Supply chain transparency has emerged as a hot topic in recent years, sparking countless discussions about its possible, often outdated risks rather than the significant benefits that disclosing supply chain data can bring. If done right, supply chain transparency has the potential to transform a company’s data management practices and drive decision-making, becoming a critical part of its competitive advantage rather than a liability that must be mitigated. 

Why Do Companies Struggle to Prioritize Supply Chain Transparency? 

Despite the untapped upsides of opening up supply chain data, many companies find themselves struggling to prioritize transparency well, often leading to lackluster efforts that are minimal, obsolete, and insufficient to drive meaningful change. Several factors contribute to this challenge:

• Compliance-driven mindset: Companies may treat transparency as a box-checking exercise to meet specific requirements rather than integrating it into their strategic objectives.
• Resource limitations: Internal resource constraints may result in only minimal efforts, such as posting PDFs or spreadsheets, which fail to provide comprehensive insights.
• Misconceptions about transparency: Myths and misunderstandings can prevent organizations from prioritizing transparency (learn more about those below).
• Lack of perceived benefits: Without clear, immediate benefits, transparency efforts are often deprioritized, leading to outdated data and diminished value, and perpetuating the cycle of seeing less and less benefit.

Myths About Supply Chain Transparency

Many concerns about supply chain transparency cause hesitation among companies to pursue new levels of disclosure and data sharing, but often aren’t as prevalent as you might think. Let’s debunk some of the most persisting misconceptions:

(1) If we open up our data, won’t that lead to more scrutiny of our supply chain?

• If you share where you are working, other stakeholders can proactively reach out to share information and prevent issues. Opening up data allows you to get more insights, make informed decisions, and demonstrate improvements based on what you have learned. In short, keeping your data closed hinders this process and can generate more risk in the long run. Plus, if there is an issue, organizations can reach out directly to resolve it rather than turning to the press or more public tactics, often the preferred solution for both parties.

• With growing due diligence and oversight, your supply chain is likely under more scrutiny anyway. Proactively publishing your data helps you be a part of the conversation on improvements and control on how your data is shared.

(2) Will we lose our competitive advantage by sharing where our production happens?

• In today’s information-sharing age, production locations are rarely a secret, whether disclosed by you directly or not. Publishing your supply chain data is about controlling how and where that information is shared.

• Tied to this, many companies now find their competitive advantage in the quality and nature of their relationships with suppliers, rather than just sourcing from them.

• To tackle the biggest issues of our time, this mindset must shift. Closed data has created the messy, opaque world we face today.

(3) Are there privacy or antitrust concerns with publishing my supplier data?

• You don’t need to publish sensitive data to gain benefits. You can limit it to “phone book data,” meaning publicly available information, such as a supplier’s country, name, and address, which isn’t considered proprietary and doesn’t require extra layers of protection or privacy – even just a few simple data points being in the open can make a world of difference.

Supply Chain Transparency as a Means to Outcomes

While transparency is valuable in its own right, to reap its principal benefits, supply chain transparency should not only be seen as an end goal but a means to achieve other significant outcomes. That means reframing the transparency efforts from “transparency for transparency’s sake” to “transparency that solves problems.”

How do we approach such transparency in the most effective way? That starts and ends with how the data is shared and managed. Transparency efforts drive tangible results when data is:

• easy to find in an open, accessible place
• easy to work with in a machine-readable format
• easy to act upon, shared in a context that allows you to use it effectively

Benefits of Supply Chain Transparency

When done right, transparency leads to significant benefits not only for companies but also for all their stakeholders. 

Specifically in the supply chain, publicly sharing production locations—including as many tiers as companies have mapped—presents an untapped opportunity for strategic advantage to all parties involved. Collectively building a dataset that we can all work with contributes to a supply chain data commons. When we build a collective dataset of production locations, we all can:

→ surface discrepancies and fill in the gaps (e.g., different factory aliases or incomplete addresses)
→ reduce audit fatigue by accessing and updating the same base dataset
→ eliminate duplicative data cleaning and matching with private exchanges between platforms

Prioritizing your transparency efforts also prepares your company to achieve any emerging due diligence requirements on time. The cost of anticipating these requirements is always lower than being on the back foot and responding to mandates. At a minimum, organizations need to start by understanding where their production sites are located to measure or report on social and environmental conditions efficiently.

To stay ahead of the due diligence curve, concentrate on these three core pillars:

• Know and Show Your Supply Chain: A core step to enable due diligence is knowing and sharing your supply chain. Openly displaying your data puts you in a strong position to implement effective due diligence.
• Make Your Data Interoperable: To effectively respond to legislative demands, you will need to work with others: service providers, reporting tools, remediation partners, and more. If your data isn’t interoperable, this will be a hugely time-intensive, if not impossible, task.
• Find Collaborators: Whether working on risk identification, remediation, grievance mechanisms, or other initiatives, ensure you are collaborating with other organizations connected to your suppliers or in the same geographic area to share the burden and maximize effectiveness.

OS Hub as a Supply Chain Transparency Tool

Transparency unlocks the full potential of supply chain management, reaping numerous benefits that extend beyond mere compliance – when supported by the right tools. 

As a sort of “Wikipedia of supply chain data,” Open Supply Hub (OS Hub) is powering the transition to safe and sustainable supply chains through open data. 

The OS Hub platform provides:

• A reliable, interoperable dataset: All data contributed to the platform is cleaned and processed by a matching algorithm and then assigned an industry-standard ID that is free and accessible to all. These OS IDs can be integrated into your PLM/sourcing platform as well as with your MSIs and Service Providers, creating a connected supply chain data ecosystem. Plus, when you contribute your supply chain data on OS Hub, you can easily share them internally and externally in a visual, searchable format – via an Embedded Map. 
• Living in a Public good: Covered under an open data model, anyone wishing to share, search, and/or integrate supply chain data can do so in a single place—quickly becoming one of the largest open supply chain datasets available. Additionally, production locations can be claimed by their management to keep information about the facility up to date as well as add their suppliers, enhancing levels of transparency and going beyond Tier 1.
• Facilitating global collaboration: The user-generated dataset gives visibility into which organizations are connected to which facilities, with search-enabled for overlaps between organizations, accelerating collaboration on shared interests, like setting up grievance mechanisms, advancing capacity building, and more. 

Making the Most of OS Hub

Sharing your suppliers on OS Hub is a great first step in opening up your data—but there is so much more to gain from utilizing our platform. Find out how to make the most of the OS Hub platform to go beyond transparency for transparency’s sake in our website guide or listen to our webinar. 

Find out more and integrate OS Hub into your supply chain transparency strategy:

(1) How to Share your data, (2) Search and download our free and open supply chain dataset, (3) Read more stories of impact. If you prefer video, check out our YouTube channel.

OS Hub is a non-profit platform that relies on philanthropic support to sustain the world’s most complete, open and accessible supply chain map. Join us in powering the transition to safe and sustainable supply chains by making a donation today. 

Learn more about OS Hub or explore other stories on our blog.