What Is Supply Chain Visibility and Why Is It Important?

Supply chain visibility (SCV) is the ability of parts, components or products in transit to be tracked from manufacturer to final destination. The goal of SCV is to improve and strengthen the supply chain by making data readily available to all stakeholders, including the customer.

By identifying areas of the supply chain that cause delays or wasteful spending, organizations can increase production efficiency. To achieve supply chain visibility, every transaction from every department must be fully accessible and transparent. While historically accessible through a variety of methods and systems, this data was kept in data silos within a specific department. This information must be accessible at every stage of the supply chain in a unified view in order to achieve supply chain visibility.

Supply Chain Visibility

Who uses supply chain visibility?

Supply chain visibility software is used by several positions within an organization as part of their regular duties. Some common positions that monitor a companys supply network include:

What is supply chain visibility?

The ability to monitor supply chain movements across the entire supply chain is known as supply chain visibility (SCV). Many businesses monitor supply chain activity from suppliers to manufacturing facilities. They also track movement from production facilities to customers. This enables a business to modify its operations to lessen supply chain challenges. They can also consistently deliver their goods on schedule with its assistance. To keep an eye on their network, many businesses employ a variety of digital and physical systems.

What information do companies track as a part of supply chain visibility?

Companies track a variety of information in their supply chain. This makes it easier for them to track individual shipments and see how their goods are moving through the supply chain. The following types of data are frequently tracked as part of supply chain visibility:

Why is supply chain visibility important?

To ensure proper delivery to their customers, many businesses actively monitor their networks. Some additional reasons supply chain visibility is important include:

Helps manage complex supply chains

A variety of suppliers, vendors, production sites, and customers are all involved in many supply chains. Companies that monitor every link in the supply chain can change that link as necessary to better meet their needs and those of their clients. For instance, a business may monitor the effectiveness of each of its various material suppliers. By doing so, they can spot any supply trends that might be related to quality, quantity, or timely delivery.

Improves delivery timelines

Companies can track every step of the supply chain to find out when customers receive their products. A company can allocate extra resources to boost production outputs if a section of the supply chain is running behind schedule. They can use this to align their supply chain with predetermined timelines. For instance, a company might ask its material suppliers to send more supplies if they find that their production demand exceeds their current supplies. This will enable them to meet production demands and timely deliver finished goods to customers.

Enhances regulatory compliance

Many companies have global supply networks. To ensure regulatory compliance, it is crucial for these businesses to monitor every step of their supply chain. This increases the likelihood that supplies or goods will arrive by the deadline. The rules governing procurement, tariffs, and country trade agreements are some crucial regulations that businesses need to monitor.

For instance, a business might purchase lumber from a different nation. They can monitor government tariffs related to importing raw lumber to make sure they are paid in full. Due to the fact that the company already paid all lumber tariffs, this can prevent any additional processing at port-of-hold areas.

Increases competitive advantage

Supply chains can be closely watched by businesses to quickly spot and remove any network obstacles. They could produce and release goods more quickly as a result of this. Companies can build long-lasting relationships with their customers and increase customer loyalty by quickly delivering these products to them.

A business can lower its production, warehousing, or transportation costs by identifying and removing supply chain obstacles. For instance, a business can save money on labor if it automates several of its production processes to improve visibility. A company can assign its employees to various positions within the organization, reduce the number of required work hours, or do away with overtime expectations by automating certain processes.

How can you improve supply chain visibility?

There are several ways a business can increase supply chain visibility to cut costs and accelerate delivery times. Some ways to improve supply chain visibility include:

Implement SCV technology

Utilizing SCV technology can assist you in managing specific supply chain elements. You can monitor your company’s entire supply chain with some software programs, while others concentrate on specific operations like inventory management, demand forecasting, or warehouse management. Technology can also assist you and your business in quickly identifying supply chain trends, such as averages for production capabilities and delivery timeline trends.

Identify supply chain improvements

You can enhance the performance of your supply chain by identifying improvement areas. Parts of your supply chain can be automated to help reduce errors in the chain. For instance, a system that generates shipping documentation automatically can help decrease documentation errors to improve delivery accuracy. This may lower transportation costs while increasing customer satisfaction and loyalty.

Foster supply chain efficiency

Increasing output throughout the supply chain can help your business deliver goods or services more quickly than rivals. A supply network can benefit from incorporating robotics, automation, and digitization to increase production output and efficiency. Increasing productivity can also increase a company’s profit margins.

Revise supply chain strategies

Businesses that maintain flexibility in their supply chain strategies are better able to adjust to shifting supply chain needs. To increase business profitability, some businesses switch to reverse or circular logistics strategies. Companies can improve their supply chains and increase their visibility by establishing intervals for evaluating and revising their logistics strategies.


Why is visibility important in supply chain?

The capacity to track various products and/or goods in transit provides a clear picture of the inventory and activity in the supply chain. It enables shippers to enhance customer service and cost management through proactive status updates, inventory management in motion, limiting disruptions, and risk mitigation.

How do you get supply chain visibility?

5 Steps To Improve Supply Chain Visibility in 2022
  1. Analyze the supply chain.
  2. Prioritize problems based on strategic objectives and goals after identifying them.
  3. Improve collaboration with suppliers, partners, and competitors.
  4. Balance digital technology and dexterity.
  5. Measure and improve with the help of KPIs.

What is supply chain visibility and agility?

Business visibility is a step toward agility. The agile supply chain operates with competence, speed, responsiveness, and flexibility on a daily basis. By implementing agile practices, businesses can better manage supply chain risks such as market volatility, political and economic changes, natural disasters, strikes, and others.

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