It eliminates human errors, automates workflows, predicts important events and eventually provides full visibility in a supply chain; a Control Tower, which we will discuss below, is an all-in-one solution for smart supply chain management.
Technology offers a broad spectrum of solutions to address many business challenges. So far, the most comprehensive digital tool to improve visibility across the supply chain is the Control Tower.
When properly implemented, a Supply Chain Control Tower greatly increases supply chain performance.
In this article, you will learn more on:
- What is the Supply Chain Control Tower?
- Areas of supply chain management supported by Control Towers
- Data gathered by Control Towers
- Benefits of Control Towers for business management
- What can supply chain teams do with Control Towers?
- What are the types of Control Towers?
What is a Supply Chain Control Tower?
Are you familiar with a building of a flight Control Tower? Probably yes. Media often use this image to present the Supply Chain Control Tower. But in fact, this is only a vague representation of an idea.
So, what is the Supply Chain Control Tower, actually?
It is an agile cloud platform gathering all the information needed to create end-to-end visibility in a given supply chain.
To put it simply.
The Control Tower is an information hub.
It gathers and displays real-time data in an insightful manner. Collected data are processed and supported by context. That way a company using the Control Tower can analyse its current situation or predict the nearest future, and – quite often – also act upon this information right in the system.
And to speak a business language: by using this central hub, the company obtains visibility and orchestrates logistics activities.
Okay, many smart words but the Control Tower’s image is still blurred to me, you could say.
Let me be more specific then.
First, we will understand how this information hub helps to run a business.
Control Towers monitor, control and support supply chain management on three levels
There are three aspects of the daily management where Control Towers help.
- A strategy. The Control Tower ensures control over the entire supply chain network and provides insight into how to reshape it for greater benefits;
- A tactic. The Control Tower enables proactive planning of orders and distribution according to the market demand and accessible logistics resources.
- Operations. The hub supports a variety of real-time functions and decisions, including transportation management, inventory tracking, and event management.
So, exactly what kind of information does the Control Tower processes and how can a supply chain manager and the business benefit from incorporating it?
First, let us talk about data.
Data gathered by the Control Tower
The Control Tower is a digital tool to collect, select, process and visualise with a context a large amount of data at different levels of granularity. Having said that, you can imagine that there can be a variety of data provided to the hub.
- Information from ordering systems
- Statuses from 3PL partners,
- delivery schedules,
- inventory information from all internal ERP, WMS and other inventory planning systems,
- IoT data,
- exceptions, etc.
There are many sources of information that one can provide, and they all depend on your visibility needs in a given supply chain. I strongly recommend this article from Forbes about what is and what is not a Control Tower.
Three pillars of effective Control Towers management are:
- People – provide expertise for planning, execution and optimisation of product movements
- Processes – meaning the orchestration of the Control Tower functions
- Technology – information repository with data analytics and decision support functionalities
Three pillars of the supply chain visibility Control Tower; Source: Capgemini
Benefits of Control Towers in supply chain management
The two major things that add value to supply chain management through the Control Tower are: big data and real-time analytics. Once a company puts in the effort of that digital hub implementation, it pulls out some real benefits.
Having end-to-end visibility allows you to spot and eliminate risks, such as a dependency on one supplier or inventory shortages.
The same goes with recognising rising costs of, e.g., processes. Real-time analytics and the context they provide are a powerful duo in reducing or optimising costs.
Responding to and resolving supply chain disruptions in real-time
Crisis situations come in many forms. For instance, the pandemic of COVID-19 shook the world. And during hard times, companies should rely on one central unit that makes the decisions. The Control Tower, with real-time tracking & tracing, its analytics and visibility charts, is an ideal solution to inform actions in a fragile situation.
Tracking important fleet, shipment or assets metrics
If you consolidate IoT devices with the Control Tower, you can track metrics such as fuel consumption, vehicles acceleration and location, parts exploitation, shocks on shipments etc.
Estimating delivery time
With a properly configured analytics interface, and especially with machine learning algorithms, you can estimate delivery time with high accuracy.
Forecasting and decision-making
Using data for your company’s advantage is easier when you have all the information in one, collaborative place. It is important that you can see the data settled in the context to draw accurate conclusions and support your decisions with facts, and not hunches. If you are using also predictive analytics, you can act proactively to make most of the upcoming chances or counteract disruptions.
Providing end-to-end supply chain visibility to all stakeholders
The overall goal of introducing a Control Tower to a company is to obtain end-to-end visibility. By providing a 360-degree view, Control Towers become powerful tools to run a business more effectively and generate savings at the same time.
Providing cross-organisational collaboration
By merging data from, e.g., logistics service providers and suppliers, a Control Tower enables a company to work with business partners in real-time, and solve a broad range of problems.
The same goes with internal collaboration. The Control Tower offers better alignment and cooperation between different functional units of your own organisation.
Supply chain visibility and types of Control Towers
If you are considering incorporating a Control Tower to your company, you should be aware of the main types and usages of these applications.
And one other thing.
Important! Some tech vendors are also calling their digital products Control Towers, but it is important to know that they do not provide solutions with operational modes. These solutions will have an analytical mode, but you will not get the possibility to take action on the provided data.
But coming back to the main thought.
Supply Chain Control Towers should be differentiated based on their functionalities and areas they support.
- Analytical Control Towers that only show data;
- Operational Control Towers that give the user both, analytical and operational possibilities;
- Transportation Control Towers covering shipments visibility and a freight consolidation area;
- And Supply Chain Control Towers where customers, suppliers, transporters, warehouses, shipments etc. are taken into consideration.
What can supply chain managers & organisations do with a Control Tower?
Another interesting aspect is questioning the possibilities of a Control Tower.
So, what can supply chain managers do with it?
First of all, generate comprehensive reports. In no-time, you are able to, e.g., discover the total landed cost of every product ordered, or even spot costs trends.
Secondly, predictive analytics dashboards will be handy when a company wants to overtake the future and order products in advance.
Thirdly, there is the visibility aspect. If you cooperate with many third-party logistics companies, you are able to evaluate them by, e.g., comparing OTD performance.
Reports, predictive analytics and visibility parts give you the possibility to take further actions.
And to end with something equally useful, a Control Tower is serving as a book of records. It captures and stores information about orders made, shipments shipped, documents created etc.
Okay. Now when everything is already clear, we can summarise the knowledge.
A Supply Chain Control Tower is a comprehensive cloud platform that collects, selects, analyses and visualises data from different sources, while at the same time providing a context to optimise processes.
In short: it is a tool to orchestrate management, optimise processes and provide predictions. This digital hub enables end-to-end visibility across the whole, even the global supply chain.