Over the past few years, businesses have
had to learn that their supply chains
need to be much more resilient. Raw
material and component shortages, along with
increasing operating and merchandise costs, have
continued to exert enormous pressures on global
supply chains across the manufacturing and logistics
sector, which is still recovering from a global
pandemic. But the solution to these issues doesn’t
lie in simply holding more inventory and building
redundant capacity—both of which increase costs.
Thankfully, advances in tech, specifically artificial
intelligence (AI) and analytics, have opened the
door to a new, cost-effective way to improving
the resilience of supply chains: intelligent visibility.
What is intelligent visibility?
Intelligent visibility gives companies a deeper view
into the extended supply chain. These insights help
companies react faster and make better, fact-based
decisions around how to manage supply
chain disruptions and where to focus investments.
Companies can use intelligent visibility to build
new capabilities that help them assess where they’re
most vulnerable and enable them to see exactly
what’s occurring across their extended supply chain.
Recent Accenture research, based on interviews
with 30 supply chain executives, found that
companies with greater visibility into their supply
chains are more likely to retain revenue, profit,
and share price performance during periods of
disruption. Of course, this is a small sample of
companies, but their experiences suggest that visibility
can help companies avoid or bounce back
quicker from disruptions.
How does intelligent
visibility work?
Intelligent visibility is a combination of structural
and dynamic visibility supported by analytical
techniques and AI.
Structural visibility provides companies with
the full picture of their operations at a given
point in time or over a certain period. This oversight
helps to uncover issues surrounding where
their suppliers are, where points of manufacturing
and logistics route are, interrelationships
across the broader supply chain network, and
potential supply chain challenges.
On the other hand, dynamic visibility helps
companies understand what is happening right
now. Companies use it to monitor and respond
to events in real-time, helping them to see where
products are across the chain, how their plants
and warehouses are running, when and where
disruptions are happening, and how disruptions
are affecting the company.
Our research found that most companies
have an advanced level of structural visibility,
often using classic risk management and network
modeling, but executives said structural
visibility is restricted to particular suppliers
instead of the entirety of their supply base.
Often, these suppliers aren’t the ones that
present the most risk to the overall ability to
manufacture and deliver products.
Dynamic visibility, by contrast, was found to
be less mature across the companies researched.
Many companies reported that they used monitoring
and predicting, but only 40% said that they
use data prescriptively.
This revelation does not mean companies are
not trying to move to an enhanced real-time visibility.
In fact, significant investments in this space
have been made. Some of the common challenges
that need to be addressed include fragmented data
and operational technology, sourcing high quality
data from suppliers, and competing priorities for
the right level of investment to move at pace.
Driving greater
supply chain resiliency
Companies can and should use intelligent visibility
to drive greater supply chain resiliency, and we
found three key takeaways in this regard.
First, our research showed that companies with
greater visibility are better positioned to weather all
kinds of disruptions. Having said that, full visibility
across the supply chain isn’t necessary or economically
feasible. We found that it’s far more effective
to focus on the most important areas of the business.
Second, we found that structural visibility
is a necessity. Every company should have the
basics—network mapping, risk management, network
assessments, and modeling—in place, allowing
them to leverage advanced analytics to go to
the next level.
Finally, companies should always be targeting
more advanced dynamic visibility. Predictive visibility
and autonomous execution, achieved with
a sophisticated control tower, are the keys to
maximizing resiliency.
On a broader note, intelligent visibility should
be seen as a long-term investment. Supply chains
are expected to become even more complex and
dynamic to meet customer demands over the next
few years. Therefore, a sustainable visibility solution
is critical for continual optimization and improvement.
Those that fail to embrace intelligent visibility
could find themselves behind the curve.
