E-BOOK

HOW TO MAP YOUR

SUPPLY CHAIN

©Optel Vision inc. d.b.a. “OPTEL Group”, 2024. All rights reserved.
E-BOOK

HOW TO MAP YOUR

SUPPLY CHAIN
In today’s fast-paced and ever-evolving global market, understanding and optimizing your supply chain is more crucial than ever.

This ebook answers the most frequently asked questions businesses have about supply chain mapping, based on OPTEL’s expertise.
It will equip you with the knowledge and tools to begin and succeed in your supply chain mapping journey. We’ll explore why now is
the time to start, identify the main challenges you might face and outline actionable steps to get you started.

The key takeaway? It’s important to start now! Enjoy the read!

WHY COMPANIES ARE PRIORITIZING SUPPLY CHAIN MAPPING

A detailed supply chain map allows you to visually represent your multi-tier supply chain. However, the reasons and goals for businesses
in different sectors to map out their supply chains can vary widely. Let’s explore some of them in more detail.

RISK MANAGEMENT AND SUPPLY CHAIN RESILIENCE

One of the main reasons companies map their supply chain is

risk management. By identifying single-source dependencies and
assessing the potential impact of supply disruptions — such as
bottlenecks, natural disasters, geopolitical issues, and supplier
instability — you gain important insights. Supply chain mapping
gives you the information you need to proactively develop
strategies to reduce vulnerabilities and ensure business continuity.

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REGULATORY COMPLIANCE

Another reason for supply chain mapping is that it forms the

foundation for complying with new regulations being implemented
in Europe and North America. Legislations and initiatives, such
as the EUDR (European Union Deforestation Regulation), CBAM
(Carbon Border Adjustment Mechanism), CSRD (Corporate
Sustainability Reporting Directive), UFLPA (Uyghur Forced Labor
Prevention Act), IRA (Inflation Reduction Act), FSMA (Food Safety
Modernization Act), SBTi (Science Based Targets initiative), will
require extensive proof and auditing for businesses. Failure to
comply can lead to hefty fines and even the inability to export
goods to certain countries.

COST REDUCTION

Supply chain mapping helps companies identify significant

opportunities for cost savings and improvements. By optimizing
inventory levels, you can reduce holding costs and minimize excess
inventory, which frees up capital for other investments. Streamlining
transportation routes lowers fuel consumption and transit times,
decreasing shipping costs. Consolidating suppliers allows for bulk
purchasing discounts and reduces administrative expenses for
managing multiple supplier relationships. Finally, mapping your
supply chain can reveal inefficiencies in production workflows,
allowing you to implement lean manufacturing techniques, find
alternative material sources, and further drive down costs.

ALIGNMENT WITH ESG GOALS

Along with the many looming ESG regulations that are coming
into effect, businesses are deploying initiatives to map out their
supply chains as part of their long-term visions to become more
sustainable. A supply chain map is your first step to pinpoint specific
areas to reduce Scope 1, 2 and 3 carbon emissions, introduce
water-saving and more advanced recycling processes, verify
that suppliers use sustainable practices, and avoid working with
companies with shady labour practices and human rights records.
Proving your organization’s concrete actions in sustainability goes
a long way to staying clear of greenwashing and protecting your
brand reputation.

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IMPROVED SUPPLIER RELATIONS

A well-mapped supply chain can mean greater collaboration with

your suppliers, such as joint development projects and more
synchronized production schedules, reducing lead times and
elevating product quality. It highlights areas for process optimization,
which can lower operational costs for stakeholders and even prices
for customers, especially in hyper-competitive markets.

GREATER CUSTOMER SATISFACTION AND COMPETITIVENESS

With comprehensive supply chain mapping, your company can

explore ways to enhance customer satisfaction. A case in point?
Many businesses point to the fact that with a properly mapped-out
supply chain, they have been able to innovate and develop higher-
value products. Moreover, they have noticed that their customers
are willing to pay higher prices if they are guaranteed that the
products are more sustainable. All of this helps forward-thinking
companies out-edge the competition and raise their customer
lifetime value (CLV).

