The Missing Link: Why Visibility Is Essential to Creating a Resilient Supply Chain

Supply chain visibility allows stakeholders, such as manufacturers, suppliers, distributors, retailers, and customers, to have real-time access to information about the location, quantity, and condition of products in transit. Improved visibility can help reduce supply chain costs, increase efficiency, and enhance customer satisfaction. It can also help mitigate risks associated with supply chain disruptions, such as natural disasters, geopolitical issues, or transportation disruptions.

Supply chain visibility has been the missing link since the shockwaves of 2020 rippled throughout the world and consumers felt the impacts of broad-based supply chain issues.

But what does supply chain visibility mean? It’s generally defined as the trackability of parts, components or products in transit from the manufacturer to their destination—with the goal being to improve and strengthen the supply chain by making data visible, actionable and readily available to all stakeholders, including the customer.

While it’s clear those disruptive events have forced supply chain leaders to reexamine just how resilient their networks are, full visibility remains out of reach for many. Why? The reason boils down to a single word—barriers.

Visibility barriers exist within supply chain processes and between company silos, applications, suppliers and customers. These barriers disrupt the ability to see when an order ships, what was shipped or if there are changes to an order. This often leads to stockouts, customer satisfaction issues and costly fees. It is often difficult to identify the root causes of these issues and prevent them from happening in the future. According to Gartner, 60% of supply chain leaders say their supply chains have been designed for cost efficiency, not resiliency. And since one of the major drivers of resiliency is visibility, you can see where this problem takes root.

Let’s take a closer look at how gaining best-in-class visibility into supply chain gaps can help you achieve the clarity that may seem out of reach.

Enables you to see supply chain issues before they impact revenue

When you’re lacking supply chain visibility, you’re not seeing where orders go after they’re placed. Without visibility, you can’t see everything that’s happening across your supply chain in real-time, including the status of an order, the date for each step in the process as it moves along the timeline, associated documents and potential exceptions. If you don’t have transparency into all of those variables as they happen, problems are bound to occur that will end up costing your business profits and creating unhappy trading partners. Companies we’ve spoken to refer to this as the “black hole.” When you can’t find and explain inbound or outbound documents to trading partners, that’s a problem.

Having visibility will enable you to enter an order or document number and instantly see all the associated documents presented in an easy-to-read format. It should also empower non-technical users to easily view these documents, see their current status and identify important issues down to the line-item level.

Helps improve on-time and accurate order delivery

Real-time visibility into your supply chain means being able to track orders and have detailed insight into what’s in them. It also means having the ability to identify discrepancies between orders (especially if they’ve been changed), shipments and invoices, without having to manually cross-reference data from multiple systems. Having a clear view of your network allows you to see the fill rate and lead time for orders and shipments. Visibility also enables you to reconcile invoices against purchase orders, shipment documentation and receipts to identify quantity and price discrepancies. This is a critical factor when it comes to being proactive and catching problems before they become costly headaches.

69% of consumers “are much less or less likely to shop with a retailer in the future if an item they purchased is not delivered within two days of the date promised.”

If you’re constantly in the dark in terms of knowing if an order has been changed, identifying shortages before an order arrives or tracking an order in real time, then you need a visibility tool. A best-in-class solution will allow you to achieve three- and four-way document matching, which is critical to gaining full visibility. It should also help you correlate all orders with acceptances, ASNs, receiving and the corresponding invoices to ensure what was ordered is what was received before paying an invoice. This will help you increase accuracy, save money and maintain accurate records.

Empowers you to create exception rules to reduce chargebacks, fines and fees

Changes or discrepancies within your documents shouldn’t be a surprise. It is essential to know if a document failed to process, wasn’t received on time or has missing values. If you’re not able to create exception rules to proactively monitor for and receive notifications on irregularities within your documents, then you’re lacking supply chain visibility. A solution should deliver those notifications in app and via email to ensure complete transparency. The exceptions themselves should allow you to view the order and associated documents. By having proactive alerts, you can promote issue accountability and avoid discrepancies before they turn into major headaches.

Manufacturers and distributors spend 8% of all revenue to pay chargebacks from retailers annually. That may not seem like a lot on the surface, but for a company that pulls in $10 million a year, that’s a whopping $800K being paid out to cover chargebacks.

By having full visibility into your supply chain, you’re able to ensure shipments are made on time with 100% accuracy. On the flip side if you’re a retailer, you don’t want to lose visibility into inventory levels once an order is placed. With full visibility, you’re able to see everything that happens after placing an order and know exactly when it will arrive in your warehouse. With that kind of confidence, you no longer have to increase safety stock and excess inventory.

Helps you stay proactive to mitigate disruption and risk

According to the Business Continuity Institute, 72% of suppliers who dealt with a breakdown in their supply chain lacked the full, real-time visibility needed to come up with a fast and simple solution. Achieving a clear view of your network will help you stay proactive when it comes to managing any sort of disruption, which empowers you to prevent delays and save money. Instant, real-time visibility also allows you to be proactive when it comes to monitoring trends, managing key priorities and tracking disruptions within your organization.

Improves customer satisfaction so you can retain business

Whether you’re a supplier or a retailer, you need to be agile and meet shifting customer demands. Having full visibility into your supply chain will help you identify trends, so you can work with your partners to improve performance and ensure you’re meeting their expectations. Full visibility will also allow you to have productive communication with customers because you’ll have the information on hand to answer questions and correct inaccuracies before you are hit with chargebacks or failures to pay on time.

Increasingly, companies realize their need to improve their supply chain analytics. But many still aren’t leveraging the tools they need to achieve visibility. If you’re one of them, know there’s an abundance of benefits waiting to be realized. Syncrofy customers reported the following benefits from investing in visibility:

• Improved customer satisfaction by 65%
• Reduced avoidable fines and fees by 50%
• Spent 55% less time searching for documents
• Reduced revenue leakage by 30%
• Improved ability to see supply chain gaps clearly and be proactive with orders and shipments
• Improved ability to prioritize challenges and solve problems before they occur

When you are ready to improve your supply chain resilience, take these steps to improve visibility:

1. Look for a data visibility platform that works with your existing ERP/EDI applications. You should not have to change your existing investments to add a layer of visibility.
2. Look for solutions that provide full visibility and valuable insights on your supply chain right out of the box. Long integration times are not required with modern tools.
3. Choose solutions that are designed to be used by everyone in your organization, specifically with the non-technical user in mind (so there’s no need for data scientists or database administrators).
4. Learn more about how to extend supply chain visibility investments into a supply chain visibility program that will drive improved financial performance.

The bottom line is your bottom line. With supply chain visibility, you’ll be able to identify, prioritize and solve execution issues before they impact revenue.

By taking the steps outlined above, you can overcome supply chain barriers, find the “missing link” and bring full visibility into your supply chain.

We’re experts in helping companies just like yours respond to supply chain execution problems every day. Click here to learn how we can get you the visibility you need to save money, increase customer satisfaction, and optimize your supply chain.