What is Supply Chain Visibility?

Supply chain visibility is a form of transparency applied to the supply chain, allowing people to track goods as they move between locations on a supply chain and between origins and destinations. In the late 20th century, an increasing demand for supply chain visibility arose for a variety of reasons, ranging from wanting to protect the integrity of products to a desire to ensure shipping efficiency. There are a number of tools for enabling supply chain visibility available from a variety of companies.

A simple example of supply chain visibility on the consumer side can be seen by most people who order products shipped to their home. Historically, when people ordered something like a box of books, they would send a payment and wait four to six weeks for the books to arrive. Today, the shipper sends a notice to confirm the order, tells people when their books ship, and provides a tracking number to allow consumers to follow the books as they move from the warehouse to the customer's door. The same process is at play on a larger scale with commercial supply chains.

Supply chain visibility allows people to track supplies in raw, partially completed, and finished form as they move between various parties involved in the process of getting them from the origin to the destination. Information is provided at every step of the way, including package weights, names of people who handle supplies, details from inspections, and so forth. Supply chain visibility keeps the practices of suppliers transparent and reduces the risk of fraud, substitutions, and losses.

It also permits people to identify areas of inefficiency on the supply chain. This allows companies to change the way they handle their supply chains to eliminate bottlenecks and other problems that may arise. For example, if people notice that routing containers through Port X results in a delay of a month when Port Y moves containers much more quickly, they can make a request for Port Y be used for their shipments in the future.

Supply chain visibility is also important to companies that want to be able to verify the origins of the products they sell. An example can be seen in the diamond industry, where consumer complaints about conflict diamonds have led to certification programs to track diamonds from the point they are mined to the moment they are set in jewelry. This requires the use of interconnected tracking systems and dedicated personnel to ensure that unauthorized diamonds do not enter the supply chain.