“Never look down to test the ground before taking your next step; only he who keeps his eye fixed on the far horizon will find the right road.”
- Dag Hammarskjold (1905-1961)

Much has been written in recent times about “visibility” in the supply chain, usually with the words “real time” in close proximity. While the phrase “real time visibility” has never been defined in a formal way, it seems to boil down to a very simple philosophy: “Whenever something has happened in the supply chain, tell everyone about it – FAST!”

So, on Tuesday, a retailer sells some quantity of Product X in each of its stores. That night, all of these POS transactions are collected, summarized and given to the manufacturer of Product X. On Wednesday morning, the manufacturer knows how many units of Product X was sold in each store the day before, and so on.

There’s just one small problem:

All of the units of Product X that were scanned at the cash register yesterday were placed on the store shelf 3 or 4 days ago...

...before they made it to the store shelf, they were received in the store’s back room...

...before they made it to the back room, they had to travel to the store on a truck...

...before they hit the road to the store, they were picked and loaded onto the truck at a distribution centre...

...before being picked at the DC, they had to be received and put into storage...

...before being received at the DC, they were in a truck or railcar from the manufacturer...

...before they left the manufacturer, they needed to be manufactured or assembled and staged for shipment...

...before being manufactured, raw materials and/or components needed to be sourced, perhaps from overseas.

When you add up the time required for all of the activities that are necessary to get the product to the shelf, the “real time” information starts to look quite dated. In essence, what the retailer is actually doing is providing a status update on products that the supplier already planned, produced and shipped several weeks or months ago.

Shaving an hour or two off the time it takes to share transactional data will certainly not do much to alleviate constraints imposed by the laws of time and distance.

So are we saying that sharing real time information in the supply chain is a waste of time? Of course not. Sharing information about the very recent past is a good and necessary thing, but it’s not good enough. Trading partners need to be sharing information about the future.

Knowing how much money you currently have in your bank and investment accounts is a necessary input for any kind of retirement planning – but in and of itself it’s not a retirement plan. You still need to project future deposits and withdrawals and make assumptions about rates of return. Then continually update and revise as time passes and conditions change.

Flowing product in the retail supply chain is no different. Real time transaction information is the base on which a supply chain plan can be built, but you still need to continually project and model the forces of demand and supply in a time-phased way to make this real time data worthwhile.

Planning problems cannot be solved with faster execution. Only by keeping our eyes ”fixed on the far horizon” will we finally be able to make a major impact on retail out-of-stocks and supply chain inventory investment.

The Flowcasting movement is about turning supply chain visibility into supply chain clairvoyance.