Supply chain control tower in SMBs

The role of a control tower in the supply chain is to extend an umbrella over all operations in the warehouse management area, transportation, and logistics to close up — or better yet, secure — the supply chain. Its role as a business unit has its own specifics, which involve delivering better insights on KPIs, proposing corrective actions, and streamlining operations among stakeholders.

Keeping an eye on the business is crucial from a holistic perspective. Deloitte says that despite the clear desire to prioritize the digital supply chain, only 6% of supply chain leaders feel they have the necessary visibility. This outcome brings the role of the control tower in the supply chain even closer.

For many, it can be clear, but it is essential to highlight that there are several different meanings behind the term "Control Tower." How it looks depends on the scale and type of your operations. When it's a small business, there is no strict need to facilitate a control tower because its operations are too narrow. However, whether it is SMBs or enterprises, in both cases, companies need to use the capabilities of supply chain control tower (SCCT) software that can help them better tackle business challenges.

This article is about that. We share our experience and illuminate our knowledge of SCCT to help you better understand the specific role of the control tower's business unit.

What is a control tower?

A control tower (CT) is a centralized hub that offers enhanced visibility and control over supply chain operations. It acts as a nerve center, gathering real-time data from various points along the supply chain. Moreover, it provides comprehensive insights into the performance of key metrics. The CT enables businesses to monitor, manage, and optimize their supply chain processes more efficiently.

When we talk about the control tower itself, it refers to a business unit. Its role often concentrates on managing warehouse operations and transportation. For example, many might find it interesting to say that more warehouses mean better service, but in fact, this increases supply chain costs (up to 8% per additional warehouse) due to reduced economies of scale and lower productivity. On average, companies need significant productivity gains (85% to reach the top quartile, 70% more for pole position) to offset these costs. The insights from McKinsey show that the control tower helps balance these results among all stakeholders to avoid jeopardizing the business.

When organizing a control tower for the supply chain, companies focus on several responsibilities:

Strategic supply chain management. Contribute to the development and execution of supply chain and network strategies, including network design, capacity planning, and risk management.

Centralized process management. Oversee and optimize key supply chain processes, including demand and inventory management and analytics, planning hub operation, transport coordination desk, and trade compliance.

Get greater supply chain visibility with advanced technologies: 

• Collaboration and coordination. Work closely with decentralized operational units to ensure alignment with overall supply chain strategy and performance targets. It includes facilitating communication and collaboration between units.

• Performance monitoring and improvement. Monitor key performance indicators (KPIs) and identify opportunities for continuous improvement. Develop and implement corrective actions to address performance gaps.

• Project management. Lead or participate in supply chain projects to improve efficiency, reduce costs, or enhance levels.

• Logistics service procurement. Contribute to the procurement of logistics services, ensuring cost-effectiveness and the fulfillment of service level agreements.

• Standardization and best practices. Develop and implement standardized processes and best practices across the supply chain network.

In the end, we perceive these responsibilities as part of the business, and they must be managed in the way top-bottom. There is no chance that a single unit from the network can deliver the right decision to manage more than one warehouse. We may say that a single manager can see better what is on the warehouse floor, but he won't be able to share a more holistic view to be unaware of what is on the floor in other units.

Ultimately, the supply chain control tower is a powerful tool that empowers businesses to make data-driven decisions. For example, control tower technology enhances stakeholders' collaboration and achieves greater operational excellence. It may have built-in transportation management system and warehouse management system capabilities. 

Whether you are a small business or a large enterprise, implementing an SCCT can help you navigate the complexities of the modern supply chain and stay competitive in today's dynamic market. This is why 65% of companies already have this role. Its success in coordinating end-to-end planning depends on the presence of the five other organizational mechanisms discussed below.

Beyond delivery: how logistics and supply chain management keep everything moving

Article by:

Pawel Bes

What are the challenges of the supply chain?

According to the McKinsey survey, companies face several top challenges in the supply chain. Key supply chain transformation challenges are as follows:

• Talent and skills. Reskilling the workforce (70%) and acquiring new talent with the necessary skills (55%) are significant hurdles.

• Advanced capabilities. Implementing advanced analytics (60%) and centralizing supply-chain planning (58%) are critical but complex undertakings.

• Strategic sourcing and inventory. Companies are grappling with dual sourcing of raw materials (53%), increasing inventory of critical products (47%), and near-shoring/expanding their supplier base (40%).

• Planning, execution, and informed decisions. Maintaining a fast SOP cycle (50%) and regionalizing supply chains (38%) present challenges.

• Financial constraints. Budget limitations are a significant obstacle for many businesses undertaking supply chain transformations (11%).

What is a supply chain control tower?

Supply chain control tower (SCCT) is a software-built solution created to secure the operations above at every stage. It's about to help tackle these challenges and cope better with business. 

Here are the supply chain control tower (SCCT) critical capabilities:

End-to-end visibility

Gain a comprehensive, real-time view of your entire supply chain, from raw materials to finished goods, eliminating blind spots and enabling proactive management.

Real-time monitoring and alerts

Stay ahead of potential disruptions with real-time monitoring of key performance indicators and automated alerts that flag exceptions and deviations.

