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Tuesday, June 14, 2022

Types of Visibility That Boost Supply Chain Resilience

With Ukraine examples,  

The Two Types of Visibility That Boost Supply Chain Resilience in SupplyChain Brain

The pandemic and war in Ukraine have caused serious disruption to supply chains. Analysis by Interos shows that more than 2,100 U.S.-based firms, and at least 1,200 in Europe, have Tier 1 suppliers in Russia. In addition, more than 190,000 firms in the U.S. and at least 109,000 in Europe have Tier 2 and 3 suppliers located there.

As companies navigate through the continued pandemic response and uncertainty caused by the war, they’re facing challenges around instability of supply, price inflation, logistics disruption and labor impacts. As a result, the traditional notion of building resiliency in supply chains is evolving — and it should. No longer can companies focus only on flexible manufacturing, increasing inventory or varying supply sources. Instead, the key to building resilience is visibility.

Research from Accenture found that companies with greater visibility are better positioned to handle all kinds of disruptions, creating a more resilient supply chain. What may come as a surprise is that companies don’t need full visibility into everything: An intelligent view into certain product lines, customers or suppliers is often enough.

But what is visibility — and, more specifically, “intelligent visibility” that can be achieved with the use of new technologies and analytics? Most supply chain professionals have a general ideal of what the word means, but there actually are two types of visibility that create resilience in supply chains: structural and dynamic.

Structural Visibility

Structural visibility tells companies where their suppliers and points of manufacturing are, and which logistics routes they use (including those of their partners), and shows interrelationships across the broader supply chain network. It includes traditional activities such as network mapping, classic risk management, network assessments and modeling. Structural visibility is like an X-ray that gives a company a snapshot of its operations at a point in time or over a certain period, and helps uncover vulnerabilities.

Leading companies are generating greater structural visibility using new technologies like the digital twin, a virtual replica of the company’s supply chain. It allows a company to use advanced analytics to simulate and model its supply chain’s performance, and stress-test for risks and vulnerabilities, both critical best practices in preparing for disruptions.

Most companies employ regular network mapping, classic risk management and network simulation, optimization and modeling, a best practice that’s typically done more frequently in times of disruption. While structural visibility isn’t necessarily available for the entire supply base, it can be limited to certain suppliers. ....'

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