As supply chains become increasingly complex, the need for end-to-end visibility is more important than ever. By accessing valuable data at each stage of the supply chain, businesses can help ensure higher sales, reduced inventory costs, and speedier, more efficient operations—all while improving the customer experience.
However, connecting a growing number of data streams into a single holistic view can be difficult and time-consuming, especially for businesses dealing with a fragmented supply chain, lack of established networks or inoperability between different systems.
To gain insight into the best ways to enhance data visibility, USPS commissioned proprietary interviews from leading supply chain professionals at small- to medium-sized businesses, getting their expert advice on how to identify areas for improvement and implement the appropriate solutions.[1]
“Supply chain visibility has gone from a poorly understood back-office function to a critical front-office issue, a competitive differentiator, the tip of the spear—something that is seen as driving performance in a delicate, ever-changing environment.”— Former Vice President of Supply Chain, Demand Planning at a multinational consumer electronics retailer
Enhance Visibility at Each Mile of the Supply Chain
See what ten leading supply chain professionals at small- to medium-sized businesses had to say about harnessing data at the first, middle and last mile of the supply chain.
First Mile Supply Chain Visibility
First Mile Challenges: Fragmented Value Chains
During the first stage of a supply chain, inventory arrives from factories or overseas warehouses. At this point, visibility is coming into play at the container level, with products more aggregated at this stage than they are farther down the chain.
Many of the logistics experts interviewed cited fragmented value chains as a common issue the first mile, which can make it challenging—if not impossible—to link relevant data to each step in the flow of goods. Put simply, the more companies involved in a supply chain, the more challenging it is to integrate all of their data. Plus, when each company in the chain is serving one specific purpose, it can be difficult to find a single partner that can meet all of your business’s needs.
Without a global infrastructure or uniform process in place, disconnected data is often the norm rather than the exception. Today’s forward-thinking logistics professionals must find ways to integrate data, allowing for a holistic analysis of the first mile.
First Mile Solutions: WMS, APIs and Streamlining
Depending on your business’s specific needs, there is a range of supply chain solutions available to help enhance visibility at the first mile.
Many of the experts interviewed cited warehouse management systems (WMSs) as a solution to fragmented data. With the ability to be seamlessly integrated into existing warehouse systems and processes, WMSs allow for easy inventory tracking, so you can see exactly where goods are located within the manufacturing line, as well as the estimated timeframe for completion.
This provides valuable data into first-mile processes. For example, if raw materials are not received as expected at a warehouse—or if items are not stored or sorted properly—a WMS can flag this in real time, allowing you to respond quickly in order to avoid delays. There are numerous different WMSs available to meet different goals and needs.
“Automatic storage and retrieval systems can show you inventory of old and new products. But they do not proactively manage inventory day to day. They’re not good visibility tools, and that has led to throughput issues. If people further downstream are not actively monitoring [the chain], this can go unnoticed. Supply chain executives should use new tools and warehouse management systems to manage inventory and flag it when it isn’t moving.”— Former Global Officer and Vice President of Fulfillment Engineering at a multinational retail corporation
More granular logistics data is also available on daily manufacturing output, so it’s easy to identify areas for improvement, pinpoint areas of efficiency and react quickly to any issues or unexpected setbacks.
“You want to understand the shipping schedule of suppliers, the production schedule and whether they’re meeting the plan or slipping behind. The pipeline of Tier 2 and Tier 3 suppliers to the main suppliers can get complicated.”— Executive Director of Global Supply Chain at a multinational automotive corporation
The supply chain experts interviewed also pointed to application programming interfaces (APIs) to help integrate fragmented data at the first mile. Acting as software intermediaries, APIs allow different systems and devices to “communicate” with each other, exchanging and updating data in real time, in order to then “deliver” you the specific information you’re seeking. This allows for quick decision-making as well as a major reduction in the amount of manual data handling required.
“If you have relationships with thousands of vendors, they’re all going to be using different platforms. The challenge, then, is integrating different sets of tools and platforms across the spectrum. The use of API-driven tools has helped. With these, you don’t have to write a lot of code to integrate systems.”— Senior Vice President of Supply Chain at an online luxury fashion retailer
Finally, businesses may also want to look into ways to streamline the number of procurement points, creating fewer potential points of disruption. In some cases, this may mean reducing product selection.
To begin, map out the current procurement process from beginning to end. This will make it easier to identify any redundant stages or areas for automation. Some software solutions will complete each of these steps for you.
Back to Menuarrow_right_altMiddle Mile Supply Chain Visibility
Middle Mile Challenges: Capacity Issues and Delays
The experts interviewed made it clear that the majority of supply chain visibility issues occur at the middle mile.
Capacity issues are common at this stage, which can cause delays at ports—and often throughout the rest of the supply chain, as well. Surges of inbound goods, in particular, can result in issues with inventory management.
Middle Mile Solutions: TMS, 3PL and Control Towers
To obtain better data visibility at the middle stage of the chain, the supply chain experts interviewed focused on a few key methods and technologies, including:
Transportation Management System (TMS)
Sometimes referred to as transportation management solutions, these systems provide enhanced visibility into your fleet, with routing, GPS and real-time truck-movement data made easily accessible. This allows you to see exactly where your product is located.
