The State of Supply Chain Visibility: Is the Industry Improving?

MercuryGate Blog - TMS Category
The state of supply chain visibility includes changing expectations for delivery, order fulfillment, and what makes excellent service. Unfortunately, supply chains suffer from significant issues, including poor freight management and higher costs. Even the United States Postal Service (USPS) is subject to the unrelenting push of more packages and fewer traditional shipments (letters in this case), notes The Washington Post. As globalization of supply chains continues, the state of supply chain visibility and the use of meaningful data will become the top priorities for all supply chain leaders.

What’s Wrong With the State of Supply Chain Visibility?

Visibility investment is still growing slower than the surging demands of e-commerce. Legacy systems limit insight, as well as increase IT overhead expenses, notes Supply Chain 24/7 . Without visibility, freight spend may rise 30% or more annually. Paired with changing demands for faster delivery, shippers may end up paying more for shipping than what customers pay. Such issues exist even when customers have the perception of “free shipping,” as seen when shipping costs built within the product price points. While supply chains typically cite visibility as key investment areas, actual investments still fall short. The overwhelming majority of shippers and logistics service providers (83%) still lack end-to-end visibility. The problem is genuine and threatens to undermine all improvements within the supply chain. Meanwhile, the industry seems stuck, incapable of recognizing the real harbingers of poor visibility.

Indicators That Supply Chains Need Visibility Improvement

Part of the problem with lackluster visibility goes back to an inability to recognize when a problem exists. To help supply chain enterprises acknowledge their problems, shippers should look for these tell-tale signs of poor visibility:
  • Increased rate of late or missed deliveries. More late deliveries will lead to failures to fulfill guarantees, opening the doors to even higher freight spend per package.
  • Poor customer service ratings. As deliveries fall by the wayside, customer service will suffer.
  • Higher freight spend. Carriers, while still accountable for some late or missed problems, will also charge higher rates for shippers that have inaccurate delivery data or fail to meet pickup schedules.
  • Lack of accountability among your carriers. A lack of accountability will lead to abuse of your dock schedule and even may lead to unauthorized, unnecessary accessorial and surcharges.
  • Poor dock management practices. Poor dock management will create bottlenecks in order fulfillment.
  • Reactive fulfillment strategies. Responsive strategies lead to higher inventory carrying costs, including the risk of “out of stocks.”
  • Not using dropshipping, cross-docking, and just-in-time fulfillment models. Not using fulfillment models that eliminate the physical inventory in your warehouse will result in money on the proverbial table, frustrated customers, and higher stress on your facilities and workers.

How to Ensure Better Visibility Within Your Organization

Supply chain leaders that wish to improve visibility should follow these tips:
  1. Implement real-time data collection sources and solutions that exist on the market today.
  2. Upgrade your TMS.
  3. Use advanced TMS enterprise visibility functions that integrate real-time visibility data to understand shipping activities at a moment’s notice.
  4. Take advantage of EDI or API based carrier onboarding processes.
  5. Aggregate data with self-reporting systems and automated reports.
  6. Use advanced analytics to understand supply chain activities.
  7. Deploy automated alerts and dashboards to reduce management stress.
  8. Centralize all communications within the TMS.
  9. Work with an enterprise transportation management platform provider who can bring best-in-class data flows and resource leverage for your freight team.

Put the Tools and Processes to Improve Visibility Into Action

Better visibility should be the endgame for all shippers and logistics service providers. Gains in visibility will have a lasting impact on customer service, employee satisfaction, and much more. Bring your organization into the modern age, aligning your business with the best practices of other key players in the global supply chain. Also, know how changing demand for supply chain visibility will drive innovation across both business-to-business and direct-to-consumer relationships. To put it more simply, upgrade your TMS, contributing to a better state of supply chain visibility within your entire supply chain.

Send us your contact infomration to connect with an expert today or call 1-919-469-8057 to get started.

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