Using Supply Chain Control Tower for Competitive Differentiation
Implement a supply chain control tower and put your worries to rest.
The success of a supply chain is measured by its ability to have the right products available at the right time. Yet many customers lose sight of where products and supplies are once they leave their facility. Some cannot tell where products and supplies are inside their facility. They can’t keep up with the number of problems this lack of visibility causes.
Our Advice
Critical Insight
- The pandemic upended supply chains across the globe. As a result, 60% of organizations are reporting that they have control tower as a top priority.
- A supply chain control tower will also help them with solving their other priorities of supply chain planning, customer order management, and transportation (planning, scheduling, sourcing).
Impact and Result
A supply chain control tower allows organizations to:
- Predict problems across the supply chain.
- Enable real-time information and decision-making capabilities.
- See where goods are and any bottlenecks that may be occurring.
Using Supply Chain Control Tower for Competitive Differentiation
Supply chain control towers are critical decision-making tools.
Analyst Perspective
Supply chain control towers are critical decision-making tools for businesses.
Geopolitical activities are causing economic activity to reallocate around the world and that will lead to new supply chain changes beyond those felt during and coming out of COVID-19. Now more than ever before, businesses must take supply chain visibility very seriously.
Twenty-three percent of businesses believe that supply chain disruption will have a significant impact on businesses in 2023.
A modern supply chain control tower answers the call as a central hub of information that acts as an overarching view into and across your supply chain. It will consider the current state of the supply chain, infrastructure, and the financials across the entire global supply chain network.
The most comprehensive supply chain control towers are utilizing advanced capabilities such as analytics tools, real-time data, and telescopic digital twins that enable an organization's ability to simulate the entire internal and external supply chain process.
Info-Tech's approach focuses on an analyst's investigation of the challenges in the market and feedback about how you can leverage a supply chain control tower for end-to-end supply chain visibility and management.
Kevin Tucker
Principal Research Director, Manufacturing Research
Info-Tech Research Group
Executive Summary
| Your Challenge | Common Obstacles | Info-Tech's Approach |
| You don't have a consolidated view of what's happening across the supply chain network. The CIO must work closely with operations leaders to identify the supply chain gaps.
Finding an effective way to manage the data providers, managers, integrators, and data consumers that will utilize the supply chain control tower. Designing processes and workstreams that deliver value across sourcing, making, moving, and delivery. Identifying the most cost-effective technology direction for establishing a supply chain control tower. |
Complex, proprietary, and resource-intensive legacy applications combined with the challenge of losing institutional knowledge as seasoned resources retire out of the business.
Resistance to change. Staff and operators in supply chain have often grown accustomed to the existing solutions and don't see the value of changing. Acquiring new skills. Hiring for new advanced capabilities has become difficult due to rapid market shifts to new technologies and a slowness to educate. Network reliability and integration for seamless live information sharing across the control tower. |
Improve your supply chain visibility by using this research to understand the needs of the business and how control tower tools can help.
Use our tools to structure your evaluation and demonstration process for selecting the best tools for your business needs. Adopt a capability-based approach that considers a holistically interconnected environment for end-to-end visibility of the supply chain. We work closely with our customers to provide both strategic and tactical decision-making advisory services. |
Info-Tech Insight
Supply chain management is one of the most complex roles in an organization, however, there are tools that are designed to provide you with end-to-end visibility and enable rapid decision-making at the time that you need it most.
What is a supply chain control tower?
The concept of a control tower is commonly associated with an airport control tower. A supply chain control tower (SCCT) is a similar concept. It is a central hub of people, processes, data coupled with visualizations, and analytics technologies that capture and process supply chain data for short- and long-term decision-making.
The goal of a supply chain control tower is to capture real-time integrated supply chain data from across all touchpoints to enable enhanced visibility that can then be utilized to optimize supply chain through improved collaboration and information for making informed decisions. The primary goal is to make all points in the supply chain environment visible to the enterprise.
Source: Data Labs India, 2020; Edureka, 2022.
You need visibility in your supply chain control tower to prepare for today and your future needs
We can't predict when and if another event like COVID-19 may occur, but we can plan for the risk.
92% Kept Spending During COVID-19
Investment in technologies continued during the global pandemic despite, or as a result of, supply chain disruption.
64% Accelerated Digital Transformation
Digital transformation has accelerated and with it comes the need and the benefits of having a supply chain control tower.
57% Had Serious Disruptions During COVID-19
COVID-19 had both positive and negative impacts on businesses, with many experiencing serious disruptions to their supply chain processes.
85% Increased Attention on Environment
Businesses have increased their focus on environment, social, and governance supply chain solutions.
Source: "Is your business prepared," EY, n.d.
Supply chain disruptions increased worldwide between 2019 and 2021
Note: There was a significant uptick in worldwide events, causing an increase from over 6,000 supply chain disruptions in 2020 to 11,642 in 2021.
Source: "Number of supply chain disruptions worldwide," Statista, 2022.
North America experienced an astounding 47% of all supply chain disruptions
Note: Europe and Asia together experienced around 42% of the global supply chain disruptions.
Source: "Share of supply chain disruptions worldwide in 2021," Statista, 2022.