Key benefits include:
- Ability to track an entire fleet on a single platform
- Real-time visibility into driving conditions and routes
- Real-time, detailed updates for customers about their deliveries
- Detailed reports and supply chain analytics on overall performance
- Better information on trade and tariffs, so you can foresee and plan for disruptions
- Enhanced visibility into trade policies and documentation, resulting in fewer fees and delays
“I think the middle-mile supply chain and transportation deserve more attention. The ability to manage inventory and get deeper visibility can have a profound impact on availability and location, as well as the ability to fulfill orders properly. The middle mile has not had much innovation. Most people are focused on the delivery side.”— Former Senior Vice President of Global Transportation and Logistics at a Fortune 500 retail corporation
With the right TMS, you can increase both the speed and efficiency of middle-mile logistics, streamlining processes for your business while improving transparency for your customers. Many transportation management systems can also be seamlessly integrated with existing enterprise resource planning software.
Working with a Third-Party Provider
Several of the logistics professionals interviewed also discussed working with third-party logistics providers as a way to enhance visibility at the middle mile. Partnering with these professionals allows you to outsource certain elements of your distribution, warehousing and fulfillment processes.
With access to the most sophisticated warehouse and transportation management systems, established 3PLs have the power to provide real-time visibility into this crucial stage of your supply chain—assessing carriers, delays, transportation processes and spend, and more.
With their help identifying inefficiencies, you can gain a closer look at every step, allowing you to act immediately in the event of disruptions or delays and make decisions on the fly. Relying on a trusted 3PL rather than individual vendors also helps ensure that you don’t overpay for services.
Control Towers and Executive Dashboards
The use of supply chain control towers (SCCTs)—cloud-based, agile systems that monitor your transportation and logistics— was also cited as a viable solution for middle-mile issues.
While many large businesses make use of on-premise transportation management systems, cloud-based systems may be better suited to smaller businesses, as they’re typically paid for on a subscription basis, meaning they cost less upfront. They also require less training to get started with and are designed to be scalable, so you can easily scale up as your business grows.
Control towers collect and share data from the various players within a supply chain in order to then present a personalized dashboard of key performance indicators and supply chain events.
Businesses can then better understand, predict and prepare for inefficiencies occurring at the middle mile. The latest control towers can even deliver artificial intelligence-powered insights based on the data collected, allowing businesses to adapt quickly and automate processes as needed.
If your business has the resources in place to explore blockchain technology, you can further boost the efficacy of your control tower. Blockchain is a distributed ledger that allows every party in your network to view a copy of that ledger, which is updated in real time as new transactions and activities occur within the chain. (You can control which parties see what.)
This, in turn, allows all data within the control tower to remain consistent and easily accessible, so you can make decisions in real time. Any changes—whether related to scheduling, routes, new orders or something else—can also be approved or denied automatically based on personalized settings you control.
To see how blockchain can work at every stage of the supply chain, explore the blockchain experience on USPSDelivers.com.
Back to Menuarrow_right_altLast Mile Supply Chain Visibility
Last Mile Challenges: Network Capacity
At the last mile of the supply chain, some businesses may experience network capacity limitations. This caused major problems during the 2020 holiday shipping season, for example, as regional last mile carriers became overwhelmed with a spike in shipments.
Last Mile Solutions: Digital Transformation, Streamlining and Flexibility
To mitigate these issues, the supply chain experts interviewed pointed to the importance of enhancing visibility into product availability and location, allowing for better inventory management.
Tapping into certain digital logistics trends such as the Internet of Things (IoT) can help. By connecting disparate devices and systems, an IoT network provides holistic, real-time data on the movement of products across the supply chain. Not only can this increase efficiencies for your business, but it can also provide your customers with up-to-the-minute information.
“Try to create a pipeline that gives you insight into product inventory levels from thousands of vendors, and maintain visibility across all carrier partners and transportation hubs, and then out to customers. There’s a significant amount of integration needed, and this can come with high costs”— Senior Vice President of Supply Chain at an online luxury fashion retailer
In particular, the professionals interviewed stressed the importance of streamlining the supply chain and identifying any points of integration. This can be achieved by trimming the number of service providers you work with in order to reduce risk. Not only does this help eliminate the headaches involved in keeping track of numerous providers, but it also allows for better visibility into each transaction.
And if you’re at a point where carriers are beginning to struggle, it’s important to maintain as much visibility as possible into each step, letting retailers make their own decisions at the warehouse level regarding whether to turn to other carriers that are performing better. Maintaining this oversight and flexibility will allow you to be proactive in making changes to enhance the customer experience.
Back to Menuarrow_right_altKey Takeaway
Accessing the right data at each stage of the supply chain can be challenging—and for businesses without the proper resources and technologies in place, it can feel daunting figuring out where to start.
By breaking the supply chain down into the first, middle and last mile, you can start finding areas to improve visibility and implement the appropriate processes. In interviews with leading supply chain professionals, several solutions came up consistently: the use of warehouse and transportation management systems, APIs, third-party logistics providers, and supply chain control towers. These, along with general streamlining and increased flexibility, can all help bring your business into the future.
With a thoughtful, multipronged approach to supply chain visibility, you can start turning challenges into opportunities.
Footnotes
keyboard_arrow_down- [1]Daniel Zahler, “Supply Chain and Logistics,” GLG, prepared for USPS, March 2021. arrow_right_alt
