With expanding markets, growth of omni-channel distribution, and dispersed customers and suppliers, achieving significant ROI as well as operational improvements requires collaborative supply chain management. Shippers must collaborative to better arrange processes, sub-processes, and activities across warehousing. Transportation and manufacturing also matter in that context. Collaboration may be in the form of regional hubs, the sharing of infrastructure and geophysical information, minimizing complexity, and delays in legal and commercial processes.
Collaboration is necessary for cost control, quality delivery, and customer loyalty. A collaborative supply chain ensures realization of key performance factors such as reliability, responsiveness, flexibility, lower costs, and better resource management, more effectively in a much shorter time span. Effective collaboration with supply chain partners demands visibility and information sharing in real time through which a network of collaborators acts as an extension to deliver the right product to the right customer as and when they need it.
Supply chain visibility enables control over supply chain events by showcasing the end-to-end view of order lifecycle across the supply chain, along with the ability to quickly identify and resolve problems in real time.
Supply chain visibility not only helps resolve supply chain exceptions before they take the shape of major problems, but improves the performance of suppliers and carriers, putting an effective check on delays and anomalies that occur in the first place.
How an effective and efficient collaboration can be achieved
A single ERP system is enough. The system via an easy-to-navigate dashboard should allow dispersed stakeholders across the globe to understand events as and when they happen. Such a platform can manage current inventory specifics, but more importantly it can analyze past activities and anticipate future needs through ‘what if’ modeling, plan replenishment’s, accounting functions, productivity tracking, and collaboration throughout the entire supply management process.
Top reasons to collaborate
Sharing of information across the chain due to supply chain collaboration leads to better decision making, which results in:
- Lower inventory levels and higher inventory turns
- Lower costs of transportation and warehousing
- Fewer out-of-stock levels
- Shorter lead times
- Better customer service
- Visibility into customer demand and supplier performance
- Faster decision-making
Transparency and collaboration may be not easy to implement, but in view of potential reduction in risk and cost, and improvement in customer loyalty, it is of paramount importance.
As per a 2012 survey by Deloitte, in conjunction with ASQ, Institute for Supply Management, and Corporate Responsibility Officer Association, organizations that collaborated with suppliers could minimize their costs and were 38% more likely to achieve or surpass their expectations.
Processes aim at significant and quantifiable benefits (reduced inventory and lower logistics cost), while typically maintaining or improving customer service through better forecasting and improved availability. Not only will the approach boost ROI, but is make stakeholders feel more confident about their time and money. Ensuring a positive outlook throughout relationships, and not just every project, becomes easily possible, leading to effective workflows and steady profits.