Towards the Enhancement of Supply Chain Visibility in the FMCG Industry

Abstract

The Fast Moving Consumer Goods (FMCG) industry is driven by dynamic competition, globalization, and increasing pressure to improve efficiency and customer satisfaction. The increased uncertainty and complexity of coordination, result in the companies’ necessity to innovate and obtain capabilities for responsiveness and decision¬ making. Hereby, creating supply chain visibility is crucial to oppose the problems supply chain managers are dealing with. However, in many cases limited insight exists into how the right information can be collected and how to receive the right information across the supply chain that is accurate, complete, in ¬time, and of high quality. A first step towards strengthening the supply chain visibility of FMCG enterprises, is by assessing the performance of the companies’ supply chain visibility. Therefore, this study aims to design of a comprehensive support tool to assess the maturity of supply chain visibility. An extensive literature study and empirical research is executed to gain insights into the trends, complexity drivers, and critical information in the FMCG industry. Additionally, the main barriers impeding supply chain visibility were investigated. Design science as methodology is used to transform the theoretical knowledge into a digital tool as operational assessment method. This tool was developed during an iterative process existing of two separate analyses: the Visibility Maturity Scan and a Detailed Supply/Demand Visibility Analysis. Validation sessions with FMCG managers were carried out to test the practicality, overall impression, and added value of the digital tools. The managers confirmed that the tool creates awareness for critical areas, identifies critical suppliers/customers, and provides support for setting action priorities. Also, it can be used as a regular health check and benchmark of the organization over multiple years. The Visibility Maturity Scan provides grip for FMCG companies and is valuable during the project definition phase, where critical areas within the supply chain can be identified more easily. It can be placed at the website, sent by email, or used during sessions as starting point for further project proposals. The Detailed Demand/Supply Analysis provides detailed insights into the maturity of customers and suppliers in the business-to-business perspective and can be used as part of a project or detailed analysis. The tool can be used for benchmarking to a limited extent, but is more appropriate to monitor improvement processes within the same organization over time. All in all, the tool offers priorities, constraints, and implications that enterprises face in the transition towards a visible supply chain.