Decision making across the supply chain

Logistics is all about getting the right products in the right place at the right time in the most efficient way possible. At its heart, it involves making decisions about when and how to move products through the supply chain.

So how does an organisation make those decisions? Foundational to good decision making is having the right information – both the data and the visibility of it. But the reality is that it is not a simple process to get these foundations set up. And it is not something that you can achieve all in one hit. It’s an incremental process. It’s a journey.

Getting started

If you are just starting off on the journey, assess where you’re at currently and identify your pain points. Then, build your organisation’s capability to address those pain points or gaps, and apply it to your situation. Take the win before moving onto the next pain point or use case. This is a journey of stepping from capability-building to implementing use cases, building insights, and using them as you go.

A framework for insight-driven logistics

For effective insight-driven logistics, we can utilise a framework consisting of four key pillars (visibility, flexibility, collaboration, and control) that are supported by three enablers (organisation and talent, processes and data and technology), tied together with effective governance. Each of these components has a role to play in creating insights, making decisions, and informing action across the logistics chain.

Below are the key steps involved in putting these components in place for effective insight-driven logistics. 

Set up a strong governance structure. The role of governance is to oversee the supply chain ecosystem, helping an organisation to navigate towards more insight-driven logistics and realising the associated benefits, while keeping an eye on risks, data quality, security, and compliance.

Implement the three key enablers:

• Organisation & talent – Having the right people in the right roles is essential.
• Processes – Good, documented processes lead to consistency and quality, eliminating confusion.
• Data & technology – It can be easy to focus solely on this  , but it is important to remember that this is just one enabler to good decision making.

Embed the following pillars into your organisation, starting with your most pressing pain points.

• Visibility – Connect the data required to address the problem   and have tools   in place to create visibility and extract insights, such as, dashboards.
• Flexibility – Set up reports, alerts, and processes, so that disruptions   to the standard process are quickly identified and escalated to the right people.
• Collaboration – Collaborate with key stakeholders that are involved with or impacted by this issue for better, more impactful troubleshooting.
• Control – Set up policies and processes so that there is clarity on what to do and how to do it, for example, specifying the frequency of reviewing aged inventory and documenting the process for the review.    

Measuring results

How do you know if it is working? Create feedback loops and insights, supported by mechanisms like visual dashboards and control towers that allow performance, outcomes, and benefits to be surfaced to governance and sponsors.

Moving forward

Insight-driven logistics is all about going on a journey to get the right information to improve decision making. The pathway forward is an iterative approach of building capability to address a particular pain point or use case, and then implementing that use case and securing the benefit. Then, repeating the process again with another use case, and so on.

For more about insight-driven logistics, take a look at our 2024 Ports and Freight Yearbook here.