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May 14, 2025

Transparency and Tracking in the Supply Chain: Key to Your Business Sustainability

Why are Transparency and Supply Chain Tracking Important for Business?

Pressure for Transparency: SMEs and cross-industry companies are under significant pressure to gain visibility in their supply chains.
Consumer Interests: 72% of e-commerce buyers consider transparency important in their purchasing decisions.
The Best Way to Honesty: Environmentally friendly businesses need to be transparent in marketing and have a traceable supply chain.

Understanding Supply Chain Transparency

DefinitionTransparency is capturing and sharing high-level information throughout the supply chain.
Benefit: Enabling mapping of the entire supply chain, enhancing visibility for economic operators, and ensuring compliance with sustainability, safety, and social responsibility requirements.
Example: Nike publishes their supplier list and periodic reports that reflect actual performance.

What is Tracking?

Definition: Tracking collects detailed data about individual components or materials, such as batch-lot data or purchase order information.
Process: Tracking the location and origin of products and their materials from the beginning to the end use.
BenefitFinding supply chain efficiency, meeting regulatory requirements, and providing information to consumers about the product journey.

Supply Chain Mapping and Its Benefits

Definition: The process of depicting a complete picture of the organization and company in the supply chain at every level.
Benefit: Prioritizing suppliers and actions, supporting risk assessment, and creating interactive visuals while respecting confidential trade relationships.

What is Supply Chain Visibility, and How is it Related to Transparency and Tracking?

DefinitionKnowing every touchpoint in the supply chain at all times.
Benefit: Collecting and sharing more information with customers and stakeholders, reducing sustainability and business risks, and improving overall performance.
Main ComponentsTransparency, mapping, and tracking all contribute to building a resilient supply chain.

Challenges Related to Supply Chain Visibility

Collecting DataNeeds a system to share data and information between various levels of the supply chain.
Loss of ControlLack of visibility can lead to loss of control over the inbound supply chain.
Data FocusingKnowing which data to focus on and which to ignore is very important.

Why Are All These Elements Important for Business?

Supply Chain Visibility: Improving workflows and increasing profits, reducing costs, and anticipating risks.
AgilityEnabling the ability to act quickly and make necessary changes to improve productivity.
Customer Needs Fulfillment: Enabling supply chain adjustments to customer demand, improving operational efficiency.

Building a More Visible Supply Chain

Employee VersatilityEmployees must be versatile from top to bottom of the chain.
Technology: Employing good technology for better visibility of moving parts in the supply chain.
Training and Workflow: Training employees to be versatile in their roles and paying attention to workflows to uncover critical decisions that need to be made.

Summary

Key Concepts: Tracking and transparency are key concepts in an effective supply chain management strategy.
Key Benefits: Helping to build visibility in the supply chain that is essential for improving business performance and addressing social and environmental issues.

Source : Peterson Indonesia

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