Significant challenges in storage and IT services were experienced across the supply chain
Note: These results show feedback from 350 respondents across the UK and the US in 2022. There appears to be no letup for the foreseeable future.
Source: "Storage and IT-services affected by supply chain challenges 2023," Statista, 2023.
The global supply chain pressure index shows unpredictability across the years
Note: Due to the relatively stable index scores prior to 2017, many companies had a false sense of security and were unprepared for the challenges brought on by the pandemic and the unrest across the world.
Source: "Global supply chain pressure index 2022," Statista, 2022.
COVID-19 hit hard, but next time you will avoid the punches by using a supply chain control tower
"Everybody has a plan till they get punched in the mouth."
– Mike Tyson
Supply chain planning is an information-driven process. The more information you capture from across your sources, the more effective you will be at using it to avoid problems. Implementing a supply chain control tower that captures your operations, logistics, materials and financial information will only achieve results if your team has skills to prepare the data for cognitive responses such as: What happened? What's likely going to happen now or in the future? What actions need to be taken to exploit or avoid it?
This will ultimately help you make reliable decisions and avoid catastrophes.
Source: "Building the Superstar Retailer," o9 Solutions, 2023.
Control tower capabilities are the top priority for shippers and third-party logistics providers
Note: Graph shows the results of a global survey among logistics and supply chain executives in July 2021 asking respondents about the most important IT-based capabilities a third-party logistics (3PL) provider must have.
Source: "Shipper views," Statista, 2021.
Actions to address supply chain problems in 2023 differ by business size
Note: Larger businesses are focusing on dealing with skyrocketing costs of getting equipment quickly while small businesses are trying to optimize what they currently have in place. A supply chain control tower provides visibility to enable priority-based decision-making.
Source: "Actions taken," Statista, 2022.
Don't take our word for it – here are some needs as expressed by our customers
A supply chain control tower must deliver a wide spectrum of capabilities.
| Feedback from Leaders at Three Companies | ||
|---|---|---|
| Rapid integration of M&A data into the control tower | Persistent risk management enables proactive management | Security at the forefront of our consciousness |
| Demand and supply planning | Integrations are vitally important | Regulatory compliance needs to span every touchpoint |
| Comprehensive toolkit for self-service configuration | Getting funding and support requires a lot of effort | Being targeted by hackers has forced more discipline |
| Sales and operations analytics | Environment, social, and governance is gaining importance | * Information for counterfeit, black, and grey market products |
| ERP integration | Need to have GovCloud support and compliance | Government compliance such as country of origin on materials |
| Analytics drill down into product family groups | Should be able to capture risk data from third parties | Policy workflows that match the team charters |
| Long-range forecasting | Clean data is core to successful supply chain | Global trade visibility for procurement |
| Portfolio, demand, and management review | Don't underestimate effort to address resistance to change | Built-in policy checks for sourcing and deployment |
| Methods for onboarding, training, and admin of power users | COVID-19 helped elevate the need for clean master data | Automation that spans internal and suppliers' agreements |
| ERP data pull and scheduling of material requirements | Inflation is a problem that can be tempered by control tower | Integrations across homegrown and off-the-shelf solutions |
| Snapshots to demonstrate point-in-time decision support | Proactive outreach and training are necessary for smooth adoption | Biggest savings potential in source-to-contract procedure reduction |
| Tools to see and reduce costs such as expedited goods | Partner adoption can be difficult if value hasn't been demonstrated | Important to have a supplier helpdesk |
| Modeling and simulation | Big savings potential in automation supporting source-to-contract | Bad data doesn't clean itself |
| Constraint-based inventory review by ABC class | Support control tower with an internal and external helpdesk | It's a dicey world where some push back on digitalization |
* Grey Market: legitimate goods sold through unauthorized channels. Counterfeit Goods: phony products that are unauthorized copies of the real products. Black Market: products that are illegal to produce or sell.
Source: Cal Micro Recycling, 2023.
There are different kinds of supply chain control towers to consider
The supply chain control tower needs to be a network of trusted partners engaged in sharing.
| TYPES OF CONTROL TOWERS | FUNCTION |
|---|---|
| Inventory Control Tower | Responsible for the oversight of all stock levels across the supply chain with the goal of avoiding stockouts. This can be very complicated depending upon how centralized or decentralized the company is. This will in turn impact the decision-making speed and/or duplication of effort. The balance between control and autonomy across locations must be carefully considered. |
| Logistics Control Tower | Monitors and tracks shipments, identifies issues, manages inventory levels, and creates transparency across the supply chain so that all stakeholders can see where goods are in order to take action to avoid delays. |
| Operations Control Tower | Provides oversight to optimize day-to-day operations within the supply chain with real-time inventory, reorder points, response to demand spikes, tracking quality issues, and maintaining financial efficiency. |
| Transportation Control Tower | Enables real-time monitoring for asset usage, load optimization, capacity management, contracts/rates, carrier partnerships, and the planning and routing activities. |
| Analytical Control Tower | Maintains and reports upon a series of key performance indicators and metrics across the entire supply chain network. |
Source: OMP, 2020; Edureka, 2022.
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