24 Nov 2022

Supply Chain Control Tower - Value from Visibility

A Supply chain control tower is the concept that helps organizations in combining the process, data, people, and technology during the supply chain management process and have control over the operations and issues emerging during those operations.

Supply Chain Control Tower - Value from Visibility

When the pandemic hit the world in 2019, every business experienced one or other supply chain disruption. The COVID-19 pandemic brought to notice the vulnerabilities of modern-day supply chains. When these vulnerabilities are combined with geopolitical challenges and the move to reshoring and nearshoring, business leaders need to be more aware of the potential supply chain disruptions. One of the biggest challenges that business planners faced was visibility. Businesses need to ensure that they know what is happening in their supply chains, where it is happening, and how it is happening. This way, they can find solutions before a small disruption could convert into big expensive problems. Supply chain control towers can provide the required visibility that helps organizations in navigating complexity.

What is a Supply Chain Control Tower?

Control Tower in supply chain is a cloud-based platform that uses advanced technologies such as the Internet of Things (IoT), Artificial Intelligence (AI), and Machine Learning (ML) to provide real-time insights and helps in managing supply chains proactively.

It offers real-time end-to-end visibility across a network of an entire organization. This network may include suppliers, manufacturers, and business partners. They allow planners to manage what they cannot see, create planning for unknown variations, and plan for mitigation of risks and disruption before they cause any problems. Traditional ways of demand planning and supply change management using historical data can no longer give accurate demand forecasts and disruption because of factors such as extreme weather trade wars and blockages of transportation channels. Today, businesses need to make their supply chains agile and resilient with better visibility and access to real-time information.

The most important component of any control tower is the data. These analysis systems collect huge amounts of real-time data from different nodes of supply chains which provides a 360-degree view of anything happening across the supply chain in real time. The data collected from the supply chain is used for simulating ‘What If’ analysis and comparing scenarios. It also runs simulations of changes in demand and supply. With the help of this data, control towers can identify customer alert issues and address them rapidly. It allows them to collaborate with partners across the supply chain and automate exception flagging and handling.

As there has been advancement in technology, the supply chain control towers have eliminated the silos and allowed businesses to stay connected with their entire supply chain.

What are the Different Types of Control Towers?

The control towers not only consolidate and display data but also allow businesses to act on the issues as they arise and fix them in real-time. Typically, there are two types of operational control towers namely transportation-focused control towers and supply chain-focused control towers.

1. Transportation-Focused Control Tower
This type of control tower mainly offers insights into outbound as well as inbound shipments along with the visibility of ASN, deliveries, freight spends, delivery time, track and trace, and other details of the shipment. As they have a narrowed focus on transportation, they are considered as an add-on with a Transport Management System (TMS). They have a limited scope of focus which means that they are siloed from other processes of supply chain management, and they can provide granular visibility for transportation and lack in providing end-to-end visibility.

2. Supply Chain-Focused Control Tower
 This type of control tower is focused on a multi-node supply chain and hence ensures visibility and control of internal as well as external processes and nodal points. In addition to logistics, it is focused on sales and purchase orders, inventory data, manufacturing, maintenance, and repairs. They offer end-to-end visibility across the entire supply chain network, they provide more comprehensive, real-time insights to collaborate with partners and suppliers.

Functions of Supply Chain Control Tower

Functions of supply chain control tower

At the primary level, there are 3 levels of control tower functions:

1. Real-Time Order Planning: To improve the customer experience and service levels, the control tower must be able to capture and use important data such as inventory availability, delivery time, and transportation cost in real-time. This way, it allows for choosing the most cost-effective order flow.

2. Exceptions Management: A control tower needs to be able to focus on consistently delivering on time in full (OTIF) by efficiently tracking the supply chain markers and sending alerts when an issue emerges. More importantly, the platform must allow taking action directly from the application.

3. Granular Visibility: In addition to tracing and tracking, the platform needs to provide granular visibility into the details of every order so that it could be fulfilled on every required aspect.

How Do Supply Chain Control Towers Work?

There are five steps involved in the supply chain control tower architecture.

Step 1 - It automatically collects structured and unstructured data from different sources across the entire supply chain such as barcodes, Internet of Things (IoT), traffic data, remote sensors, and weather. This helps in providing accurate real-time insights.

Step 2 - It Integrates the collected data with logic to obtain up-to-date information via user-friendly dashboards that give information about core operational functions such as product development, inventory management, order planning, manufacturing, and many others.

Step 3 - It leverages granular visibility to improve reaction time when responding to operational and tactical disruptions. It can also use data analysis to predict the events that may affect the supply chain in the near future. This is done so swiftly that supply chains can identify and prioritize issues.

Step 4 - As it has the ability to identify the reasons for issues and trace the source of the problems, it supports automation in decision-making and self-correction. It continuously learns, senses, responds, and improves with the help of Artificial Intelligence and Machine Learning.

Step 5 - It creates procedure playbooks that define how to solve issues specific to supply chain management making it easier for stakeholders to handle the planning and operations.

What are the Capabilities of a Supply Chain Control Tower?

The 6 key capabilities of a supply chain control tower include:

1. Continuous data capture with real-time event stream processing and business activity monitoring.

2. Use predictive and prescriptive analytics to turn from reactive to proactive management.

3. Understand the impact of signals from the digital ecosystem on the company’s supply chain.

4. Simulation of different ‘what if’ scenarios to prepare for a suitable smart response.

5. Enable collaboration of different nodes of the supply chain to work in coherence.

6. Drive a higher level of understanding and automation through artificial intelligence and machine learning.

What Makes the 3SC Control Tower Special?

3SC control towers are driven by advanced AI algorithms for more agile, intelligent, and efficient supply chain planning and management our Planning control tower gives a more accurate look into supply, distribution, production, and inventory along with real-time visibility and automated responses. Our execution control tower provides a full audit trail with an accurate and reliable management system that offers high-yield returns along with high data security.

FAQs

What are real-world examples of supply chain control towers?

The real-world supply chain control towers examples include control towers used by businesses, transportation companies, and shipping corporations to get end-to-end visibility of every node of their supply chain.

What are the essential pillars of a supply chain control tower?

Its four essential pillars include use-case-based capabilities, finding new ways of working, flexible technological structure, and robust data strategy and governance.

Why the supply chain control tower is important?

It is important as it provides end-to-end visibility of all the elements of the entire supp[ly chain which is essential for a proactive supply chain management plan.

How to deploy a supply chain control tower?

They can be deployed in two ways. Buying from a third-party solution provider is easier and more convenient. Another way is to build a control tower using business intelligence and create a data lake.

What are the possible challenges when establishing a supply chain control tower?

Lack of clarity, resistance when eliminating the functional silos, actual data ownership, required expertise, and lack of knowledge about required technologies are some of the challenges that may emerge while establishing a control tower.

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