Procurement practitioners engaged in supplier relationship management need increased visibility into the extended supply chain.
However, currently, there’s only so far they can go with this quest, because while supply networks are increasingly global today, cross-border data flows are impeded by a lack of internationally agreed rules, an academic has explained.
Michael Gravier, Professor of Marketing and Supply Chain Management at Bryant University, believes that increasing regional supply chain visibility and transparency is achievable.
Bigger companies need to stop “throwing their weight around” in an authoritarian manner during decision-making activities, and focus instead on the planning and executing processes that sustain supply chain relationships, offering incentives to assist those relationships and practising sound conflict resolution procedures.
Professor Gravier dubs this “the low hurdle” in extending supply chain visibility.
However, “the high hurdle” is, as yet, a far more elusive goal.
The reason is as plain as it is refractory: procurement pros in supply chain management roles can adapt to create the regional improvements outlined above, but the international relationships involved in global supply networks are largely beyond their control.
As yet, there are no widely agreed inter-operability standards governing the cross-border data flows that global supply chain visibility requires.
Gravier writes: “Lack of binding and coherent rules for cross-border data flows holds back progress and, especially for smaller and poorer countries, creates another hurdle to joining world trade.”
Even though data flows have been rising exponentially for several decades, the data remains governed by separate trade treaties and there is no global framework for dealing with cross-border data exchange currently in existence.
This problem of inter-operability has yet to be overcome, which means that although able supply chain managers can certainly achieve significantly increased visibility at a regional level, beyond that, it will, for the time being at least, remain stubbornly elusive.
Increasing regional visibility remains a valuable pursuit, however, as are many of procurement’s continuing core endeavours, from strategic sourcing to opportunity assessment to cost reduction.