How to Improve Supply Chain Visibility

Updated on July 26, 2024 by Mark Michaud

Logistics manager assessing supply chain visibility and process at shipyard.

An ideal supply chain is a seamless flow of goods that runs smoothly between your various locations and to your customers.

Disruption is minimized, punctuality is maximized, and cost-effectiveness is optimized. Sounds great, right?

You may think you already have this, but without a comprehensive overview of your supply chain operations, how can you be sure? There could be enormous inefficiencies hamstringing your productivity and curtailing your revenue.

Without full supply chain visibility, both these issues and opportunities for improvement could go completely overlooked.

And this issue is more common than you might think. Only 6% of companies report having full visibility over their entire supply chain, and 69% believe their level of visibility is so low as to be a risk to their reputations.

The level of risk created by this uncertainty is a huge problem for businesses, especially in the current economic climate. In this article we’ll explore what makes supply chain visibility important, and how you can improve supply chain visibility to maximize productivity and profitability with a few instrumental additions.

What do we mean by “supply chain visibility”?

Supply chain visibility (or SCV) can describe both:

The visibility of freight and product: The location of products and the efficiency of the supply chain. This includes aspects such as on-time performance (OTP), product locations and overall efficiency. Software is used to provide real-time data and generate reports that offer insights into product visibility.

Efficiency and cost visibility: This type of visibility focuses on optimizing the selection of carriers and modes to ensure efficiency and cost-effectiveness. It addresses questions related to carrier selection, mode optimization (e.g., truckload vs. less than truckload) and choosing the most cost-effective options. The importance of tracking costs on a daily, weekly and lane-by-lane basis is highlighted, especially for CFOs and senior leaders concerned with the financial elements of the supply chain.

For the purposes of this article, we will be talking about both types.

Why supply chain visibility matters

A highly visible supply chain provides a large amount of data relating to your operations and efficiencies, such as:

Real-time shipment location
Freight cost and comparative freight costs
Carrier rates
Transportation routes
Shipment delays
Inventory levels

When analyzed, this data makes it possible to identify multiple opportunities for alterations and optimizations of the logistics process. These changes can greatly benefit the efficiency, effectiveness and resilience of your business in several ways:

More efficient staffing allocation: Real-time visibility of deliveries and their timing allows you to ensure your warehouses and distribution centers are suitably staffed to take deliveries and load shipments. The rest of the time (i.e. dates and times where no deliveries are expected) they can be kept on a skeleton crew, reducing unnecessary expenditure on labor.

Route optimization: Just because a route has been reliable for years does not mean there is no scope for improvement. With the data produced by increased visibility, you can compare and contrast routes to streamline your supply chains and reduce costs.

Carrier selection: Greater visibility allows you to view all the carriers available for a particular route, with the ability to compare and contrast them on cost and timelines.

Mode of shipping: Just because you are moving smaller loads does not mean that LTL is always the best choice for you. With greater visibility over the options available, you may find that truckload shipping is a more cost-effective option for that route. Similarly, your loads may always have been shipped by road, but rail may be faster through certain areas of the country, and for a lower cost. This even applies to expedited shipping. While air freight is the most commonly selected option for rapid delivery, a team truck could be considerably cheaper.

Improved supply chain agility: A more visible supply chain has greater agility when responding to changing market conditions, customer demands and operational requirements. The real-time analytics gained from increased visibility allow you to quickly adapt to changes in schedules without needing to reach out to your logistics provider .

Enhanced risk management: By monitoring supply chain activities comprehensively, you can identify and assess potential risks, such as extreme weather, supplier delays, or transportation disruptions, early on. This proactive approach allows you to develop contingency plans, reroute shipments, or adjust production schedules to minimize supply chain disruptions and reduce unnecessary expenditure.

Strengthened collaboration: Real-time visibility makes collaboration and communication between different supply chain partners easier. This transparency enables a shared understanding of challenges and opportunities, promoting joint problem-solving and improved overall supply chain performance.

Improved efficiency: By tracking the movement of goods in real time, businesses can identify bottlenecks and inefficiencies in their supply chain network. This information can then be used to improve shipping routes, negotiate better deals with carriers and get products to their destinations faster.

