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COVID-19 has increased the demand for supply chain visibility

Jan Tore Pedersen | 25. May 2020
4 minutes read

COVID-19 has caused major damage to global supply chains. Almost 60% of supply chain professionals said that their operations were significantly affected in a survey conducted by Shipping and Freight resources. Lack of information creates chaos and it has become clear that end-to-end visibility and digitalization are crucial when dealing with disruptions.

Without having the right knowledge about your operations, you cannot predict or react to unexpected events. This often results in higher costs than necessary and inefficient use of resources. In a global crisis, supply chain visibility becomes crucial to understanding the impact of the disruption, and how it will affect you and your stakeholder’s business.

How has COVID-19 affected logistics?

  1. Logistics operations are disrupted. Terminals may be closed, the same goes for borders. Certain regions may be completely closed for transport.

    In order to react to such incidents, it is imperative that you have a complete view of your entire operation. This means having the overview of the movement of resources and cargo. It is too late to start trying to get information once operations are disrupted.
  1. When certain areas are infected, you need to be able to avoid those. But equally important is knowing if people, equipment and cargo have been in such areas, so that you may take appropriate actions.

Dealing with such situations are never easy, but they are close to impossible to handle if you do not have updated information at hand continuously. Hence, ensuring visibility of cargo and resources should be a no-brainer now that we have seen COVID-19´s effects on logistics.

Prof. Rod Franklin of the Kühne Logistics University has stated that “the future supply chain will not be like your father’s supply chain”. 2020 has made this clear and one thing is for sure: We need to know what is going on the make the right decisions.

How achieve full visibility?

Visibility is more about process than technology. A large number of companies are offering technology for recording the movement of vehicles and goods. IoT (Internet of Things) devises are among those currently being heavily promoted.

However, technology will only help if the solutions are being used in the proper context.Visibility starts by making sure that all transport units (the units that are carrying the cargo) are uniquely identified, whether it is parcels, pallets, big ticket items like furniture or appliances. One way to implement identification is to use the GS1 Serial Shipping Container Code (SSCC). This code can be used independent of how you want to label transport units. Other alternatives can be barcode labels or IoT devices.

The second step in the process is to record when transport units are loaded onto other transport units (parcels onto pallet and pallets into containers). The third step is to record when transport units are loaded into a vehicle and then monitor the movement of the vehicle. When a vehicle arrives at a terminal, the process continues by recording discharge and possible splitting of transport units, and then the process starts over until cargo reaches its destination.

By recording all these activities digitally, you can easily present the status and prognoses for estimated times of arrival and location to shippers and other logistics operators that are involved in moving the cargo.

shipping an freight resource

Conclusion

Supply chain visibility offers your business major benefits and together with digitalization, you will be better prepared for the next global crisis. But supply chain visibility is not only useful in a crisis. It should be a top priority even after we overcome the pandemic and these challenges. According to the Shipping and freight resource survey, using technology to close the visibility gap is a top priority for many going forward. 

It is time to improve the data flow, increase flexibility and transparency of your supply chain, to become more resilient for future disruptions!

 

digital logistics


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