Retail

Understanding visibility in a time of change

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From inventory levels to trade barriers, awareness of the position and flow of your supply-chain is more valuable than ever

Supply-chain professionals who are looking for new technologies to lower costs and increase profits are bombarded with one term more than almost any other: visibility. It’s the catch-all buzzword in supply chain, but its meaning has evolved as new technologies and economic necessity have expanded its definition both deeper and wider.

Today, visibility is most likely referring to two related, but very different, sets of information. Let’s take a closer look:

Static visibility

For a wholesale warehouse manager whose job is to maintain sufficient stock levels in the face of variable demand, visibility almost certainly means a simple, clear and actionable view of available inventory.

But expectations of what falls within the scope of that visibility are changing. When warehouse managers seek visibility today, they are increasingly looking not just to manage their in-house or regional inventory, they are broadening their search to include networked global inventories that can offer local solutions.

A mining equipment dealer, for instance, may currently have management visibility over the stock it carries in any of a handful of warehouses in South America. But what about available stock from the manufacturer’s North American, European or Asian divisions? Visibility today includes both the detailed and granular as well as the global: greater resolution, wider scope.

This wide-angle management visibility gives businesses options and the ability to make decisions. And it is as important for retail as it is for wholesale.

The move to omnichannel sales via both brick-and-mortar and online shops has meant that retailers have found themselves managing two sets of inventories: one bound for store shelves and another for online. Gaining full visibility of both—and managing them as a single inventory—has enabled retailers to offer enormously popular, flexible services that, for instance, let customers buy online then pick up or return in-store.

With 68% of online shoppers now more likely to make a purchase decision based on delivery and return options, static supply-chain visibility and management has become a critical component of a retailer’s brand value.

Dynamic visibility

Within the supply chain, another expectation attached to the term visibility relates to in-transit flow. While static visibility pertains to inventory, availability and access, dynamic supply-chain visibility is all about stock movement and deliveries, as well as insights from the wider world and how they might impact the business.

As demand is expressed through orders, whether it is fulfilled or not is entirely due to disruptions—most of which occur outside of the supply-chain. So, visibility in this context refers to not only the movement of the item through the supply chain, but also to the conditions that can impact that movement, like weather, industrial action or economic factors like fluctuating fuel prices or newly-imposed customs requirements.

The mining equipment wholesaler, for instance, may have a critical part on order from a warehouse in Asia, but not have visibility over where it is in its journey, nor over disruptive weather, or other external factors that are likely to create a disruption in its transport plan.

Conclusion

In the early days of e-commerce, organisations ran two separate supply chains: one for online and one for bricks and mortar. Smart businesses now realise that it’s both expensive and inefficient to operate that way.

With the British high streets and complex manufacturing supply chains under pressure, the speed required to adapt to macroeconomic changes (US tariffs, Brexit) means efficiency and awareness will be critical to navigating the changes ahead.

To learn more about how IBM can help you have better visibility and control over your supply chain, join us at Think Summit London 2019 https://ibm.co/2k1F1Rs and visit http://ibm.biz/wscblog

IBM Software Sales

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