The AberdeenGroup has released a brand new report, Supply Chain Visibility Excellence: Mastering Complexity and Landed Costs, which uncovers how best-in-class companies: gain insights on Customs events; manage supply chain risk; and attain international shipment insights.
The increased complexity of global supply chains has led to longer lead times, more pipeline inventory, and the need to control downstream and upstream logistics. Recent supply chain visibility research indicates that the top business pressure among supply chain managers is increased supply chain complexity (44%), which contributes to increased supply chain management costs. However, before a company can reduce inventory or landed cost, it needs visibility into international in and outbound shipment status, as well as visibility into Customs event status.
Best-in-Class companies are 61% more likely than all others (the Industry Average and Laggard companies combined) to gain visibility into international outbound shipment status within hours
Best-in-Class companies are 52% more likely than all other companies to gain visibility into international inbound shipment status within hours
Best-in-Class companies are 2.44 times as likely to have Online visibility into the customs events status
Today, the benefits of sourcing from low-cost countries and selling into new foreign markets are driving the vast majority of enterprise-class companies to go global. However, this globalization has led to increasingly complex supply chains with longer lead times, more pipeline inventory, and the need to control downstream and upstream logistics.
Receive this latest eBook from Amber Road, Three Ways You’re Throwing Away Money in Your Global Supply Chain. This expert eBook discusses areas in the supply chain that companies may be losing money, and uncovers strategies to prevent this loss.
Key takeaways include:
How to reduce expedited shipments with better planning and supply chain visibility
How to avoid detention and demurrage fines
How to communicate efficiently with trading partners
Learn how companies such as Abercrombie & Fitch, Glazer’s Family of Companies, and Bunzl Distribution USA have implemented strategies to improve their supply chain operations – download Amber Road’s eBook today!
At last year’s CSCMP conference, Scott Byrnes, VP Marketing at Amber Road, was interviewed by SupplyChainBrain on The Pain and Gain of Global Supply Chains. The video is now live on SupplyChainBrain’s website. Please check it out.
There’s plenty of opportunity for companies looking to globalize their supply chains, but they also must understand the challenges involved. – Scott Byrnes, VP Marketing at Amber Road
New Name Marks Continued Growth and Evolution for Global Trade Management Leader
Management Dynamics, a leading provider of Global Trade Management solutions, today announced that it has changed its name to Amber Road. The name change comes during a year of rapid expansion, marked by a 40% growth in employees, a 325% increase in European bookings, and the opening of a flagship office in Tysons Corner, Virginia. This breakout year is anchored by a 33% compound annual growth rate (CAGR) in overall revenue for the past decade.
“Today, our SaaS-based solutions span fourteen software products that include global transportation management, import/export compliance, supplier management, supply chain visibility and a content knowledgebase covering trade regulations and tariffs for more than 120 countries, “ said Jim Preuninger, CEO.
Management Dynamics congratulates all the companies ranked in the top ten of The Gartner Supply Chain Top 25 for 2011: Apple, Dell, P&G, RIM, Amazon, Cisco, Wal-Mart, McDonald’s, PepsiCo and Samsung. Six of these companies listed use our solutions to automate their global trade management processes.
“We’re proud to be associated with these leading companies and we continue to be impressed by their innovative use of our solutions. The results are a testament to the fact that global trade management solutions, when combined with forward-thinking supply chain strategies, can have a measurable impact on return on assets (ROA), revenue growth, and competitive advantage,” said Jim Preuninger, CEO of Management Dynamics.
According to a recent supply chain survey conducted by Capgemini Consulting, demand volatility was the top business driver for supply chain managers (40% of survey respondents ranked it as number one). This is because although the economy seems to be improving, market demand is still uncertain, making it more difficult to operate a reliable supply chain. In order to counter this challenge, survey respondents are determined to improve the visibility of their supply chains (this ranked as top initiative for 45%).
Supply chain visibility is something that can be easily achieved by implementing an enterprise-wide automated technology solution. A software solution such as Management Dynamics’ allows users precisely monitor the inbound and outbound movement of goods at the shipment, order and SKU level, using over 350 reference points. This level of visibility enables suppliers, manufacturers, retailers and transportation companies to improve customer service and minimize expediting costs by managing inventory in-transit. So no matter how volatile the market is, companies can have complete visibility and control of their inventory levels.
To learn more about how a software solution can improve supply chain visibility, please check out Supply Chain Visibility Excellence: Fostering Security, Resiliency and Efficiency. This new report from Aberdeen Group focuses on gaining visibility into critical elements across the end-to-end logistics network for improving cost and service. Additionally, it takes a look at how Best-in-Class companies are streamlining their supply chains.
