Addressing fragmentation and visibility to strengthen supply chains

May 15, 2020
Innovation

One way to build supply chain resilience is to make it as simple as possible, by reducing fragmentation and the number of ‘links in the chain' so that there are fewer moving parts. However, the supply chains of some industries are inherently more complex and fragmented than others. Some have complex geographic footprints, spanning multiple regions. For example, within Europe there are 600,000 trucking companies, across 44 countries, speaking 24 official languages. Some transport a huge variety of goods, requiring many modes of transport.

As supply chain complexity increases, so too does the need for transparency to provide day-to-day transport and logistics managers with accurate information and insight to enable confident and agile decision-making. When an organization has a low level of standardization across its supply chain tools and processes, perhaps due to the lack of a cloud-based solution or because of high levels of subcontracting, it results in a fragmented, out-of-date and often unreliable view of operations.

Faurecia Seating is the global leader in automotive seating components and complete seat design and assembly. Highly regarded throughout the automotive industry, they are an innovative producer of an extensive range of seat products. From seat covers, to foams and accessories, seat electronics and advanced mechatronic systems, they produce components for many of the world’s largest car brands, including BMW, Porsche, and Mercedes. As the number one manufacturer of seat structures and mechanisms for cars globally, spread across 74 production sites in 23 countries, the scale and nature of their business presents many challenges for their supply chain operations.

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Their customers demand reliable and consistent deliveries of seat parts to sustain their JIT manufacturing processes. The nature of Faurecia’s operations results in a highly complex supply chain with three key challenges. Firstly, unexpected waiting times or extra distances travelled by carriers were resulting in additional carrier costs. Secondly, the costs of production line stops if a component’s supply is disrupted are very high. Thirdly, they incur high penalties for unanticipated late deliveries. By overcoming these 3 challenges, both customer satisfaction and profitability levels are likely to increase significantly.

So how does a company like Faurecia limit supply chain risk and create a competitive advantage by increasing resilience? Faurecia selected Shippeo to give them, their carriers and their customers instant access to predictive and real-time visibility of all deliveries and solution combines four processes to achieve this. Shippeo’s solution relies on advanced technologies and integrations with existing tools and systems, delivered in a simple and intuitive way.

1. Connect

The first step is to enable the collection of real-time data from all modes of transportation across the supply chain; creating a Multimodal Visibility Network. Shippeo’s platform exchanges real-time information with all relevant systems used by the shipper and their carriers. Using APIs (Application Programming Interface) as connectors, the existing shipper and carrier systems (ERP, TMS, WMS) are integrated with truck telematics systems, IoT devices or smartphone apps. Shippeo’s platform is already connected to over 140,000 carriers in 62 countries and their expert onboarding team adds many more each week.

Faurecia and Shippeo are operating the first real-time tracking system for land transportation in the automotive industry - based on a 70,000+ carrier network, and an innovative machine learning ETA calculation, specifically designed for road transport and its unique constraints. Successfully deployed to all European plants from Faurecia’s supply chain operations department in Poland, Shippeo is directly integrated with their existing systems, and tracks all European flows, regardless of region (Shippeo is present in 24 European countries) or language (25+ spoken amongst the Customer Support Team).

2. Anticipate

The next step is to feed the real-time data collected across the supply chain into Shippeo’s proprietary ETA calculation algorithm. Developed using over 250 different parameters by an in-house data science team, the algorithm uses advanced machine learning to produce an ETA of unmatched accuracy. Location data is filtered and cleaned in real-time to improve the accuracy of stop detection, and speed estimation, as GPS positioning is subject to several phenomena that can cause inaccuracies (e.g. urban canyons caused by tall buildings). This data is matched to transport order info sourced from the ERP, TMS or WMS, allowing FTLs, LTLs or parcels to be tracked as they move from dispatcher to receiver. All of this information is displayed, with status, traffic and real-time events, for ongoing tours within the Shippeo Control Tower, offering full visibility to supply chain managers.

3. Communicate

The platform proactively communicates status and event updates with all stakeholders in real-time, to ensure everyone is on the same page. A dedicated web portal for shippers and carriers simplifies management and coordination, with customizable access management to ensure data is shared appropriately. Proactive status notifications are sent automatically via SMS, email or other channels using APIs. A public link to the order follow-up page can also be shared with an end-customer, for example.

In this way, the platform doesn’t just create value for a shipper, like Faurecia. It also creates value for their partners and customers, both internal and external, improving customer satisfaction by better managing each party’s expectations. Apart from improving overall efficiencies across the supply chain, the real-time communications, sent automatically, allow customer teams to take proactive measures swiftly and reduce any transportation risks.

4. Improve

The final component of Shippeo’s visibility platform is its ability to measure delivery performance precisely. GPS and geofencing makes it possible to capture precise delivery performance data, providing reliable and actionable insight for improving supply chain efficacy. The Shippeo Insights Module presents useful metrics in a customizable online dashboard.

Shippeo has been a direct source of cost optimization for Faurecia. By tracking dwell times anticipating delays, they can better avoid penalties and line stops. The platform has also proven to be a useful resource optimizer, as it enables refined tracking of all transportation inefficiencies, providing the data needed to create optimal milk-runs, for example.

The combination of these four processes result in Shippeo’s unique real-time transportation visibility platform, an effective tool for addressing fragmentation and transparency issues and building supply chain resilience. For more information on how you can create a more resilient and transparent supply chain please view our webinar.

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