—and harnesses the power of technology. First, a company can’t create a resilient supply chain without the cloud. Structural visibility is a necessary starting point: Every company should, with the help of a supply chain digital twin, have the basics in place. Advanced dynamic visibility should be the target. Predictive visibility and an autonomous supply chain, achieved with a sophisticated supply chain control tower, are the ultimate keys to maximizing resiliency.
How are today’s companies using visibility?
We interviewed 30 leading supply chain executives in our research and found that companies are at different maturity stages of supply chain visibility. Most of the companies researched have an advanced level of structural visibility. They regularly use network mapping, classic risk management and network simulation/optimization/modeling. But executives said structural visibility is often limited to certain suppliers as opposed to their entire supply base. While their structural visibility may be relatively mature, their dynamic visibility capabilities are not. Most of the executives we talked to reported they are strong in the first two stages: monitoring and predicting. Only about 40% said they use data prescriptively. And almost all companies are unable to execute autonomously—which is key to creating a future supply chain that delivers competitive advantage.
The research reveals that most companies are fairly strong in structural visibility but struggle with dynamic visibility, though both are essential.