Digital technologies serve as enablers for transparency in supply chains. They not only enable the collection and generation of relevant data along the entire value chain, but also its structured analysis.
By connecting various players – from raw material suppliers to producers to logistics service providers – they create the basis for seamless collaboration and the automation and autonomization of processes.
Supply chain transparency means that companies have comprehensive information about the origin, processing, and transport of raw materials and products along the entire supply chain. This includes the traceability of materials, compliance with human rights and environmental standards, and the disclosure of relevant data. Transparency is particularly important for identifying and minimizing risks such as human rights violations, environmental violations, or non-transparent production conditions. It enables companies to fulfill their due diligence obligations and contributes to compliance with legal requirements such as the Supply Chain Act (German: Lieferkettensorgfaltspflichtengesetz).
Digital technologies play a central role in promoting transparency in supply chains. Technologies such as blockchain and artificial intelligence (AI) enable the networking of actors, the traceability of materials, and the analysis of threat patterns along the supply chain. Blockchain ensures trust and data transparency through its tamper-proof and decentralized structure, while AI improves the data situation and supports complex analyses.
We see technology as the key to creating supply chain transparency and support efforts to make supply chains transparent through proof of origin and seamless traceability.
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Our services include both professional and technical expertise to create greater supply chain transparency with the help of digital solutions:
We use our experience and insights from numerous research and industry projects to harness technologies for greater supply chain transparency.
Digitalization is a key lever for promoting transparency in supply chains. Deep-tier transparency is only possible through technological solutions. The focus here is primarily on the recording and collection of data, the networking of actors, and the automation and autonomization of processes.
Distributed ledger technology (DLT)
DLT, including blockchain, offers an immutable and decentralized data storage system that securely documents transactions. This enables transparent and traceable tracking of supply chain processes, evidence, certificates, and master data, for example.
Artificial intelligence
AI can analyze large amounts of structured and unstructured data, recognize patterns and trends, and derive recommendations for action. It supports the monitoring of threat patterns, compliance with due diligence obligations, and the traceability of raw materials and products.
Digital twins
A digital twin is a virtual replica of a physical object, process, or system in the supply chain. It enables real-time simulation, monitoring, and optimization of processes, allowing companies to identify and resolve potential problems at an early stage.
5G and other network technologies
Network technologies offer high speed, bandwidth, and low latency, enabling fast and reliable data transmission between different players in the supply chain. They are essential for connecting sensors, edge devices, and cloud data centers.
Sensors and edge computing
Sensors collect data along the supply chain, while edge computing processes this data locally to enable real-time visibility and rapid decision-making. This combination reduces dependence on central data centers and improves efficiency.
Robotics
Robotics contributes to supply chain transparency by providing accurate information about material flows and production processes through automated data collection and processing. In addition, the integration of robotics with cognitive systems enables efficient monitoring and optimization of logistics processes.
“The combination of AI and blockchain has enormous potential to optimize processes, increase transparency, and significantly improve efficiency in supply chains. Our goal is to provide concrete answers to real problems in real processes.”
Dr.-Ing. Maximilian Austerjost, Research Associate for Supply Chain Transparency
ESG criteria (environmental, social, governance) are key benchmarks for assessing the sustainability performance of companies. They include environmental aspects such as resource conservation and climate protection, social responsibility such as working conditions and human rights, and governance factors such as corporate governance and compliance.
The transparency of a supply chain is closely linked to ESG criteria, as compliance with these standards is crucial throughout the entire value chain. Companies are increasingly required to analyze and disclose the environmental and social impacts of their supply chains in order to meet regulatory requirements such as the German Supply Chain Act and promote sustainable practices. Innovative technologies such as blockchain and artificial intelligence enable precise monitoring and optimization of the supply chain. Systematic data collection and analysis create the basis for informed decisions and strengthen sustainability performance along the entire value chain.
The project “DUH-IT” promotes the use of blockchain technology to create transparent and tamper-proof supply chains. A central component is the development of a digital product passport that ensures the traceability and sustainability of products such as green hydrogen. The aim is to support medium-sized companies in implementing innovative technologies and strengthening sustainable value chains.
The “TRUSTyFOOD” project was researching the application of blockchain technologies in the agricultural and food sector to create sustainable, transparent, and inclusive value chains. As part of an international consortium, visions, opportunities, and challenges were being identified together with stakeholders along the entire supply chain.
The project “ForestGuard” developed an open-source solution for ensuring deforestation-free supply chains based on blockchain technology. The aim was to ensure transparency and traceability along global supply chains and to support companies in complying with the EU Deforestation Regulation (EUDR).
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Supply chain transparency refers to the ability to collect and disclose information about all stages of the value chain, including the origin of products and relationships between suppliers. It is crucial for compliance with sustainability and compliance requirements.
One example is the use of blockchain technology to track the origin of raw materials such as cocoa or wood and ensure that they are free from deforestation. This enables tamper-proof documentation and traceability.
Transparency in procurement involves disclosing information about suppliers, production conditions, and compliance with environmental and social standards. It helps minimize risks and promote sustainability.
The Supply Chain Act (German: Lieferkettensorgfaltspflichtengesetz) applies to companies in Germany with at least 1,000 employees. It obliges them to identify and minimize social and environmental risks along their supply chains.
The most important principles of transparency are traceability, disclosure of relevant information, and ensuring data quality. These principles promote trust and enable effective risk assessment.
Due diligence includes identifying and assessing risks, implementing preventive measures, reporting on measures taken, and complying with human rights and environmental standards along the supply chain.
Fraunhofer Institute for Material Flow and Logistics IML