The host of AI tools available today are a big differentiator when it comes to improving supply-chain visibility, but technology alone is not the most important component of a well-operating supply chain.

Technology can provide information to help solve a problem, but it’s the decisions that are made with the information that creates value. 

When I led the global supply chain at La-Z-Boy, we had technology tools at our disposal that could deliver sophisticated answers to sophisticated queries. For example, we ran multiple scenarios and modeled their outcomes, then worked to put mediations in place for potential issues where it made sense. But visibility technology was only effective working in tandem with other inputs that I’ll address here.   

Supplier Relationships

Strong supplier relationships require intent and effort from both sides to build the trust required to highlight issues before they become larger problems. First-tier suppliers naturally have better visibility than their customers deeper in the supplier chain, and if a relationship is properly developed, they can spot, communicate and prevent looming problems and potential disruptions early on. They can prevent problems before they become your problems.

Trusting relationships with top suppliers take time and are forged from mutual benefit. At La-Z-Boy, our suppliers visited us often, as is customary,  but strong supplier relationships go beyond customary.  My team and I frequently visited many of our suppliers at their locations around the world. We worked to understand their business as much as they worked to understand ours.  By meeting with our suppliers in person, we better understood their challenges. We could physically see and collaborate on solving logistics and quality problems and brainstorm on improving product flow. Perhaps most importantly, by meeting with them on their “turf,” when we said we wanted to be their best business partner, they believed and trusted us.

Early Warning Signals

Supply chain visibility, in part, is about predictive analytics. Intelligence can come from any number of IT systems.  I am also talking about developing diagnostic metrics where you have early warning signals in your supply base that can sound the alarm towards any performance drift.  My team identified critical KPIs and threshold levels that signaled some type of drift. 

For example, one category we had KPIs around was within the transportation environment.  We watched fuel prices, port activity, cargo capacity, among others. We wanted to understand early if shifts were occurring in the space. 

There’s not a one-size-fits-all when determining which KPIs to measure, as each organization has different needs and concerns, but they help to see movement across the supply chain.

People Still Matter Most

If you have read any of my previous IndustryWeek articles, you know I am a huge proponent of people, of talent.  I truly believe that within any organization, the teams with the best talent win the most in competition, and business is as competitive as any field of play.  The best tools in the world are suboptimized without top talent to use them well. 

When I discuss team talent, I tend to think more deeply than intellectual capability.  To be sure, smarts are important, but I’m also talking about organizational fit and core values.  A team of smart people that are aligned with values and mission is a formidable force. 

My team and I spent significant time managing and developing our talent.  We worked hard at succession planning, on career development plans and supporting the business strategy with talent.  We worked to anticipate future needs as well as where we might be vulnerable.  If we knew we would be onboarding a supplier in a new geography over the next year and needed talent to manage this region, we worked to shore up the gap before it became a gap.  Any gap in your supply chain, talent or otherwise, limits your visibility. 

Planning Is Your Scoreboard

There is probably no better scoreboard of visibility input than that displayed through integrated business planning (IBP).

Let’s unpack this. Planning touches everything within a supply chain. From procurement to manufacturing and logistics, planning has tenacles through all of it. 

That said, there is planning and there is good planning. Good planning results in excellent customer service, high OTIF (on time and in full).  It results in lower obsolete inventory and fewer discounts on finished goods.

Good planning exists when you have organizational alignment; when all functions have a voice and a seat at the table.  And when good planning exists, manufacturing operates with a rhythm, efficiently with little disruption.  And, of course, transportation is scheduled cost-effectively. When transportation assets are utilized efficiently, trucks are on the road, not sitting. Planning is the downstream result of all the upstream activities of the supply chain, and it usually reveals the quality of the planning inputs. 

Technology can clearly be the network that connects and enables everything else to deliver good results. But technology in isolation is suboptimized. People still matter, even in our hyper-modern supply chain. Relationships with your suppliers (and customers, too) and the strength of your team are the greatest predictors of supply chain success. 

We all can buy the best tools, but without the relationships and intellectual capability to use them, their power is diminished. When people, technology and planning are well-synchronized, your integrated business planning becomes easy because you have excellent visibility across the supply chain.