Why Are Supply Chain Transparency and Traceability Important for a Business?
Pressure for Transparency: SMEs and companies across industries are under immense pressure to gain visibility into their supply chains.
Consumer Interest: 72% of e-commerce shoppers consider transparency important in purchasing decisions.
Best Practices for Honesty: Green businesses need transparency in marketing and traceable supply chains.
Understanding Supply Chain Transparency
Definition: Transparency involves capturing and sharing high-level information throughout the supply chain.
Benefits: Enables full supply chain mapping, increases the visibility of economic operators, and ensures compliance with sustainability, safety, and social responsibility.
Example: A company publishes their supplier list and periodic reports showing progress.
What Is Traceability?
Definition: Traceability gathers detailed data about individual components or ingredients, such as batch-lot data or purchase order information.
Process: Tracks the location and provenance of products and materials from start to finish.
Benefits: Identifies supply chain efficiencies, meets regulatory requirements, and informs consumers about the product journey.
About Supply Chain Mapping and Its Benefits
Definition: Mapping creates a complete picture of organizations and companies within the supply chain at every tier.
Benefits: Prioritizes suppliers and actions, supports risk assessment, and creates interactive visuals while respecting confidential trading relationships.
What Is Supply Chain Visibility, and How Does It Relate to Transparency and Traceability?
Definition: Being aware of each touchpoint within the supply chain.
Benefits: Collecting and sharing more information with customers and stakeholders reduces risks and enhances overall performance.
Key Components: Transparency, mapping, and traceability contribute to building a resilient supply chain.
Challenges Associated with Supply Chain Visibility
Data Collection: Requires a system to share data and information between various supply chain tiers.
Control Loss: Lack of visibility can lead to loss of control over the inbound supply network.
Data Focus: Knowing which data to focus on and which to ignore.
Why All These Elements Are Important for a Business
Supply Chain Visibility: Improves workflow, increases profits, reduces costs, and anticipates risks.
Agility: Provides the ability to act quickly and make necessary changes to enhance productivity.
Customer Needs: Full visibility allows adjustment to meet customer demands, increasing operational efficiency.
Building a More Visible Supply Chain
Employee Versatility: Employees should be versatile from top to bottom.
Technology: Good technology enhances the visibility of supply chain operations.
Training and Workflow: Training employees and focusing on workflow help uncover critical decisions.
Summary
Key Concepts: Traceability and transparency are key to effective supply chain management strategies.
Main Benefits: It helps establish supply chain visibility, which is crucial for improving business performance and addressing social and environmental issues.
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