3 Ways to Turn Supply Chain Visibility Data Into Better Results
By Kirsten Newbold-Knipp, Convey
Regardless of the industry, supply chain managers (SCM) tend to share a common problem: visibility. According to a survey that Convey conducted in partnership with EFT (Eye for Transport), almost 2/3 (65.6 percent) of over two hundred supply chain leaders said that connecting disparate data was among their top three challenges in improving the customer experience.
Due to the complexity of the modern supply chain, it’s more difficult than ever to see where your products are headed, and if there are obstacles along the way such as delays and damages, that may negatively impact customers. And as customer expectations for fast, free delivery grow, it’s a problem you must solve to have any chance of staying competitive.
Luckily, where there’s a commercial problem, you can bet there are companies selling products that provide a solution. Vendors in the supply chain industry know how important visibility is to e-commerce companies. At this year’s Gartner Supply Chain Summit, speaker Tracy Reiss from KBX Logistics commented that she’d counted a full 37 vendors that listed visibility as a key value proposition.
With so many different solutions, you’d think it would no longer be a problem. But finding the right tech alone isn’t enough to solve your problems -- there’s no “one-size fits all” solution for supply chain operations, and just seeing your shipping data doesn’t help to identify root causes or fix issues. A product that helps you achieve supply chain visibility is just the start. You also need to know what to do with that visibility data once you have it.
At Convey, we’ve seen three main ways that companies realize tangible benefits from putting their supply chain visibility data to use.
1. Improve Customer Experience (CX)
Customer experience is a topic that companies talk about a lot, but have a harder time acting on. That’s in part because customer expectations are changing so rapidly when it comes to when and how they receive their purchases.
In our study with EFT, we found that 96.3 percent of retail leaders consider CX to be important when measuring last mile supply chain performance, and supply chain leaders are increasingly being measured on customer experience KPIs, such as NPS and CSAT scores.
As customer expectations grow more demanding every year, companies have to work harder to deliver a level of service that inspires loyalty—an important factor for increasing customer lifetime value.
While most companies can’t compete with Amazon’s delivery speed or cost, they use supply chain data to improve the customer experience and fulfill brand promises. Top retailers are setting realistic expectations for their customers and practicing Delivery Experience Management. They are using visibility data to spot issues that could keep a shipment from arriving on the promised date, and proactively resolving issues before the customer ever knows there’s a problem. When that’s not an option, these brands proactively reach out to their customers to acknowledge the issue and reset customer expectations.
2. Minimize Capacity Issues
One of the biggest issues facing the supply chain industry is the driver shortage. Analysts say the deficit sits at around 60,000 drivers and project that it could triple by 2026. That’s a problem no one company can solve. What you can do is figure out ways to minimize its impact on your business.
Visibility data gives you the means to better understand transit times and identify optimal routes. When you have data that shows true transit times, you can accurately predict when shipments will arrive—which goes back to setting realistic customer expectations for better CX. And by understanding where all your shipments are, you can spot opportunities for arbitrage where diversifying your carrier mix or implementing techniques such as zone skipping allow you to save money without causing customer disappointment.
3. Optimize Inventory For Faster Shipping
Amazon’s recent move to offer free one-day shipping on certain orders has increased the pressure on other retailers to do the same at a low (or no) cost to customers.
But many experts question the need to provide one or two-day shipping to make customers happy. In fact, less than 10 percent of consumers say expedited shipping drives their purchasing decisions. They care more about the price being right and their expectations being met.
Instead of trying to beat Amazon at their (unwinnable) game, visibility data can help to increase the speed of delivery at a more affordable rate by making sure the right items are stocked in the right place(s) at the right time.
Inventory data is an invaluable resource to understand which high-value items are in regular demand, so you always have enough in stock to get an order out same day. Visibility data also helps you make strategic decisions around where to store different inventory so more of your orders see shorter shipping distances, and therefore faster shipping times.
Convert Insights Into Outcomes
Visibility data can be powerful. But before you can benefit from it, you need a strategy for how to use it. The three solutions above are just a start. When you fully see how your supply chain works, you gain countless insights that can result in cost savings for your company and better outcomes (and the resultant loyalty) for your customers.
Author The Author
As Convey, Inc.’s Chief Marketing Officer/VP, Kirsten focuses on marketing strategy and emboldening her team to drive results. Passionate about building successful teams from the ground-up, she has worked at companies ranging from the Ritz Carlton and Intel to Hubspot and Gartner. Kirsten is an animal lover, a wine enthusiast, and a polyglot. In her spare time, she volunteers as a Marketing Advisor to Austin Pets Alive, mentors students at MIT Sloan, and co-owns two companies.