Data analytics and insights

Leverage the power of data analytics to uncover hidden insights, identify trends, and predict potential problems before they impact your operations.

Collaboration and communication

Foster seamless communication and collaboration among all supply chain partners, ensuring everyone is on the same page and working towards shared goals.

Exception management

Streamline the resolution of supply chain disruptions with automated workflows and exception management tools that minimize manual intervention and response time.

Decision support

Empower your decision-makers with real-time data, insights, and scenario-planning capabilities to optimize supply chain performance and drive strategic advantage.

Integration and connectivity

Seamlessly integrate your SCCT with existing enterprise systems and external data sources for a holistic view of your supply chain ecosystem.

Customization and configurability

With customizable dashboards, reports, and alerts, you can tailor your SCCT to your business needs and industry requirements.

How can the SCCT model be applied to SMBs?

According to a McKinsey survey, nearly 70% of transformation programs fail, often because employees lack the skills and capabilities needed to support them. Therefore, high-performing companies prioritize internal skills development. Nevertheless, implementing SCCT can yield considerable results in a very short period and provide benefits quite quickly. Small and medium businesses can benefit from SCCT by implementing specific capabilities for the entire solution. No company may need all the features, which might be very expensive and useless in the long term.

At Adexin, we have already had hands-on experience with many projects, implementing various solutions for freight, transportation, and warehousing to deliver solutions that exactly match the needs of supply chains and control towers. 

Here are the two cases of our implementations:

eProcurement platform for ITS Astra

We delivered a custom eProcurement and order management system for ITS Astra, streamlining their educational resource procurement process. This solution replaced paper catalogs and manual Excel tracking, enabling teachers and department heads to easily find and request resources while principals gained control over budgets and approvals.

The system automated inquiries, significantly speeding up order processing for managers and providing full transparency into logistics and supply chain. It's all to cut logistics costs with real-time visibility. Over two years, this solution has enabled ITS Astra to scale transactions significantly while maintaining high quality.

AI-powered parking system for 6sense Innovations

We developed an artificial intelligence-powered, cloud-based parking management system for 6sense Innovations, optimizing parking operations and automating transactions through license plate recognition. This solution has enabled dozens of parking businesses to increase revenue up to tenfold while reducing operational costs and investments by as much as 90%. Processing approximately 100,000 cars and transactions daily, the system has helped 6sense Innovations build a scalable and profitable business over their three-year partnership.

Artificial intelligence in supply chain

Article by:

Pawel Bes

How to find a software partner and link your supply chain?

According to McKinsey, supply chain disruptions impacted most businesses, with 73% reporting supplier-related issues and 75% experiencing problems in production and distribution. The food and consumer goods sectors were particularly hard hit, with all respondents (100%) facing production and distribution challenges and a significant majority (91%) struggling with supplier issues.

These figures show that companies need a clear improvement plan and should directly move toward digital transformation. So, how do they do so?

Find your business partner for SCCT. Finding the right software development partner is crucial for your business's success, given the industry's complexities and the potential for mismatched expectations. So, careful evaluation is essential. While breaking a contract is possible, it's a costly endeavor. To mitigate these risks, we'll outline eight key factors to consider when finding and evaluating a potential partner.

Choosing a software development partner requires careful consideration of several key factors:

• Company information. Evaluate the company's lifespan, size, and timezone to ensure they are a stable, appropriately sized partner who can effectively collaborate with your team.

• Reputation. Research the company's reputation through customer testimonials and reviews on platforms like Clutch and GoodFirms.

• Industry expertise. Look for a partner with proven experience in your industry, demonstrated through relevant projects, industry recognition, and a deep understanding of your specific needs.

• Technical experience. Assess their technology stack, relevant projects, and experience with integrations to ensure they possess the technical capabilities to deliver your project successfully.

• Communication and collaboration. To foster a productive working relationship, prioritize clear, responsive communication and a strong cultural fit.

• Availability and flexibility. Determine their engagement model, start time, scalability, and agility to ensure they can adapt to your project requirements.

• Contract. Carefully review pricing models, hourly rates, intellectual property rights, termination conditions, and reporting mechanisms to protect your interests.

• Support. Clarify support responsibilities, pricing models, and responsiveness to ensure ongoing assistance for your project.

Finale takeaway

The modern supply chain, particularly for SMBs, faces increasing complexity and disruption. While large enterprises often have the resources for sophisticated control tower implementations, SMBs can benefit significantly from a tailored approach. This article shows that a supply chain control tower (SCCT) is a dedicated business unit or software solution. It offers crucial visibility, real-time monitoring, and data-driven insights. SCCT empowers SMBs to optimize operations. You can genuinely improve collaboration and navigate challenges like talent shortages.

However, a successful SCCT implementation requires careful planning and execution. SMBs shouldn't feel pressured to adopt every feature of a full-scale solution. Instead, they should focus on identifying their most pressing supply chain challenges and selecting SCCT capabilities that directly address those needs. This targeted approach ensures a cost-effective and impactful implementation.

By taking the steps we mentioned, SMBs can leverage the power of SCCTs to streamline their operations. Don't let the complexities of the supply chain hold you back. Contact us and move on the way with the power of a tailored supply chain solution and take control of your business's future.