Improved inventory management: Comprehensive supply chain visibility allows businesses to track the movement of goods and raw materials throughout the entire supply chain, from procurement to delivery. This real-time information enables businesses to optimize inventory levels, avoid overstocking and prevent stockouts, which can lead to costly excess carrying costs and lost sales.

Financial oversight: The increased visibility of costs provides clarity to your CFO or accounting department when it comes to any changes in logistics expenditure. If your spend has increased quarter-on-quarter, you will be able to isolate the causes for that increase, whether it be due to higher volumes being moved or greater carrier costs.

Reports on carrier performance: Increased supply chain visibility allows you to pull accurate data on your carriers’ effectiveness. Plus, if their figures and yours don’t match up, you will have the information as to why. If a carrier tells you they have an 89% on-time rate, but your figures only show 65%, you may want to reconsider using them. However, if there has been an unusual amount of disruption to this carrier’s route, you will also be able to see this in your report, explaining some of the disparity between their numbers and yours.

How to improve supply chain visibility

The entire reason behind wanting to gain full visibility over your supply chain is to help you make the most informed decisions possible on each element of your logistics. In order to do this, you need to be sourcing insights and analytics from across the entirety of your supply chain.

Tracking technology

Technology such as IoT (Internet of Things) devices, RFID tags and satellite tracking can help you monitor the movement of your freight in real time. This can help you track individual shipments, providing greater clarity in the event of disruptions so you can adjust warehouse staffing accordingly. Over time, multiple recorded journeys will build up a picture that can help you spot bottlenecks or repeated friction points on your shipping routes.

Shipment optimization software

Trying to run your shipping operations without dedicated software today is akin to pouring money down the drain. The amount of valuable data that can be gleaned from logistics operations is far beyond what even the most talented administrators can manage with spreadsheets.

Shipment optimization software takes all the real-time freight tracking and supply chain efficiency data and presents it to you in a simple, user-friendly way.

The improvements that can be made to efficiency with this software are enormous. For perspective, one of our clients, a multi-billion-dollar retailer, had previously managed all of their logistics operations through spreadsheets. This meant their fleet managers were having to call carriers directly to assign loads and check up on the location of shipments.

This business now uses our Allink360™ software, and the improvements from this digital transformation have been dramatic. In the first year alone, they saved over 30% on their logistics overheads by optimizing carrier selection and adjusting warehouse staffing according to shipment departure and arrival times. This was all made possible by the increased visibility afforded by the shipment optimization software.

Centralize data and improve collaboration with partners

If all the information you collect on your supply chain comes solely from your company’s perspective, you’re only getting half the story. To truly enhance supply chain visibility, it’s vital that you establish robust collaborations with your partners and centralize all data collected.

The integration of your software system with partners’ IT infrastructure is a strategic move. By sharing data seamlessly, you not only improve visibility for your own network but also contribute to the efficiency of your partners’ operations. If your partners receive advanced shipping notices, status updates and proactive alerts directly, they can streamline their operations without needing to contact you, making the entire process more efficient.

Final thoughts

In the modern logistics landscape, increased supply chain visibility is not just a luxury but a necessity. The impact enhanced visibility has for almost every aspect of supply chain management is enormous, and can be completely transformative.

In a world where every detail matters, a well-optimized and transparent supply chain becomes a competitive advantage, ensuring resilience and success in the face of evolving challenges. From efficient staffing allocation to route optimization, carrier selection and real-time risk management, the benefits of supply chain visibility improvements cannot be overstated.

Realizing these advantages requires embracing cutting-edge solutions like shipment optimization software and fostering collaborative relationships with partners.

At Harte Hanks, our Allink360™ software has simplified and optimized supply chain management for national and multinational clients alike, and resulted in significant cost savings and operational efficiencies. With over 9,000 vetted carriers across North America at your fingertips, real-time freight tracking and granular spend data, Allink360™ enables you to squeeze every last ounce of efficiency from your supply chain.

About the author

Mark Michaud

Mark is the Vice President of Business Development at Harte Hanks. He is seasoned Senior Supply Chain Sales and Operations Executive with over 30 years’ experience. Mark specializes in fostering strategic initiatives that utilize technology and data analysis to maximize cost savings and customer loyalty for major brands.

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