End-to-end supply chain visibility is a foundational enabler of the strategic capabilities needed to succeed in today’s retail marketplace. Retail and consumer companies must master the complexities of globalization and hone differentiated speed-to-market models that can function across greater distances and among more stakeholders than ever before. This demands clarity into raw material origins; product, order and shipment status; and information about product flow, delays, inventories and costs.
But as much as 80% of the information required for actionable supply chain decisions can reside externally with suppliers, third-party logistics providers (3PLs) and brokers, among others.
The challenge, then, is choosing the right visibility operating model—one that is neither too basic nor too complex when compared to business needs. Models can be as simple as developing point-to-point enterprise data interchanges (EDIs) to select suppliers or as complex as major end-to-end programs spanning all enterprise functions, involving robust cloud-based solutions and comprising multiple external entities.
EVALUATING BUSINESS NEEDS TO CHOOSE AN OPTIMAL OPERATING MODEL
Kurt Salmon helps evaluate and implement supply chain visibility operating models based on each organization’s unique business and visibility goals, e.g., bypassing distribution centers, enabling store-ready shipments, modifying in-transit orders or future-state goals, such as moving to (or from) regional logistics providers. The models vary depending on these needs and any internal resource constraints and include:
- Self-Developed: Home-grown, point-to-point connections to select business partners through the use of EDI or business-to-business (B2B) application programming interfaces (APIs)
- Enterprise Resource Planning (ERP) Supported: Use of extensions provided by incumbent ERP solutions augmented by B2B connections and/or private clouds
- 3PL Enabled: Through logistics providers, such as DHL, who typically use a third-party cloud solution as a backbone
- Third-Party Provided: Independent implementation of a cloud-based solution, such as GT Nexus or Amber Road
Rather than viewing visibility as a business unit or functional expertise, Kurt Salmon works with a C-suite champion, such as the chief operating officer, chief information officer or chief supply chain officer, to ensure cross-enterprise integration and success.
To determine the optimal visibility model for clients, Kurt Salmon walks organizations through a detailed evaluation exploring what capabilities need to be supported (functionality); whether information neutrality is a priority (control and autonomy); whether the company has the internal resources to implement and maintain the solution (simplicity); the lead time to reap the true benefit of the solution (time to value); the investment in and ongoing cost of maintaining the program (cost); and the level of dependence on the solution provider post-implementation (ongoing support and training).
BETTER SIGHT SO YOU CAN SCALE
A well-designed and implemented visibility program can drive benefits across the entire retail enterprise, informing both strategic direction and tactical operations. Included among the resulting improvements are lower costs, faster shipments, shorter cash collection cycles and more socially responsible supply chains. Specifically for retail and consumer companies experiencing high growth, visibility models can offer critical support. For example, Kurt Salmon helped a multibillion-dollar fast-fashion retailer select a visibility operating model to enable a supply chain that could support 20% to 30% year-over-year growth.
SIDEBAR: PARTNERING TO OFFER YOU A PERSONALIZED SOLUTION
Kurt Salmon’s detailed framework helps retail and consumer companies identify and implement the right visibility solution based on their business needs. With deep retail industry knowledge and experience, our customized methodology empowers clients to hone their capabilities in omnichannel, order management and inventory optimization, among other areas. As visibility impacts internal and external stakeholders, we leverage our vast change management knowledge base and end-to-end supply chain experience to cater our framework and implementation process to clients’ needs.