Globalisation has truly made the world smaller, more connected and supply chains no longer move items from point A to point B. To keep up with global demands, scm logistics now focus on building trust, sustainable processes and developing long-term relationships with customers and stakeholders. Transparency is a common denominator that ensures the success of all these efforts. Supply chain process transparency is not a fancy catch-phrase, it is an important strategy that can make or break a business’ reputation.
Why Transparency Matters
Transparency in logistics and supply chain management is extremely beneficial as it allows businesses to build trust with their suppliers, vendors and customers about their commitment to ethical operations, environmental sustainability and social responsibility. This is important at a time where consumers are more than willing to pay a little extra for products from brands that have similar values. For example, a recent survey by IBM concluded that more than 50% of respondents were looking for environmentally conscious brands over other factors when making a purchase.
Another area of scm management that benefits greatly from transparency is operational efficiency. Real-time tracking and visibility in the supply chain makes it easy to identify any possible bottlenecks, reduce risks and make process improvements. All of these ultimately help to improve operational budgeting and overall customer satisfaction. That’s not all, transparency also has a positive impact on regulatory compliance, as it significantly lowers the risk of any legal hassles and improves market reputation.
Challenges to Transparency
The benefits of transparency in supply chain management are many, however, there are several challenges that a lot of businesses and supply chain companies face when implementing the same. Data management is one of the main issues that plagues this system. Most supply chain process are built on a complex network of suppliers and distributors, which makes it difficult to collect and maintain data accurately. This can snowball into poor decision making and increase operational breakdowns.
Tech integration is another significant challenge, as it is not always easy to overhaul systems to make them digital-first. Blockchain and IoT technologies are reliable but also require heavy initial investment which may be tricky for businesses relying on traditional structures or legacy systems. Collaboration is the backbone of transparent supply chain operations and at times, vendors and suppliers hesitate to communicate effectively or share information which can affect the overall efforts directed towards building transparency. Compliance and changing regulations (locally and internationally) have the potential to further complicate matters.
How To Improve Transparency?
For businesses looking to revamp their logistic chain management operations to build in transparency – consider the following:
- Map Your Supply Chain: As the first step, begin by plotting a detailed map of your whole supply chain, do not miss any supplier or intermediary. Plotting all stakeholders in the process will give you a clear picture of where your raw materials are being sourced from.
- Build Supplier Partnerships: Work on developing strong relationships with suppliers and vendors by letting them know of your expectations and keeping communication clear and steady. This also helps to collaborate and quickly solve any issues that may arise.
- Use Advanced Software Solutions: Check how your business can integrate with technologies like blockchain or adapt a specialized supply chain management software to provide real-time tracking and data analytics. Doing so will help to identify any bottlenecks and improve operations and decision-making.
- Custom Client Dashboards: Companies like Jane are in the process of building customised dashboards for clients so that they can track progress and stay updated with project timelines. These dashboards increase transparency while also fostering client-vendor relationships from the timely updates on freight and orders.
Real-Life Examples
Many companies have been successful in adapting completely transparent supply chains. For example, Patagonia and Nike’s systems are considered industry standard as far as mapping supply chains and sharing findings publicly. Walmart implemented blockchain tech to track food from farm to shelf, thereby improving transparency and food safety. In a similar way, De Beers uses blockchain technology to make sure the diamonds are sourced ethically, fostering trust and loyalty with customers.
Thanks to globalisation, transparency in supply chains is an absolute necessity. Businesses can take their optimisation and sustainability efforts to new heights by building transparency into their systems. Innovation, rapid uptake of technology and collaboration will go a long way to overcome common challenges. Supply chain company like Jane continue to invest in transparency tools and systems, which improve their reputation while also contributing to build a more robust, sustainable and reliable global supply chain.
https://qodenext.com/blog/how-to-increase-supply-chain-transparency/
https://www.venuez.dk/case-studies-successful-implementation-of-transparent-supply-chains/
