The challenge of managing complex global supply chains in an increasingly volatile business environment has companies searching for processes to make their supply chain more flexible and efficient. A well-managed supply chain provides them a competitive advantage and increased profitability. As outsourced supply chain professionals, logistics executives are tasked with meeting our customers’ growing needs and recognizing and reinforcing growth opportunities, while reducing or eliminating risk in our customers’ operations. How, then, do we establish a practice in doing so?
The challenge of managing complex global supply chains in an increasingly volatile business environment has companies searching for processes to make their supply chain more flexible and efficient. A well-managed supply chain provides them a competitive advantage and increased profitability. As outsourced supply chain professionals, logistics executives are tasked with meeting our customers’ growing needs and recognizing and reinforcing growth opportunities, while reducing or eliminating risk in our customers’ operations. How, then, do we establish a practice in doing so?
A solution that has been gaining momentum recently is the transparent supply chain process referred to as Control Tower. Control Tower acts as the supply chain nerve center, utilizing technology, organization and processes that capture product movement visibility from the supplier all the way to the customer. It allows the 3PL customer to collect and use timing, efficiency and service data in real time for short- and long-term planning and decision-making, and it assists them in aligning and realizing strategic objectives. The customer becomes engaged in the entire process across multiple domains, at a level of involvement that caters to the company’s needs.
The flexibility of Control Tower is key to the service it provides. Its role or focus can change according to the individual needs of a supply chain customer. It is very much a concept of scale; it can be part of the solution or all of it. The real-time analysis of data enables supply chain managers to immediately address questions or issues that occur unexpectedly. They can detect what is happening and determine best practices for response. Additionally, they can identify trends and anticipate potential issues that may arise in the future. The data collected allows them to analyze opportunities, mitigate risk and formulate response strategies. Simply stated, Control Tower gives customers the information they need to make informed decisions by utilizing pure visibility of daily services and tactical administration.
Standardization is another key component to the partnership with an established 3PL that is regionally knowledgeable and able to select the best provider for a specific customer. The ability to tap into a particular supplier or service provider’s database creates an operating procedure that gives the customer a look and feel that is very standard. Globally speaking, Control Tower uses a standard operating procedure that translates across multiple bases. Corresponding with a base located in Asia would be exactly like communicating with one in Europe or the U.S. The value here, of course, is that one system and one process are being managed in a way that is standard across the flow of the supply chain.
The most vital Control Tower component is the coordination of activity along all aspects of the supply chain. Improved visibility increases the customer’s knowledge across all domains: manufacturing, inventory, demand, transportation, customs clearance and service — all aspects involved in the day-to-day operations.
For example, at the local level, a 3PL customer can coordinate with the carrier that makes a pickup, while at the same time communicating with the supplier to determine the availability of material for pickup. The customer is able to interface within the system to monitor the process from beginning to end. The customer can coordinate with port compliance for export documentation, ensuring that all paperwork is available to the customs broker for clearance. Shipments can be tracked and traced upon arrival, and required information is made available to the inbound customer’s broker for clearance.
Along with coordination, end-to-end visibility also provides the opportunity to catch and manage a potential crisis along the supply chain. Sometimes issues pop up and decisions need to be made quickly. For example, suppose a shipment is travelling LTL, and it unexpectedly becomes “hot” en route and has to be diverted — possibly going by air — in order to get to its destination faster due to a production need, or it may even need to go to a new destination. The coordination and management necessary to execute such changes require the visibility of Control Tower.
Many companies find the concept of establishing a supply chain Control Tower system daunting. This is where the value of partnering with an experienced 3PL comes into play — especially a 3PL with Lean principles embedded in its culture.
Lean is an underpinning concept for Control Tower and a central component of its culture. Control Tower makes for a more reliable supply chain, while Lean helps achieve the end goal. The end-to-end supply chain visibility and transparency provided by Control Tower, combined with the Lean culture of continuous improvement and long-term success, produce coordinated, orchestrated execution and sustainability. A 3PL that is truly dedicated to Lean principles will play a major role in meeting its clients’ goals and objectives and will provide value, savings, continuous improvement, elimination of waste and a Lean mindset in every aspect of its clients’ plan. At the end of the day, the extensive background, expertise and sustainability that Lean brings to the table, utilized as a key element in Control Tower, will allow companies to successfully manage the complexities of today’s supply chains and gain a competitive advantage.
Menlo Logistics’ Mike Greene, Vice President, Operations, and Nick Caragher, Senior Director, Transportation, have a combined 47 years’ of industry experience between them, half of which has been with Menlo. Both are responsible for the development of sales and solutions for the company’s Transportation Services — which includes overall Menlo Transportation Management Strategy, Procurement, and the systems that enable the organization and their customers.
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