Visibility into all facets of the supply chain is key for any successful supply chain management. However, supply chain leaders are often inundated with so much information that it can be difficult to keep track of it all. Supply chain mapping is often applied to projects in order to blend transparency with organization, but those in management must understand how to effectively leverage this tactic.
Defining Supply Chain Mapping
Suppliers play a critical role in every facet of the supply chain but especially manufacturing. For manufacturers to comply with regulations, they must be able to trace each item to its origin. Having multi-tier suppliers makes this effort challenging, as manufacturing plants may be forced to communicate through tier one suppliers to acquire information from tier two suppliers and so on.
Supply chain mapping allows for a more organized and holistic view in this endeavor. According to Just-Style, supply chain mapping is a strategy that promotes collaboration and shows ties between suppliers, manufacturers and other stakeholders. There are many different types of solutions for this approach. For instance, some services provide visual representations of supplier connections that require companies to enter their own data. Meanwhile, other solutions solicit information from tier one suppliers so manufacturing experts don’t have to go digging for the data themselves.
Benefits of Effective Supply Chain Mapping
Supply chain operations are anything but stagnant. Between shifting consumer demands, constant developments in technology, changing regulations and improvements in supply chain management, processes and partners are bound to vary over time. Supply chain mapping devices that utilize automated data collection paint the most current picture possible for stakeholders. This ensures those in supply chain management aren’t continuing outdated procedures or relying on inaccurate information, increasing efficiency and avoiding costly errors.
Alternatives to supply chain mapping solutions are often paper-based requests for information. These practices are insufficient to keep up with the fast pace required for supply chains to remain successful in today’s market. Plus, there is no way for them to account for data changes. Manufacturing professionals would have to issue a new RFI on a regular basis to stay on top of adjustments, which can cause issues with organization and accuracy.
Having effective supply chain mapping tools is also integral for mitigating risks and adhering to trade regulations, especially at a global scale. A recent news report from U.S. Immigration and Customs Enforcement highlighted what can happen without adequate supplier tracking.
ICE, Homeland Security Investigations, Bureau of Alcohol, Tobacco, Firearms & Explosives and the Department of Defense-Defense Criminal Investigative Service had been investigating the trade practices of Sabre when the organizations uncovered evidence of illegal activity. Four executives from the company were found guilty in 2011 of unlawfully exporting firearm parts and received sentencing in August 2016.
Not only did Sabre violate the Arms Control Export Act by not securing authorization from the U.S. Department of State when sending military weapon components abroad, but the executives tried to cover up the ordeal. According to ICE, from 2003 to 2009, Sabre falsified shipping documents, used false bottoms on crates and lied on business records.
While Sabre executives made deliberate unlawful actions, this example still highlights the consequences of violating the Arms Control Export Act – even accidentally. The four men involved in the incident had sentences ranging from 13 to 18 months in prison because of this incident.
All too often, companies do not put enough value on trade compliance. Relying on simple Excel spreadsheets won’t give brands the insight they need to ensure they adhere to regulations, which is why supply chain mapping tools are so important.
How Supply Chain Management Can Practice Better Mapping
Even if brands do not have adequate inventory tracing capabilities, there are steps they can take to move in a more positive direction. The Chartered Institute of Purchasing and Supply offered several mapping improvement tips.
For one, those in supply chain management must make visibility a priority across all supplier tiers. To do this, companies must have data collection solutions that assemble information from the entire length of the supply chain. Once organizations have this data, they can then adequately map out the roles of each supplier. It is not enough to allow tier one suppliers to manage tier two suppliers – brands that want to stay compliant, boost efficiency and contain costs must initiate projects that align all stakeholders.
That said, businesses can still rely on tier one suppliers to pull tier two constituents into the collaborative effort. As CIPS explained, companies must request tier one suppliers to invite their partners into the project, who will invite their suppliers and so on. To nurture these connections, organizations can call on automated data collection, which will demonstrate how each party impacts the others. This transparency allows all stakeholders to identify risks and come up with better strategies.
Having a visual representation of this information is integral for supply chain mapping success. According to SupplyChainBrain, the The Supply Chain Risk Management Consortium advised using a links and nodes approach. With this strategy, nodes represent supply chain entities, such as suppliers and customers. Links are drawn via lines between nodes to portray funds, services, materials or information transfers. With the advanced automated data collection tools, those in supply chain management can adjust the map to reflect current configurations.