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Article
4 min read
Adrian Suciu

Few industries embody the concept of asset-intensive operations as aptly as supply chain.

 

Materials and equipment are critical to the final product, but the availability and efficacy of these resources are equally vital to product development. This is why digital transformation and automation initiatives abound across the supply chain landscape as companies strive for greater observability of their processes.

 

Observability isn’t just about watching actions take place. It’s about monitoring the supply chain progress and having the necessary real-time insights to properly assess that progress. Unfortunately, many supply chain leaders have yet to commit to observability in the current landscape.

 

Just 6% of supply chain companies have effective visibility practices, while a resounding 69% report having subpar observability protocols. Without real-time insights, supply chains become susceptible to delays, ballooning costs and stunted growth prospects.

 

The benefits of observability are clear, but it requires a solid foundation. A unified observability model provides that structure, allowing companies to respond to volatility with scalable, proactive strategies.

 

The ins and outs of supply chain observability

 

Crafting a unique and applicable observability model requires building from the ground up, starting with what observability actually means. We define it as the ability to objectively assess an operating system’s performance based on its inputs and outputs. Applied to software, observability means evaluating software health through performance metrics.

 

Observability is flexible in its ability to empower oversight into small-, medium- and large-scale supply chain systems. Most companies implement operational technology assets into larger systems that run on sophisticated software – the more mature these systems are, the more unpredictable their actions.

 

Automation, an increasingly common resource in supply chain systems, exemplifies this sophistication. Many organisations already invest in observability technology to expedite mission-critical visibility practices. With the advent of automation, however, several of those processes can be automated with a calibrated model and an influx of real-time data. While this data can help these systems become more intuitive, unchecked data can lead to disruption.

 

Though process insight has always been paramount to supply chain companies, the issue has become more critical in this age of widespread automation. Observability acts as a regular audit of IT system workloads, providing metric, event, log and trace (MELT) data to bring that status into focus.

 

These insights better position supply chain decision-makers to build and nurture a unified observability model that is scalable and relevant to a company’s current needs and future prospects.

 

How a unified observability model augments the supply chain

 

On the surface, a unified observability model might seem focused solely on IT oversight – but in reality, it’s much more than that. Rather than providing a snapshot of just your IT system’s health, it can peer deeper into the IT ecosystem and offer insight into the health of the business. By linking system functionality with comprehensive business efficiency, supply chain leadership can regularly visualise their companies’ ebbs and flows.

 

What are the benefits of a mature and unified observability model? Here are the most prominent ones.

 

Capability assessment

 

An observability model’s chief advantage is that it provides insight into what’s working and what is possible. Each supply chain company’s unique model can be calibrated to analyse the level of monitoring and provide status updates based on the three dimensions of observability:

 

  • Insight: What can be measured and found within an observability dashboard.
  • Causality: Connecting cause and effect based on model insights. The more mature the observability system, the stronger the cause-and-effect link can be.
  • Quality: A model’s value depends greatly on the kind of data that fuels it. Poor data can undermine the validity of the system.

 

Working in conjunction with one another, these dimensions can grade how much insight into the supply chain a company has, spotlighting strengths and pain points.

 

Complex system understanding

 

Next-generation supply chain production systems aren’t always simple to oversee. In fact, companies attempting observability might find the process limiting if replying on conventional means.

 

An observability model entrenches decision-makers with a framework to observe complex systems via a structured information model that uses hierarchies to collect and organise data more effectively. This centralised data container enables supply chains to identify trends early on and then use cause-and-effect reasoning to understand why something is happening and act accordingly.

 

Stakeholder appeal

 

An observability model yields data findings that can speak to the individual interests of stakeholders all along the supply chain. Those interested parties include:

 

  • Executive leadership: C-suite executives and other high-level supply chain decision-makers receive real-time insight into the whole company’s performance. Particularly, they can identify potential growth and problem areas within the business and act accordingly, decisively and strategically.
  • Business management: Production specialists can see how assets and processes on their end impact the bottom line. If the data points to delays at any point along the chain, they act swiftly and trigger a trickle-down effect of improved efficiency.
  • Operational management: Specifically, operation-level agreements can be kept top of mind to ensure processes remain on-task and on schedule, so the rest of the supply chain isn’t adversely affected.
  • Asset management and maintenance: A view into the impact of asset availability and health. Understanding this can better align asset performance and availability with demand so companies can better manage workload, overtime and other human labour issues.
  • Support and engineering: Observability models provide an organised manner to understand maintenance and troubleshooting needs. Problems can be unearthed and diagnosed, allowing this team to proactively address them so issues don’t persist.

 

Unified observability is an investment in the wholesale health of a supply chain business. With a contextualised model attuned to real-time health and long-term needs, decision-makers can regularly act in their companies’ best interests.

 

Are you ready for a deeper dive into observability and explore its impact on supply chain effectiveness? Download our Observability for Asset-Intensive Businesses whitepaper!

 

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