1977
2015
Hanjin starts
Over 97 container ships moving cargo
April2016 Files for debt restructuring
Many ships wait offshore or return to Korea
$14 billion in goods become stranded
ABERDEENGROUP
SUPPLY CHAIN VISIBILITY:KNOW SOONER, ACT NOW
Explore disruption challenges that all supply chain leaders face and learn how to respond with upstream visibility before they become crises. Source: AberdeenGroup report, November 2016
Disruption is a given and comes in many forms
The key to preventing issues from turning into crises is visibility of the upstream supply chain.
Shipment delayed /damaged / misdirected
Supplier / carrier capacitydid not meet our demand
Product quality issuesleading to recalls
Unexpected customs delays
Port congestion
Port strikes
Environmental catastrophic event
Theft / fraud / security
Percentage of Respondents n=135
The Hanjin Disruption
Aug2016
Sept2016
The Retail Squeeze
Little spent on supply chain execution
Lots of investments into PLM solutions
Better visibility can help in most disruptions
Lack of visibility serious point of weakness for supplier quality and manufacturing
0 10 20 30 40 50 60 70 80
0 5 10 15 20 25 30
27%
25%
23%
17%
13%
7%
7%
4%
Operating with very limited view of inbound supply chains
With so many disruptions and subsequent financial losses, it’s time retailers take ownership and control of their supply chains.
of best-in-class companieshave visibility
85%
58% of all other companies have visibility
Online visibility into internationalorder / supplier event status
Visibility into supplier quality andmanufacturing processes
Best in Class
73%59%
68%30%
Access to inbound supply chain data is needed for better decision making
Top shipment status capability provides enough data for recovery
Data such as product, quantity, and order information helps allocate products for customer orders or inventory for replenishment
With data and visibility Hanjin scenario less of a challenge:Best in Class
>78% access to data
Know from origin to destination
Significant competitive advantage
All Others
<50% access to data
Don’t know where inbound shipments are
Where to begin with Hanjin?
With visibility, best-in-class companies perform better
Perfect orders received from
suppliers
Perfect orders delivered
to customers
Change in average trade compliance
costs relative to declared shipment
value on imports/exports
Total landed costs per unit of import/
export handled
Best-in-Class – 97% All Others – 77%
Best-in-Class – 96% All Others – 75%
Best-in-Class – 1.4% All Others – 9.2%
Best-in-Class – .6% All Others – 6.2%
Visibility pays off in the form of on-time shipments and lower costs.
The Hanjin situation and retail squeeze on supply chain execution improvements are examples of how visibility can be the difference between an issue and a disaster.
Visibility doesn’t solve every problem, but it does enable your organization to know sooner and act now.
© 2016 Amber Road, Inc. All rights reserved.
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