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Why Is Transparency Critical For Effective Supply Chain Management?

November 26, 2013BY AMS Editor

Knowing the exact source of all your supplies and how they get to you is critical for effective supply chain management.

An article on discusses how disruptions from natural disasters have brought down reliable and stable supply chains in the past, but visibility can help companies mitigate the effects of disruptions. One potential solution is a platform called Sourcemap.

The product, developed by researchers at the Massachusetts Institute of Technology, provides the “ability to see the complete supply chain for a product or company and fully understand where things come from. And, in the event of natural disasters or political unrest, quickly assess the potential impacts on the entire supply chain,” the article says.

The idea behind Sourcemap — billed as “the social network for supply chains” — is great, and this mapping application is just the first step. Expect to read more about this in the future.

The concept of supply chain transparency is also now becoming a strategic business initiative, as companies seek to gain customers’ trust and loyalty. McDonald’s, for example, began putting information about where its ingredients come from right on the packaging, because consumers are demanding to know more about what they’re putting in their bodies.

Supply chain transparency is just as important to a manufacturer or distributor as it is to a consumer. It’s just as likely that the distributor doesn’t have full visibility into the entire sourcing of all products and components beyond the immediate supplier.

But to react to and truly protect their business from certain events — such as a weather disaster or financial difficulties impacting suppliers — it’s imperative to dig deeper and understand the ultimate source of all products. In other words, companies need to know and understand events affecting not only them but their suppliers and their suppliers’ suppliers.

Distributors can’t expect suppliers to always be forthcoming about problems. That is why having a supply chain mapping application would be highly valuable for managing risk by identifying issues at their source, well before the effects trickle down and affect their supply chain operations.

Source:, October 2013

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