More than half of supply chain disruptions occur in the Tier 2 supply chain or lower, but only 2% of companies have visibility beyond Tier 2. Traditional approaches to multi-tier visibility rely on painstaking, costly manual processes that aren’t entirely reliable.

Identifying a pressing need to make it easier to keep abreast of risks deep in the supply chain, Everstream created Everstream Discover, an automated sub-tier risk visibility solution that is fully integrated with an established end-to-end supply chain risk management platform. The goal of Everstream Discover is to assist companies in reducing potential shortages and to better meet customer demands through end-to-end supply chain risk monitoring.

Traditional approaches to supply chain sub-tier visibility include surveys sent to suppliers, employees directly calling suppliers, or other forms of manual research. Understandably, these have often been met with resistance. The challenges such as high expenses, long processes, and evasive suppliers who hide risks make the traditional approaches not ideal.

Everstream wanted to find a way that companies could identify the most impactful risks across the supply chain network and create targeted insight-based inputs. These include incident monitoring, predictive risks, ESG, and shipment data. The Everstream platform is designed to map, monitor, assess and predict risk. Discover gathers billions of supply chain transactions, integrated with company and product reference data, then uses artificial intelligence (AI) to resolve transactions into discrete suppliers.

The supplier relationships and flow of materials is mapped using graph database technology, which uses topographical data models to store data, just like you might sketch ideas on a whiteboard. The graph queries are used to uncover previously unidentified areas of concern, such as risk concentration and long-range strategic risks. These are assessed according to material, supplier and facility location.

As the network and risks change, risk scores are updated, and users are alerted of the new score. They can also be warned in advance of events that have the potential to disrupt the network, as these are monitored and analyzed on the Everstream platform.

Users can leverage the combined solution to understand key sub-tier dependencies that create bottlenecks, as well as get alerts about transportation lane delays, and oncoming extreme weather. They can also use the solution to monitor and achieve compliance with laws such as the German Supply Chain Due Diligence Act (Lieferkettengesetz), the European Commission’s law on supply chain due diligence and the United States Uyghur Forced Labor Prevention Act.

Additional key benefits of Everstream Discover and the Everstream platform include lower inventory costs. Everstream reckons it saves users between 5% and 10% in inventory costs by avoiding unplanned outages or shortages due to sub-tier supply chain problems. Throughout 2021, businesses from machinery makers to drink manufacturers said they were likely to increase safety stocks of critical components to protect against special cause variation in demand during extreme weather, supplier failures, or a “black swan” event.

The solution can even help companies identify and start to avoid depending on sub-tier suppliers in regions of “high water stress.” This is likely to become an increasingly urgent consideration, as the United Nations estimates two thirds of the global population will face water shortages by 2025.

Implementing the Discovery solution in the real world produced some remarkable improvements in visibility into supplier risk. A global pharmaceutical and life sciences company wanted to adopt both reactive and proactive risk mitigation strategies by monitoring incidents across its multi-tier supply chains.

With proprietary data, AI and graph database technologies available in Discover, the customer now can map its full network, and filter by supplier, product, location, and much more. Within minutes, the company gets full information about which suppliers, which materials and which final products are produced with any particular material. When an alert comes in, the category manager or supplier manager can reach out to the supplier and implement an alternative plan if there is going to be a disruption. The result is improved supply chain visibility, the ability to respond quickly and reprioritize when needed, as well as substantial potential savings in sourcing.

Using Discover, this particular company identified 56 sub-tier supplier risks that were previously unknown, including in China, India, and Qatar. They were also able to identify high-dependency sub-tier suppliers linked to 38 incidences in the last 12 months. They also discovered that more than 20 sub-tier suppliers were supplying similar materials to a tier 1 supplier.

Everstream says that, in addition to these improvements, the pharmaceutical and life sciences company also hoped to achieve sustainable supply chains. Through the increased visibility Everstream offers, the company is well on its way to more sustainable supply chains.