Supply Chain Visibility Vs. Traceability: What's the Difference?

By Mike Gaffney

Supply Chain Visibility Vs. Traceability: What’s the Difference?

  • December 3, 2020

Supply Chain Visibility Vs. Traceability: What’s the Difference?

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Supply chain visibility and traceability are both essential for improving supply chain functionality. Many companies have limited knowledge about how their supply chain works outside of one or two upstream or downstream layers. By gaining more transparency throughout the supply chain, companies are in a better position to identify inefficiencies, reduce complexities, and improve decision making.

To make the most of what visibility and traceability have to offer, it’s important to understand the two are closely related, but not interchangeable. 

What is Supply Chain Traceability?

Think about the products you sell and all the materials or ingredients that go into those products. 

Now, pick a material. 

  • Can you trace it all the way back to its origins? 
  • How about all the way to its end users?

These are the goals of supply chain traceability. 

It’s the process of mapping the entire journey of raw materials or finished goods. Traceability is paramount in industries where safety and quality are top concerns, such as food products and pharmaceuticals. It’s also becoming more important in other industries, especially those whose customers have strong feelings about where their products are coming from or whether materials have been sustainably sourced.

Currently, the technology that is most promising to provide traceability is blockchain. In the supply chain, all components can contribute to a blockchain to provide transparent, traceable data that’s been verified and cannot be changed without altering the entire blockchain. 

For more details on blockchain technology, click here.

What is Supply Chain Visibility?

With supply chain visibility, you can see your entire supply chain at each tier of operations. Traceability is an important part of this process, which is why the two are usually talked about together.

Similar to traceability, supply chain visibility thrives on transparency. 

The main difference is that instead of knowing a product’s entire journey, visibility focuses on knowing every touchpoint in your supply chain. Different products and materials will likely have different journeys from source to end-user, and companies should understand all of the points that make up their network.

In doing so, businesses are better able to collect and share insights with customers and stakeholders, reduce operational risks, improve performance, and identify potential bottlenecks. 

How Supply Chain Data Management Supports Traceability and Visibility

To achieve supply chain traceability and visibility, companies must consider a myriad of moving parts and compile them into usable, easy-to-access insights. Supply chain data management can help facilitate this by providing a central source of truth of all products, materials, and supply tiers. 

By relying on one data resource, companies have the information they need to understand how their supply chain works and how various components are connected. They can use this data to drive decision-making and respond to risks and opportunities that could impact the bottom line.

Download our ebook for a closer look at how Specright supports your data management strategy.

 

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