Key findings include:
Best-in-Class companies experienced a 3% decrease in supply chain execution cost as a percent of revenue (inbound /outbound transportation, pipeline and staged inventory and SC management costs)
Best-in-Class companies experienced a 3% decrease in total landed costs per unit handled
Best-in-Class companies are between 19% and 42% more likely to respond to non-catastrophic supply chain disruptions within hours.
The increased complexity of global supply chains has led to longer lead times, more pipeline inventory, and the need to control downstream and upstream logistics. In the Aberdeen Group’s most recent supply chain visibility survey, the growing supply chain complexity was the top business pressure (44%). This, in turn, has contributed to increased supply chain management costs. It is not surprising that in the situation of global economic turmoil that visibility is taking center stage.
Aberdeen’s brand new report, Supply Chain Visibility Excellence: Fostering Security, Resiliency and Efficiency focuses on gaining visibility into critical elements across the end-to-end logistics network for improving cost and service. Before a company can reduce inventory or landed cost, it needs visibility into them. Only then can it apply tools to agilely adapt to the information it collects.
A few key takeaways from the report are:
Best-in-Class companies experienced a 3% decrease in supply chain execution cost as a percent of revenue (inbound /outbound transportation, pipeline and staged inventory and SC management costs).
Best-in-Class companies experienced a 3% decrease in total landed costs per unit handled.
Best-in-Class companies are between 19% and 42% more likely to respond to non-catastrophic supply chain disruptions within hours.
The retail industry is challenged with fluctuating customer demand, ever-changing styles and seasonality, and the need to boost top-line growth through store expansion. A streamlined and efficiently run supply chain is a crucial piece of the puzzle when it comes to keeping overall costs down. As pointed out in World Trade Magazine’s article, Timely Ocean Transit for Retailers, inconsistent transit times can drive up total supply chain costs.
[Supply chain inconsistencies can force retailers to] either retain higher safety stock levels, which increases their inventory carrying costs; resort to airfreight to recover from delays, which balloons transportation costs; or use a combination of the two.
While the article references careful carrier selection as a way to ensure timely deliveries, there are GTM solutions out there that can help retailers with all aspects of supply chain and transportation management. By automating the following elements of the global supply supply chain operations, retailers will be able to reduce cash-cash cycles and lower total delivered costs.
Trade Planning
Develop optimal sourcing and distribution strategies by assessing the total landed cost of alternative decisions including product invoice, transportation, duties, VAT, excise as well as evaluating applicable import and export regulatory controls. With a complete picture of cost and risk, shared decisions can be made across sourcing, compliance and logistics functions.
Import Automation
Establish a global import compliance function that integrates all procurement activities. Manage product classification and admissibility reviews to ensure compliant purchase orders are issued. Streamline the entry process to reduce brokerage costs and reconcile entries to resolve issues before they become a costly Customs audit.
Supplier PO Management
Deliver compliant purchase orders to suppliers in a portal that confirms orders, creates invoices, and manages a buyer workflow to build shipments and generate key documents like the commercial invoice and packing list. Efficiently manage supplier compliance and integrate with origin logistics partners.
Origin Management
Manage origin logistics with a portal that coordinates full container load shipments from a supplier and less than container or air shipments. Use a collaborative workflow process to confirm and book shipments as well as collect bill of lading details to facilitate inbound visibility. Enhance compliance with new advanced notification regulations like Customs 10+2 by collecting relevant information at origin.
Global Freight Management Negotiate seafreight and airfreight rates and implement a process for logistics providers and suppliers to book against your favorable rates. Use sophisticated rating tools to optimize carrier selection, pre-rate the booking and automate freight audit.
Supply Chain Visibility
Monitor global orders, shipments and in-transit inventory with a complete event management solution. Use milestone alerting to proactively resolve delivery issues and to trigger supply execution activities such as pickups or warehouse receipts. Use in-transit inventory information to enable postponement strategies and new, direct-to-store delivery strategies. Aggregate all operational data to establish scorecards and manage trade parties with a comprehensive set of key performance indicators.
“Improving visibility” is often one of the top three priorities of supply chain executives to improve the performance of global operations. Here are ten tips to capture the benefit:
1. Accommodate Multiple Fulfillment Models. Visibility solutions need to be highly configurable to accommodate all of the various fulfillment models in operation across the enterprise. Domestic supply chains with three handoffs and a cycle time of less than a week are much different than an international supply chain that involves 12 – 15 handoffs and two border crossings. Supply chain visibility solutions that are flexible enough to accommodate multiple fulfillment models allow benefits to accrue across the enterprise and not within a specific product line or operational model.
