5 Reasons Why Supply Chain Mapping is Important

The results of a Deloitte survey states that “76% of companies are now relying on digital supply chain tools for increased visibility into their supply chain, as one of their top risk mitigation strategies. A lack of transparency can impact its supplier relationships, operational efficiency, risk management and sustainability performance.” Certainly, digital tools can help, as the pressure to communicate ESG progress mounts.

Supply chain mapping is critical for businesses that want to understand and optimize their supply chain operations. It involves identifying, analyzing and understanding all of the steps involved in the production and distribution of goods and services, from extraction of raw materials to delivery to the end customers. It also includes the flow of information from suppliers to customers. By mapping out the entire supply chain, businesses can identify bottlenecks, risks and opportunities for improvement.

Why is supply chain mapping important?

Supply chain mapping is important for businesses for several reasons:

1. Identify inefficiencies: By mapping out the supply chain, businesses can identify areas where processes are inefficient or redundant, leading to wasted time and resources. Without seeing the whole picture, it is hard to know what actions to take. According to McKinsey, the potential impact of Supply Chain 4.0 in the next two to three years is huge  – up to 30% lower operational costs, a reduction of 75% in lost sales while decreasing inventories by up to 75%, at the same time significantly increasing the agility of the supply chains.
2. Save time and money: Mapping your supply chain can give you the data you need to more easily power predictive and business intelligence tools for future improvements and changes, saving you time and resources.
3. Mitigate risks: Mapping your supply chain increases transparency, enabling you to identify potential risks, such as disruptions in the supply of raw materials or delays in shipping, developing contingency plans to mitigate them. To mitigate risks, it is also becoming increasingly important for companies to know applicable standards and comply with regulatory requirements, such as conflict minerals reporting and environmental regulations. 
4. Improve sustainability: Supply chain mapping can help businesses ensure that all suppliers are acting responsibly across the value chain. It will identify opportunities to reduce your supply chain’s carbon footprint and promote sustainability by optimizing transportation routes and reducing waste. 
5. Increase customer satisfaction: By understanding the entire supply chain, businesses can better meet customer demands and expectations, such as faster delivery times and higher product quality. Consequently, it will differentiate your business from the competition.

As you can see, mapping your supply chain carries with it many benefits. We’d love to assist you in making these benefits work to your company’s advantage. Contact us for more information.

Flemming Laursen

Head of Sales for CleanChain, is an expert in the maximization of profit for companies through the use of ESG tools, data technology and impact sourcing. He was an entrepreneur and worked as director of sales for multiple businesses prior to joining ADEC Innovations.