We're Close to a Crucial Breakthrough for Supply Chain Visibility

2019-09-09 11:36:26

Imagine if you had total, real-time information about the state of your physical and mental health. You’d be walking around with constantly updated data on all your vitals, continual blood analysis, measures for stress, alerted to any early signs of cancer or infections. 

In some ways, we’re not a million miles from this notion — we have full body CT scans, Fitbits that measure how many steps we take, gym monitors that read our heartbeats, and more. But imagine if absolutely everything you wanted to know about your health was available continuously, fully and in real-time. What would you do? 

You’d correct for existing or looming problems. You’d change your habits and your lifestyle to address specific risks and issues. Instead of giving up alcohol or going vegan with the vague hope that it would do some good, you’d know exactly what to target, and rest (relatively) easy about the remainder. 

A similar scenario exists in supply chain visibility. Supply chain activities are more instrumented and measured than ever before. Point of sale data tracks exactly how many black shirts in size medium were sold yesterday, then meshes with inventory management technology to generate demand predictions that then prompt production of more (or less). Quality yields of machines on a factory floor are constantly measured. IoT devices mean equipment and assets can give reports of their well-being like never before. 

We still fall short of the ideal, however, where all the multitudinous moving parts of a supply chain are visible, in detail, all the time, immediately. If we could achieve that, we could make the same smart moves we might make with our health — anticipate a risk here; trim the fat there; shut down an issue before it becomes a problem. Meanwhile, we wouldn’t have to waste time and anxiety monitoring things that were just fine. 

Interesting thought, yes? It’s a wonderful prospect for sure. And, actually, it’s closer to reality than ever before. In fact, it’s closer than you might think.

The current situation is that we have fantastically accurate information available quickly about all sorts of things in the supply chain, but these nodes of data-gathering are like narrowly-focused spotlights on an otherwise dark stage. The bright spots include factories, distribution centers and stores, but it’s much harder to come by good information about goods on the move. When a shipment of those black shirts in medium gets put on a truck or, even more, a ship, things go dark. There are all kinds of discontinuity in the data that’s essential to better managing the supply chain. 

While the information about goods-in-transit does often become available, eventually, historical data only gets you so far. We live in a volatile world, with constantly changing factors that impact the supply chain. What I and my colleagues have strived to achieve is a series of technological capabilities that amounts to a solution allowing supply chain practitioners to see the location, trajectory and history of anything and everything on the move — true, total visibility. 

The technology that allows you to do that — connected devices capable of combining cellular, network and satellite based positioning methodologies — is not especially new; what’s new is that it’s affordable and can operate without an external power source for much longer periods of time than before, using traditional (2G, 3G) networks but also the newly raising connectivity channels like NB-IoT, Sigfox, LoRa Now, you can attach a tracking device costing less than $50 that draws minimal power from a battery to whatever you choose. The device, in turn, feeds a constant stream of information to our platform, similar to blood providing all the indicators of health for your body. With this solution, you can see the location of your goods online, offline and from modality to modality, anywhere, anytime during the entire duration of the journey. Such a continuous flow of information helps to react when a delay happens or an unplanned event arises, notifying the rest of the chain to minimize disruption. For the first time, we are transforming the track and trace visibility requests into a Service.

Say you have a box of toothbrushes made in Brazil, headed for a Walmart in the suburbs of Chicago. We can track that box from the factory to a truck to a boat, back on a truck, to the distribution center and finally the receiving dock at Walmart, at all times and in real time. 

In the past, this was not an attractive proposition, because toothbrushes are a low-margin item (hence an expensive tracker an extravagance), and Walmart wasn’t too fussy about when their toothbrushes turned up. Now, not only are tracking devices affordable for even a lowly item such as a box of toothbrushes; Walmart is dictating tighter and tighter delivery time windows, with fines levied on the supplier if they deliver late or even early. 

In another scenario, the box of toothbrushes is being shipped to a mom-n-pop store in Jakarta and will take the last leg of its journey on a three-wheeler tuk-tuk. In that case, being able to track it in real-time is important so that you can be sure without third-party reporting that you have the right amount of product at the right location, avoiding the need for redundant inventory. 

These are two drastically different examples, both taken from real experience. Both show how having continuous access to the real-time status of your goods, to this high level of exactitude, prevents multiple costs. 

We’re not at nirvana yet, though. The manner in which all this wonderful real-time, all-the-time data is consumed by a human is crucial. At present, much of the available visibility data is found in multiple systems spread all over the enterprise and beyond, in the hands of supply chain partners spread over time zones, languages and continents, and therefore hard to collate. 

Data needs to be digested and used intelligently in one place. It also needs context. It’s useless to know my cholesterol is 200 unless I know what it was last week, and what it should be. By the same token, an inventory management software program might be set to trigger an alert if the product cycle is more than 20 days, but it might well be that anything under 30 is actually okay, or that the right value right now is seven days because it’s peak season. Everything has to be compared to a plan, otherwise all the data in the world is virtually useless. 

What we’re creating, via smart, affordable tracking devices married to the capabilities of an intelligent data platform is a self-healing supply chain. Now, you have the capability to correct, react, and buffer your supply chain, both reactively and proactively. You can increase inventory when demand is higher than planned. You can adjust routes when there’s a strike at a port or a monsoon in a manufacturing location. You can tweak your use of carriers on the fly to respond to fluctuations in trucking capacity. Most importantly of all, you can dampen the volatility in your supply chain by anticipating and responding to the issues that really matter. On top of all this, using historical collected data your planning efficiency is dramatically increasing, reducing those highly expensive buffers that are used to prevent customer dissatisfaction.

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