Gaining a control tower and a single source of truth for your cold chain

Cold chain management   22 May 2018

Approximately 60 million people take off or land at JFK Airport in New York every year from one of nearly 100 airlines from 50 countries, an enormous feat of the airport’s control tower.

Today’s cold chains are facing similar demands when considering their complexity, volatility, and a global environment. But businesses cannot optimize what they cannot see, which means they need real-time visibility and control over temperature sensitive products throughout every step of their supply chain to fully mitigate risk and reduce waste.

Supply chain executives are increasingly facing new demands to manage the profitability of their supply chain, become more nimble and flexible, maintain security throughout every step, meet increasing customer demands, and support new growth opportunities.

Although these challenges and demands may seem overwhelming and challenging, supply chain executives understand what’s needed strategically to meet them: horizontal, end-to-end collaboration, effective, centralized talent and organizational alignment, and increased agility.

Historically, cold chain strategies have proven difficult to execute due to the lack of visibility, which was ad hoc at the end of a shipment, analysis that took days to complete, and functional silos within organizations which impeded a swift and effective response and resolution of issues.

Today, however, the adoption of supply chain technology, in addition to ERP, cloud computing, and the availability of real-time data being collected in the cloud and accessible via a centralized software platform, makes it possible to execute the strategies required for supply chain leadership. But who manages that data?

A supply chain control tower offers substantial benefits to businesses that need to extend visibility and control beyond their enterprise by providing advanced analytics, collaboration opportunities, logistics optimization, and response.

Features of a cold chain control tower

An integrated supply chain control tower serves as a centralized information hub that employs real-time data analytics and is supported by trained teams and processes. Its primary purpose is to increase flexibility and responsiveness, improve logistics and efficiency, ensure safety and quality, and reduce waste and cost.

The most significant role of a control tower is to coordinate functions across the cold chain, including partners, and satisfying customers.

Although control towers are often defined only in terms of providing visibility and generating alerts to enable proactive response, a cold chain control tower that facilitates end-to-end management also has analytics and execution at its core to improve specific KPIs across the extended value chain.

  • Informed – on demand, centralized data visibility and analytics in a single platform
  • Automated – horizontal, end-to-end transparency and collaboration
  • Smart – dynamic reporting and decision making support for proactive action
  • Execution-focused – streamline processes and information sharing
  • Compliant – monitor activity and orchestrate plans to ensure compliance
  • Continuous improvement - each part of the cold chain knows when and how it impacts another

An efficient, effective supply chain control tower isn’t meant to replace an existing ERP system, but rather, to supplement it. It isn’t meant to be a one-size-fits all solution for end-to-end visibility, but is instead should be tailored to an organization’s specific needs in terms of organizational structure, geographic scope, and processes.

Control tower challenges

The reality is that many businesses are still struggling with moving from legacy systems to digital transformation, and as a result, still maintain multiple sources of data that isn’t connected — to the detriment of their partners and customers.

This presents a significant challenge. Data may be duplicative or contradictory, and there isn’t a single source of truth. Even worse, there is no solid basis for decision making, especially for optimizing the supply chain.

Businesses want to optimize their processes, but they don’t believe it’s realistic. Upgrading to new systems is perceived as costly and slow. Change management is feared, yet the reality is that it holds organizations back.

In today’s economy of global and outsourced businesses, a control tower that is limited to an enterprise’s four walls is insufficient. Rather, its success rests on its entire foundation.

Cloud-based technology and software-as-a-service (SaaS) subscription models are actually reducing the CAPEX investment and simplifying integration efforts, which in turn, simplifies the effort to onboard third parties, including producers and manufacturers and logistics partners across the entire supply chain network.

What a control tower looks like in action

Fortunately, newer technologies and services enable businesses to turn on their cold chain and turn it into an end-to-end business operating strategically to meet the market’s increasing challenges and demands.

These control towers maintain three aspects:

360-degree visibility - real-time information is collected in a dashboard and presented in a meaningful way, providing a synchronized view across the organization and partners, with the ability to determine which events require a response. Data corresponds to pertinent KPIs track to provide actionable information. Alerts are issued when an event that impacts KPIs occurs or is impending.

Cognitive computing engine - part of being digital is providing intelligent action to business processes, using data from external and internal sources, to anticipate and prioritize issues, predict disruptions, mitigate risk effectively, and ensure smart and autonomous decision making. This is achieved by quantifying impact, providing scenario analyses, and predictive and prescriptive analytics.

Collaborative response - being digital requires automation and collaboration, including the ability to collaborate across multiple functional areas to effectively respond to an event.

As an example, a company’s customer places an order for temperature sensitive products that must be maintained within a strict temperature control environment, and its ERP system generates the outbound delivery order. Instead of the shipments being routed and investigated at the end of the shipment, shipments are monitored by a group inside the control tower.

Staffed by a team of dedicated service managers with expertise and years of experience who are equipped with advanced analytics capabilities, the control tower optimizes deliveries by saving shipments at risk of becoming damaged. It provides continued visibility, monitoring shipment delivery by receiving in-transit status messages from each carrier to manage compliance and help ensure timely arrival of shipments — something the company never would have been able to achieve without a control tower.

Once the shipment is delivered, the control tower oversees the reverse logistics of the IoT data loggers, which monitor environmental and product movement along the shipment route, sending data to a cloud-enabled software platform, replenishing them at the necessary shipment sites.

With a control tower, the company can achieve substantial ROI and brand integrity due to saved loads, optimized shipment routes, improved efficiency, and accuracy in the shipment process.

Getting started 

Control towers have been a priority agenda item to improve key metrics in the increasingly complex cold chain landscape. However, businesses often mistake the control tower construct to be the same as a visibility solution. This has led organizations to undertake large, complex initiatives to provide so-called “end-to-end” visibility, often resulting in disenchantment with the concept of a control tower.

Below are introductory questions to determine if a control tower would add value to your organization, and how to implement it:

  • Where is your supply chain underperforming and where are the opportunities for improvement? (e.g. it may include the costs of transportation and logistics, the brand costs associated with assured supply, or a lack of insights over supplier shipments)
  • Which of these opportunities provide the greatest value? In the short term? In the long term? (e.g. focus on starting with items that provide the largest impact in the shortest time)
  • How will your organization need to change to enable a control tower, if any? Are there roles in your organization that will need to be rolled into the control tower? (e.g. a control tower requires lines of responsibility so that decisions can be made quickly)
  • Where can you start, and where do you need to end up? (e.g. you’ll want to develop a high-level roadmap of how you will get there. Implementing a control tower doesn’t need to be a one-time initiative; a ‘land and expand’ approach helps get to benefits early and mitigates the risk of too much change too fast)

Control towers are a relatively new concept, but they are already demonstrating their value in helping to solve some of the most vexing challenges facing supply chain managers today. End-to-end cold chain alignment, collaboration, continuous optimization, and the ability to use real-time information to respond with quickness and agility to unexpected events — these are indispensable capabilities for supply chain leadership today. Given these requirements, one of the most powerful tools there is for boosting overall supply chain performance and maximizing the value the cold chain delivers to the business is a cold chain control tower.

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Get started with your cold tower today for end-to-end cold chain alignment, collaboration, continuous optimization, and rapid response. Contact our team today.

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