2. Create an ‘Information Hub’. Visibility solutions not only extend processes outside the four walls, but must integrate and aggregate key information from within the four walls of the enterprise. The ‘Information Hub’ creates a one-stop-shop for key order, shipment, and inventory information from all internal ERP, TMS, WMS and other inventory planning systems. This expands the number of supply chain processes that can be managed by Visibility and ultimately improves productivity by eliminating ‘sneaker nets’ and re-keying of information..
3. Don’t Assume Data Quality. Aberdeen Research recently conducted a survey and discovered that only 16% of Visibility implementations have data quality above 91%. The other 84% of companies surveyed must clearly be challenged by user adoption. To achieve the value from a visibility solution, users must have confidence that the information is both timely and accurate. State-of-the-art Data Quality Management is comprised of complex rule-based systems to cleanse and standardize information and analytical tools to monitor, troubleshoot and resolve data quality issues using Six Sigma principles.
4. Use a Proven On-boarding Process. Data quality starts at the source and successful Visibility implementations often use an on-boarding service that is based on a careful assessment of information requirements and leverages existing integrations from an established network of transportation, logistics and brokers to certify new connections.
5. Postpone Inventory Allocation Decisions. Many leading companies are using Visibility to track shipments to an SKU level. This allows them to treat the container as a ‘floating warehouse’ to implement inventory diversions through a transload facility or to and to postpone all inventory allocation decisions to just prior to Entry. Given long order-to-deliver cycles, this ability to manage in-transit inventory can reduce days inventory on hand and stock-outs.
6. Push Visibility Back to Origin. Many initial Visibility implementations are based on ‘where’s my stuff’ shipment tracking at a container level. Savvy companies, however, are expanding their Visibility systems by linking orders to shipments and managing in-transit inventory. New CBP regulations such as 10+2 create much more accountability for the importer and kicking off a new wave of investment to push visibility back to the origin. Many of the “10” data elements are related to the supplier, the seller and where goods were loaded – all information that can be collected from origin operations.
7. Finally Manage Trading Partners with Scorecards. The by-product of operational Visibility is a rich repository of supply chain data that can be aggregated across the enterprise and with all trading partners year after year after year. Using leading Business Intelligence tools, scorecards to manage supplier compliance, or transportation booking performance can be easily developed. Since Visibility reduces tactical firefighting, the purchasing, logistics and customer service teams can redirect their efforts to continuously improve global operations.
8. Track Landed Costs Along the Chain. Aberdeen reports that companies that implement visibility are twice as likely to reduce total landed costs over the past two years. Many companies use Visibility to track product, freight and insurance costs as well as integrate trade compliance information such as duties, tax, VAT and other governmental charges. By seeing how costs build and monitoring variances to budget, companies can focus efforts to target cost overruns
9. Use Triggers to Automate Handoffs. Visibility solutions today are evolving from monitoring tools to execution systems. Leading companies are using ‘triggers’ based on supply chain events to plan warehouse receipts, to schedule a pickup, or to alert that the free-time will expire on a container. These triggers create tremendous value by compressing cycle time or helping to reduce the costs associated with demurrage and detention fines
10. Become Your Own 4PL. Visibility is now considered to be a critical and strategic information asset. Leading companies are implementing the infrastructure and deploying new value-added services to their business units and ‘plugging in’ logistics provider partners; in short, they are becoming their own 4PL. The advantage of this model is that all trading partners integrate to one standard and are managed at both a tactical and strategic level. In this way the central logistics team controls all information assets and the delivery of value-add services to their constituents. Perhaps “I am here from Corporate and ready to help” can take on a totally new meaning in your business.
There are many vendors claiming to enhance supply chain visibility, but not all products will advance an organization’s goals. This expert e-book from TechTarget & Management Dynamics defines the supply chain visibility challenge and provides an overview of the different types SCM technologies and solutions available.
Gain a full overview of the many kinds of SCM technology available today
Solve the supply chain visibility challenge
Justify and make the case for SCM technology investments
Understand how compliance is driving the need for greater supply chain visibility
Download our complimentary eBook today, and gain a better foundation for managing your supply chain and improving visibility with suppliers as well as within your organization.
The AberdeenGroup has released a brand new report, Supply Chain Visibility Excellence: Mastering Complexity and Landed Costs, which uncovers how best-in-class companies: gain insights on Customs events; manage supply chain risk; and attain international shipment insights.
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