What control towers can do for your supply chain
More than an ‘old-fashioned’ freight management desk, a control tower offers functionalities which, if used well in appropriate situations, can certainly add value to logistics and supply chain operations.
Control towers are springing up across global supply chains, to go by trade media articles and news from third-party logistics providers (3PLs). Anyone who is in the supply chain arena has at least one, if not several.
The control tower concept is easy to visualise: a hive of activity staffed by multilingual traffic controllers, with its central point as a vast screen showing an integral overview of all freight flows, clearly pinpointing any problem areas.
But is that really what a control tower is about? More than an ‘old-fashioned’ freight management desk, a control tower offers functionalities which, if used well in appropriate situations, can certainly add value to logistics and supply chain operations.
What are control towers?
To understand what a control tower is, here is a summary of what it is not:
- It is not actually a tower.
- It is not in direct communication with truck drivers, sea captains or air pilots.
- It does not control the production, storage, replenishment and order process.
- It is not a synonym for a 4PL.
Control towers essentially provide supply chain visibility across divisions, countries and modalities.
The heart of a control tower is an information hub supported by a set of detailed decision-making rules and a trained team of operators. The big advantage of this central information hub is that it gathers and integrates data from various sources and then distributes it in a consistent, standardised format. This integrated overview allows the control tower operator to detect risks or opportunities at an early stage.
The actual scope of a control tower differs from one company to another, ranging from the orchestration of raw material supplies to a factory, to an end-to-end control centre. Management of spare parts and returns is always done separately.
What is the difference between control towers and traditional freight or distribution management?
Control towers are not physically or hierarchically linked to one specific location, whereas traditional freight and distribution flows are managed from either origin or destination.
Furthermore, control towers are usually focused on ‘event management’: they collect and store status information from suppliers and logistics service providers in a structured way. This information is then used to provide control tower teams with insights into the actual status of orders, products in stock and shipments. This allows teams to make informed decisions when planning, monitoring and analysing supply chains.
In contrast, freight management only focuses on transport or distribution. Freight management activities typically including freight forwarding, tracking and tracing, as well as pickup and delivery scheduling.
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