A supply chain control tower is a digital tool that enables companies to monitor the performance of their logistics facilities, identify improvement opportunities and prioritise processes such as transport, storage and returns management.
This digital solution leverages new technologies like machine learning, artificial intelligence (AI) and big data. The aim is to provide complete supply chain visibility and obtain information to avoid mistakes or disruptions that could prevent the supply chain from functioning properly.
What is a supply chain control tower?
A supply chain control tower consists of a personalised dashboard that offers business metrics to monitor throughput in the different stages of the supply chain. Consulting firm Gartner defines a supply chain control tower as “a concept that results in combining people, processes, data, organisation and technology. Control towers capture and use (close to) real-time operational data from across the business ecosystem to provide enhanced visibility and improve decision-making.”
This digital tool brings immediate visibility on the performance of the entire supply chain, including phases in which suppliers, manufacturers, or other stakeholders play a part. The control tower collects and extracts the data produced in the different stages. This up-to-date information lets logistics managers make decisions to increase supply chain efficiency.
The control tower is integrated with the company’s other management programs. For example, it can communicate with a transport management system (TMS), an enterprise resource planning (ERP) system and a manufacturing execution system (MES) to gather information on operations and ensure complete product traceability.
The tower also connects with the warehouse management system (WMS). This software sends information continuously and in real time on stock availability, the status of orders and the organisation of goods dispatch operations. The synchronisation between the control tower and the WMS arms all supply chain players with current information on the status of storage and order picking operations. And this results in greater logistics efficiency and thus happier customers.
The publication Control towers in supply chain management — past and future points to the need for companies to centralise their information in a single tool. “The supply chain control tower is to provide brand owners with a centralised, panoramic view of demand and supply-side trading network operations,” says Anna Trzuskawska-Grzesińska, author of the study and professor in the Logistics Department at Poland’s WSB University.
“Global risk management through control towers is one of the top ten emerging trends which are shaping supply chain operations worldwide,” says the report. According to the author, events that affect business — e.g., supply interruptions, demand spikes and dips and natural disasters — “have demonstrated the need for not only cross-network visibility, but also the ability to execute supply chain plans across multiple tiers of the trading network.”
Nevertheless, a control tower shouldn’t be confused with supply chain management (SCM) software. Gartner VP Analyst Christian Titze says: “Supply chain control tower is not a stand-alone SCM application, but an integrated capability embedded in a broader SCM suite or tool. It could be an intelligent data platform providing use-case specific insights, predictions and suggestions.”
Benefits of implementing a supply chain control tower
Deploying a control tower to monitor your overall operational throughput boosts your supply chain resilience and elasticity to adapt to disruptions. This digital tool enables you to:
- Improve decision-making: the control tower applies predictive analytics to anticipate future scenarios and implement efficient supply chain planning.
- Visualise and control information: the app syncs information in real time between the different supply chain actors to achieve full visibility of all processes.
- Collaborate with stakeholders: besides increasing the visibility of each party, the control tower provides the various supply chain links with tools to share data, key performance indicators (KPIs) and information. The goal? To enhance end-customer satisfaction.
Installing a control tower makes it possible to connect all links across the supply chain, digitising processes and significantly raising their effectiveness. This is reflected by Gary A. Smith, Chief of EAM/SCM for New York City Transit, in his article Supply chain control towers — Benefits & framework for implementation, published in the Journal of Business Forecasting: “A supply chain control tower allows for end-to-end visibility into a supply chain, providing the ability to access key information, analyse it and act on it for superior decision-making and efficiency. Key benefits include balancing inventory across locations, optimising buffer stock and reducing associated carrying costs.”
Smith underlines the importance of optimising operations: “Depending on the process, typically 50% to 70% of rules-based decisions can be automated, reducing the time taken to make decisions to seconds and allowing staff to spend time on higher level decision-making. Digitisation reduces operating costs by transitioning processes to paperless systems.”
Supply chain control tower: spearheading digitisation
A supply chain control tower is a digital tool that ramps up company productivity and enhances product traceability, improving products and service for end customers. Today, most businesses are digitising management of their operations ― from product design to warehousing. A supply chain control tower makes it easier to share the information generated by each supply chain stage to increase the efficiency of logistics processes.
Want to digitise your warehouse operations and minimise the risk of error? Be sure to contact us. One of our expert consultants will advise you on the best digital solution for your company.