In our highly connected digital world, supply chain visibility involves more than just your standard track and trace technology. While once considered ‘cutting-edge,’ the ability to know the physical location of freight should be a given for any shipper of any size. Today, when progressive shippers think about terms like visibility and transparency, their expectations include having a view of their entire supply chain, from sourcing to manufacturing to final delivery, irrespective of the number of suppliers or logistic providers.
The importance of visibility to a large extent is about problem avoidance and mitigation. Companies can’t wait for problems to snowball through their supply chain operations, because by the time they’ve been identified, it’s often too late. The extra costs and disruptions have already occurred whether you realize it or not. If you want to avoid delivery challenges before they make their way downstream, you’ll need a way to increase transparency further upstream prior to when the shipping process even begins.
Solving the Supply Chain Puzzle To Prevent Late Deliveries and Extra Logistics Costs
A key step in the supply chain where these types of problems can be addressed relates to how Purchase Orders (PO) are managed. Paper-based PO processes and primarily manual workflows can leave most supply chains vulnerable to problems that only really manifest themselves during shipping.
Identifying when production delays and orders shipping incomplete or late will impact transportation plans is exceptionally difficult, especially when sourcing and manufacturing are happening overseas. To be successful, shippers have to adopt tools that are sophisticated enough to handle the complexity of global supply chains. This is where tech-enabled PO management is a critical piece of the supply chain puzzle.
The best digital PO management solutions will automate and align a company’s manufacturing and shipping operations from end to end by allowing issues to be addressed upstream before they have a chance to become issues downstream. This eliminates the need to manually mine through fields of data to identify problems.
In other words, close alignment between a company’s PO management processes, supplier manufacturing schedules, and the shipping function creates a win-win-win situation.
There are several important and quantifiable benefits of tech-enabled PO management including:
• Expedited shipping expenses lowered by 15-20%
• Extraneous email traffic reduced by more than 80% almost instantly
• Overall freight costs decreased by 20%+
Additional supply chain efficiencies:
• Improved transportation budgeting with better control over costs and accuracy
• More optimized title transfer and inventory management
• Integrated cross-functional collaboration and more accessible data
• Standardized PO processes
• Improved vendor relations
• Data-enabled score carding
Purchasing and procurement professionals have a lot on their plate, from ensuring contractual compliance to overseeing vendor communication. Unfortunately, the chances of experiencing delays with your purchase order requests are a lot higher when you’re forced to wait around for phone calls and email responses, or you’re having to wade through various outlets to pull data on specific assets. And, like it or not, keeping the shipping department ‘in the loop’ can often slip down the priority ladder.
Running a Tighter Ship
With a centralized web-based PO management software system that corrals all communication, companies also lower the risks associated with miscommunication and error-filled POs. Also, by having an intuitive traffic-light filtering system, users will be able to quickly focus on addressing the real issues rather than data-trawling to try and find them. The key to effectively solving these challenges is visibility throughout the entire supply chain.
While some ERPs claim to do PO management, none of them do it very well. It’s important for shippers to find a solution that can help them lower costs, optimize supply chain performance, and gain a competitive edge. And remember: the alignment of PO management, shipping department, and all stakeholders is the key to a synchronized supply chain.
To learn more about a collaborative online PO management platform that provides immediate visibility and opportunities for continuous improvement with an innovative carrier-agnostic approach, visit Jaguar Freight.