The ROI of supply chain mapping has been

highlighted by many supply chain experts.
This article, by Supply Chain Brain, offers
some compelling insights.
Read it here

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OVERCOMING THE CHALLENGES ASSOCIATED WITH SUPPLY CHAIN MAPPING

Mapping your entire supply chain may appear daunting, especially if your company has a multi-tiered stakeholder ecosystem. Indeed,
the complexities of modern and multi-faceted supply chains can create significant challenges in tracking, coordinating, and managing
the vast array of interconnected entities and processes involved.

Based on OPTEL’s work with many global customers, here are the most frequent challenges we’ve observed in supply chain mapping
projects, along with the solutions we’ve implemented to address them.

CHALLENGE 1

COMPLEXITY AND SCALE SOLUTION

Modern supply chains are often With Optchain™ , customers were able to create a visual
complex, involving numerous suppliers, representation of their supply chains. Utilizing easy-to-use
subcontractors, and logistics providers visualization tools, their supply chain maps became the
spread across multiple countries and first steps to evaluating current status and performance.
continents. The lack of full visibility
into supply chains, makes it even more
difficult to identify all entities involved and
understand their interrelationships.

CHALLENGE 2

DATA FRAGMENTATION SOLUTION

Supply chain data is often stored in With Optchain™’s data capture and collection capabilities,
disparate systems and formats across customers integrated data from various sources,
different departments and locations whether in third-party software programs, APIs, or even
within a company. spreadsheets, within one unified platform to map each
supplier and its suppliers both upstream and downstream
of the value chain. The platform becomes a hub, where
data is standardized and more easily traced. This facilitated
customers’ analyses of their supply chains.

CHALLENGE 3

SUPPLIER RELUCTANCE SOLUTION

Some suppliers may hesitate to share With platforms that feature robust cybersecurity features,
detailed information about their own such as Optchain™, you can reassure partners that their
suppliers and subcontractors. Data sensitive supply chain data won’t be compromised. In
security and privacy concerts are often addition, we helped our customers develop concrete
at the top of suppliers’ minds when they action plans and timelines to make sure the supplier
hear about supply chain mapping. onboarding process was as streamlined as possible.

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CHALLENGE 4

RAPID CHANGES IN SUPPLY CHAINS SOLUTION

Supply chains are dynamic and subject With Optchain™, you can use real-time monitoring tools
to frequent changes due to market to identify problem areas in your supply chain. Thanks to
fluctuations, regulatory changes, and live portraits of their supply chains, OPTEL’s customers
disruptions. developed agile strategies to quickly adapt to changes.

CHALLENGE 5

RESOURCE CONSTRAINTS SOLUTION

Mapping the entire supply chain is Yes, mapping a supply chain does take time. It is better
perceived as taking up significant time, to start earlier rather than later, especially when it comes
resources, and expertise. to proving compliance with various upcoming regulations.
The payback can be extremely fast, thanks to supplier
optimization and cost control. And, as mentioned before,
long-term benefits also include higher competitiveness,
product innovation and reduced customer churn.

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HOW TO GET STARTED

We cannot emphasize it enough: Don’t leave your supply chain mapping to the last minute, especially if your company is subject to
different regulations—whether at home or abroad.

And don’t do it alone. Find a supply chain mapping partner with the experience and the right technology platform to simplify what is a
huge undertaking.

Here are the top steps to get started on your supply chain mapping project:

1. Determine the reasons and goals behind wanting to map 4. Select a supply chain mapping partner and solution provider
out your company’s supply chain. Although there are many to support you from start to finish.
benefits to supply chain mapping, starting with one goal
is important. If successfully carried out, the project will 5. Kickstart the project planning with your partner. Discuss
inevitably cause a ripple effect and generate results that will your main goal and be transparent about your business’
impact other business objectives. context, the challenges you face, and the fears expressed by
employees and suppliers.
2. Develop a supply chain mapping plan, assigning a specific
department to spearhead the project. 6. Begin the process of engaging with your suppliers to present
the plan and get them committed to playing an instrumental
3. Communicate to all internal organizations about the role in the project.
project, its criticality, its benefits, and each team’s roles and
responsibilities.

