If you are a retailer you will know that knowing where products are in the new product development (NPD) and new product introduction (NPI) process means that you are better able to ensure a successful new product launch…
Retail supply chain risk mitigation
In addition, knowing where products are in the extended supply chain can help you to assess the likelihood of future availability issues. Having early warning mechanisms in place allows retailers to mitigate the risk of supply chain problems. It is not going to be any surprise to state that avoiding supply chain issues which would otherwise adversely affect sales and service levels is a massive benefit!
Inbound logistics tracking
Over the years I’ve had the opportunity to work on several projects that have involved the implementation of supply chain critical path and logistics tracking tools. I think these systems are great! Some are known as ‘Supply Chain Event Management’ or ‘SCEM’ – all more or less do the same thing – they track the progress of the inbound logistics chain, some from the point of manufacture, others from the point of shipping. All of these tools alert the user when events scheduled to take place in the defined physical flow of goods, from A to B, go off plan – meaning you can take action before the problems compound.
When retailers have greater visibility to supply chain risk the benefits are significant!
In my experience when retailers have the processes and information that enable them to have greater visibility of and therefore management of supply chain risk the benefit they can realise compared to the cost is just too good to be true!
The tools themselves enable the buying / supply chain teams to define and monitor the progress of a process flow. The value is most significant for retailers who manage global supply chains. Whilst each step of the process may have a different owner, many of whom are external to the retailer’s organisation (e.g. supplier, manufacturer, shipping agents etc) and many located across the globe, none of that dispersion matters!
Supply Chain Tracking enables real-time visibility of the state of your extended supply chain!
Supply chain tracking brings all of the actors in a retailers extended supply chain network together. Each party has immediate, real-time visibility of the status of a process and a personalised and prioritised task list to enable them to do what is required in the most timely and efficient manner… Gone are the days of problems not being noticed for days or even weeks – not issues can be nipped in the bud and contingency put in place.
Supplier performance management – visibility of key KPIs in your supply chain
In addition to the obvious benefits of using a supply chain visibility and tracking tool as an ‘early warning system’ for things which could affect the business, critical path and logistics tracking tools can also provide valuable information with regard to process adherence by the actors in a process. This information can inform such things as supplier KPIs and directly improve the supplier performance management process.
Knowing the true supplier lead time ensures you have optimal inventory in the supply chain!
Consider this: If a suppliers lead time is agreed at 30 days and yet regularly that supplier is delivering at 35 days it enables a conversation about improvement, or a realisation that the fact 35 days is an accurate reflective of the true lead time. If an inventory management tool is calculating stock cover on the basis of the next shipment arriving in 30 days and in fact the lead time is 35 there is a risk of 5 days of out of stock, and therefore lost sales.
Of course it can be the other way – if a supplier is regularly delivering early then the lead time as used by the stock management systems could be reduced, thereby reducing the overall stock levels (as cover is required for few days in the order cycle) and therefore reducing the capital investment in stock, with no impact on availability – now that’s a benefit we all know you’d like to have!
So basically, having the true picture of lead times enables a more open and honest conversation with the suppliers that will have a direct bearing on inventory and availability!
Health Warning! Systems and process are only as good as the information provided!
Just to remind anyone who may be thinking this is all too good to be true… like any other tool or system a critical path / tracking tool is only as good as the data within it and the ability of the users to use it! It is important to consider such as tool as a live system enabling continuous improvement and not a static monitor for complaining when things don’t get done. With this kind of monitoring you can learn what the true state of your critical path is, what the real lead times are, and you can make pragmatic changes to ensure that this new knowledge is built into future plans to avoid problems reoccurring.
If this is something you’d like to speak to me about, I’d be happy to help 
