The extent to which the supply chain succeeds or fails impacts all other aspects of a business. Disruptions in logistics cause disruptions in inventory management, which affects sales and customer service. As commerce becomes more global, maintaining supply chain efficiency becomes even more critical.
The growing global market represents an opportunity for increased profits, but it comes with a few challenges. The broader and more complex the shipping process grows; the more potential disruptions emerge. When your products are thousands of miles away from your headquarters, seeing and addressing these issues can be challenging.
Just as technology enables global supply chains, it provides tools to handle them. With modern technology’s help, you can reduce logistics risks through supply chain monitoring.
Benefits of Optimized Supply Chain Monitoring
Effective management in any work environment relies on information. You can’t expect to manage a team well if you don’t know what your team members are doing. This same concept applies to managing supply chains.
Whether you’re dealing with people or shipped goods, an uninformed manager is an ineffective one. As supply chains grow in their scope and complexity, being informed becomes all the more crucial. If you’re not monitoring your supply chain, you won’t be able to handle potential disruptions or hazards when they arise.
Effective supply chain monitoring offers undeniable benefits. Tracking products throughout the logistics process allows you to measure the efficacy of your quality control measures. Similarly, real-time tracking enables you to adjust to disruptions faster — increasing efficiency and decreasing risk.
Modern monitoring solutions like data analytics make it possible to optimize your supply chain. Data analytics solutions can highlight areas of improvement and offer possible solutions. Predictive analytics can even forecast potential hazards so you can prepare to tackle them.
The advantages of supply chain monitoring aren’t hard to see. But how can you ensure your monitoring solutions are effective? Here are a few ways to upgrade your observational methods and subsequently streamline your supply chain:
1. Monitor Various Factors
The first step in optimizing supply chain monitoring is expanding what factors you monitor. Any data analytics services you use will be most effective if you have more information available to measure. To get the most out of your monitoring systems, you should start measuring influential components before any product leaves the warehouse.
Your processes aren’t the only ones that affect your supply chain. Measuring the performance of your suppliers and partners lets you know how your business relationships are impacting your company. Tracking these factors will also keep you informed about any disruptions on their end.
You should monitor the use of any assets throughout the logistics process. You can remotely monitor resources like compressed air or refrigeration systems to ensure the tools protecting your products run smoothly. You should track anything that affects product quality, not just the items themselves.
Some factors may be outside of your control, but you can still monitor them. Environmental hazards like inclement weather can threaten supply chain efficacy and safety. You can track them through sensors enabled with the Internet of Things (IoT) technology and GPS systems. While you can’t change these factors, you can take steps to avoid them.
2. Consolidate Your System
When you’re monitoring so many different factors, it’s easy to use various systems to handle the data. But while you should diversify your data points, the same isn’t true of how you process the information. A centralized data analysis solution will be more user-friendly and informative.
Opting for a consolidated system may mean more work while establishing your monitoring process. Not all remote monitoring tools will work on the same network, so you’ll have to take compatibility into account. But once you build a cohesive system, the benefits will begin to emerge.
With a centralized network, you can see all your results in a single place. If you use data analytics software, this centralization will help it produce more accurate insights. All aspects of the supply chain affect the whole, so you should monitor them together.
3. Benchmark Your Performance
On top of all the product and transportation factors you study, you should analyze success metrics. You can use the influx of data to measure things like order cycle time and fine-tune order percentages. But this data doesn’t help you at all if you don’t do anything with it.
Metrics like these allow you to recognize and work toward benchmarks. You’re not the only one measuring supply chain key performance indicators (KPIs), so you can find other industry examples against which to compare. Use your comparative performance to identify your areas of strength and weakness.
An optimized supply chain is one that continuously improves. Without recognizing industry standards, you can’t hope to grow to any relevant extent. Benchmarking enables your supply chain to evolve with the rest of the industry.
4. Communicate Results
The wealth of data you acquire isn’t worth much if you don’t communicate it. Communicating data is especially important in the supply chain, where quick adjustments are often necessary to avoid disruption. Establishing proactive measures to handle potential hazards is a must, but you also need to prepare to handle unforeseen obstacles.
Ensure you have a clear and practical communication system in place. When your monitoring system alerts you of an incoming disruption, contact the affected transport so they can alter their actions and avoid it. Your monitoring solution is only as effective as how quickly you can communicate its readings.
In addition to disruption alerts, you should communicate data regarding performance. If a section of the supply chain can develop, contact those involved and tell them how they can improve their performance. Some adjustments may take time, but you may be able to fix some issues relatively quickly.
Effectively Monitored Supply Chains
With sufficient monitoring, you’ll see substantial growth in your supply chain. Global-scale logistics may be complicated, but you can manage it by using available technology. Thoughtful implementation of this tech, along with robust management strategies, will increase supply chain visibility and improve profits.
Gathering varied, relevant data and processing it through a consolidated system will give you the tools you need to grow. Benchmarking and thorough communication will ensure you effectively use these tools to improve. Optimized supply chain monitoring offers too many benefits to ignore.
Guest Blogger – Megan Ray Nichols
Megan Ray Nichols is a freelance technical writer. She also runs her own blog, Schooled By Science, a blog dedicated to making complicated scientific topics easier to understand. You can follow Megan on Twitter @nicholsrmegan to keep up with the latest news.
Header photo: LeoWolfert – Getty Images