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Originally published on Logistics Viewpoints.

For more than a year, global supply chains have been buffeted by one major disruption after another. The surging Delta virus, devastating floods in China and Germany and cyber attacks on South African ports are amongst the latest in a series of events that continue to send shock waves throughout the system.

The impact? Raw materials are in short supply, many manufacturers have temporarily mothballed production lines, transportation costs are rising, and labor is getting tight on our roadwaysrailways and ocean vessels. We will certainly be feeling the repercussions throughout a bumpy holiday shopping season — and beyond.

In light of all of this, I’d posit we can no longer look at the events of the last year as an aberration. Supply chain management is now synonymous with “volatility management”. So how do we adjust to this new reality?

If you’re Home Depot, you reserve an entire ship for your own exclusive use. Don’t get me wrong — I applaud Home Depot management. It’s a creative and gutsy move at a time when there aren’t many great options for shippers. But it’s no formula for long-term success, and not every shipper can afford it.

Digital transformation is the formula. And for our global supply chains, that transformation cannot happen fast enough.

Real-time transportation visibility platforms tell shippers and their broker/carrier partners where their freight is at any point on its journey. Using AI and predictive analytics, we make it possible to anticipate and mitigate the impact of disruptions and delays, whether from bad weather, port shutdowns or overloaded distribution centers.

There is now a robust and growing market for real time transportation visibility solutions, which help shippers, carriers and the entire ecosystem run more cost-effective and efficient logistics operations. But we have to go further.

It’s no longer sufficient to only know where products are while in transit. We should know how much product is sitting in the port of origin. We should be able to see, with the click of a button, how much product is at the port of destination. And what is sitting in the warehouse. And at the cross-dock. And in the rail car. Until we have this kind of pervasive visibility, inventory management will continue to be largely an exercise in futility.

Real-time visibility into “static goods” — wherever they may be — is the foundation for managing through volatility. From there, we can upgrade supply planning systems, streamline procurement, revamp warehousing and distribution and, perhaps most importantly, enable collaboration across vast networks of supply chain partners to keep goods flowing.

We’ve seen firsthand the many positive effects of collaboration based on real-time transportation visibility data, as partners and even competitors — working off of one source of the truth — find efficiencies that benefit multiple partners. The ROI will only multiply with visibility into supplies and goods from end to end. It’s easy to foresee, for example, smaller importers and startups pooling their interests to more effectively compete against larger players, in much the same way ShipBob has empowered smaller ecommerce companies to create leverage together.

It’s clear that volatility is here to stay, and that every tremor affects different parts of the supply chain in many different ways, far into the future. Pervasive real-time visibility and collaboration are our best bets to manage through the uncertainty.

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