Communicating across the inbound supply chain is more complex than ever. Supply chains are more global, involve more parties, and goods move across more modes of transport
Top 3 contributing factors for poor supply chain management & visibility are:
- Limited Information Flow: With little-unified information exchange, data flow is inconsistent across highly fragmented networks of trading partners, carriers, and logistics service providers. In many cases, collaboration is often reactive, or action is only taken when a problem occurs.
- Constrained Insights: With no ability to easily locate freight in-transit or to predict Estimated Time of Arrivals (ETAs), there is a limited capability to easily track the status of purchase orders, containers, shipment statuses, and/or the location of goods. In many scenarios, it can be challenging to manage inventory, gauge production, and service customers.
- Narrow Scope of Efficiency: With manual collaboration between trading partners via email and spreadsheets, processes are slow, and data is error-prone. In many cases, a lack of automation and business rules ultimately results in higher operating costs, an inability to evaluate supplier performance, and missed opportunities.
Add to this mix escalating end-consumer expectations (i.e. the Amazon-effect) and shrinking supplier delivery windows, and the challenge is greater than ever to stay cash positive.
The Foundation of Inbound Supply Chain Visibility: Integration and Collaboration
While it may be tempting to say that the above challenges can be solved through simple business-to-business (B2B) integration, better logistics management does not stem from information and integration alone. Nor does the answer lie in simply connecting people and businesses. It is only by bringing together integration (data) with collaboration (people and businesses) that the term ‘visibility’ can be applied.
- Integration: At a fundamental level, streaming accurate and current data between trading partner systems is essential. This means connecting businesses of all sizes and at every level of technical sophistication regardless of message type, format or unique processes. Usually, integration can be achieved by EDI, web portals, API, or other protocols. Status messages are generated at key milestones from the order cycle, to finance, transportation/logistics management, warehouse fulfillment, manufacturing/material handling, customs, to industry-specific stages or requirements.
- Collaboration: To truly optimize the inbound supply chain and better manage trading partners, it is also critical to add-in effective collaborative communication. This means marrying the raw information and milestone data with business- or industry-specific rules, processes, and people.
Here’s one practical example of inbound supply chain visibility in action: Instead of a paper-based invoice, an automated workflow collects an electronic invoice from suppliers and carriers in any format. A solution then transforms the invoice to the correct configuration to match a given ERP or system, applies applicable business rules, and validates the invoice and data. Should an error occur, an alert is automatically communicated to the appropriate trading partner, the issue is corrected, and eliminated going forward.
With the right level of inbound supply chain visibility in place, businesses a can also automatically:
- Perform mass communications to appropriate segments of the trading partner base without relying on emails or out-of-date spreadsheets
- Collaborate on performance-related issues that help resolve discrepancies with full traceability and audit control
- Empower business partners to standardize processes while maintaining internal standards
- And more
Register to view an on-demand web seminar that explores the above in more detail as well key industry statistics, benefits, best practices, case studies, infographics, techniques to incorporate inbound supply chain visibility in your organization, and more.