Starting your supply chain mapping project with a clear goal, a seasoned partner, and a comprehensive plan is essential for success.
Remember, the effort you invest in today will yield significant benefits for your business in the long run.

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MAPPING YOUR SUPPLY CHAIN

You’ve chosen your supply chain mapping partner and platform. You’ve got your action plan ready. Your team and suppliers are aligned
with the strategy. But you may now wonder: what are the concrete steps to mapping out your supply chain?

In a nutshell, mapping out your supply chain begins with Tier 1 suppliers. Then, you expand to key supplier relationships (suppliers
categorized as Tier 2, 3, etc.) This is what the process looks like when using OPTEL’s Optchain™ platform:

Tier-1 Tier-1 Tier-1 Tier-1

suppliers suppliers suppliers suppliers

Tier-2 Tier-2
suppliers suppliers

Tier-n Tier-n
suppliers suppliers

1 2 3 4

INITIAL UPLOAD TIER-1 EXPANSION TO MULTI-TIER CONTINUOUS DATABASE

BY CLIENT ENGAGEMENT* SUPPLIERS MANAGEMENT

The client starts by Optchain™ then invites Following Tier-1 data input, Optchain™ ensures a
uploading its direct (Tier-1) Tier-1 suppliers to input Optchain™ reaches out to continuously updated
suppliers database into the their supply chain data, Tier-2, Tier-3, and further multi-tier supply chain
Optchain™ system. creating a comprehensive tiers, inviting them to map database, maintained
map of their immediate their supply chains within for ongoing clarity and
suppliers. the system. compliance monitoring.

Keep in mind that mapping your supply chain includes more than just a visual representation of your organization’s web of suppliers
and supplier relationships. To maximize the value of your map, you should also identify transportation modes and routings to zero in
on inefficiencies, carbon footprints, and cost reduction possibilities.

Ideally, you should also create a supplier risk index. This index is a weighted risk score of each supplier that takes into account risk
factors, including supplier performance and capacity, compliance issues, financial stability, logistical problems, location of the supplier
or its suppliers in high-risk regions around the globe, etc.

Once analyzed by the right teams in your company, these vulnerabilities will become opportunities. View them as you’re the beginning
of a blueprint for tactics and roadmaps to overcome them—all while you keep your eye on the main goal you initially set for your
supply chain mapping project.

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What are Tier 1, 2 and 3 suppliers?

• Tier 1 suppliers are your direct suppliers, providing goods or
services directly to your company.

• Tier 2 suppliers supply materials or components to Tier 1

suppliers, indirectly supporting your operations.
Tier-1 Tier-2 Tier-3
• Tier 3 suppliers provide raw materials or basic components to Supplier Supplier Supplier
Tier 2 suppliers.

Understanding these tiers helps map the entire supply chain and
identify potential risks and opportunities at each level.

HOW LONG DOES IT TAKE TO MAP A SUPPLY CHAIN?

We get this question a lot. The duration of mapping a supply chain primarily depends on the complexity of the supply chain, the number
of suppliers, the availability of internal resources, and the level of investment in technology.

For a relatively simple supply chain with good data visibility and cooperation from all parties involved, mapping can be accomplished
in a matter of weeks or a few months.

However, for more complex supply chains with numerous suppliers, subcontractors, and global logistics networks, the process can
take much longer—sometimes six months to a year or even more.

Factors that can influence the time required to map a supply chain include:

Data Your Your partner’s Features and Project Engagement of

availability supply chain’s expertise capacity of your scope internal teams
and quality complexity tech platform and supply chain
stakeholders

In summary, while it’s difficult to provide a precise timeframe, mapping a supply chain is typically time-consuming and requires careful
planning, coordination, and analysis. Our recommendation? Contact OPTEL today. Our experts can help you achieve greater clarity as
to the span of your supply chain mapping project and potential timeframe.

CONTACT US

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E-BOOK
HOW TO MAP YOUR
SUPPLY CHAIN

©Optel Vision inc. d.b.a. “OPTEL Group”, 2024. All rights reserved.