Supply chain collaboration

What is supply chain collaboration?

Supply chain collaboration is all about coordinating and communicating with internal and external departments throughout the supply chain to create an efficient supply chain flow. The aim is to establish visibility of processes to help resolve and mitigate any challenges that may come your way, Supply chain collaboration involves every single aspect of the supply chain, from purchase orders to forecasting and quality management.

Why is supply chain collaboration important?

With supply chains spanning the globe and increasing in complexity, it’s important that there is a strong collaboration in all aspects of the supply chain to ensure a seamless flow of information. There is a huge amount of data that needs to travel upstream and downstream between departments, so it’s important to share this in real-time and you can do this by using the many supply chain collaboration tools out there on the market.

The main advantages of supply chain collaboration include increase flexibility when there are changes in demand, greater transparency in the supply chain when it comes to ESG considerations, reducing the bullwhip effect across the supply chain and understanding requirements and objectives of departments.

Reasons why supply chain collaboration is difficult

Organisations that do not collaborate effectively, will often face challenges, but there are many reasons why supply chain collaboration is difficult.

Many organisations use outdated systems and manual processes, which does not help when it comes to real-time data sharing and communication. Often, with up-to-date systems, you can achieve greater insight and visibility, without needing to add any manual intervention. Teams are also spread across the globe, so often do not have visibility on impact and challenges, so strong communication needs to be in place.

Data extraction also happens in siloes, so each department takes a vertical approach to reporting, without thinking about the whole of the supply chain which is another reason on why supply chain collaboration becomes difficult.

Steps to successful supply chain collaboration

Supply chain collaboration helps to improve and achieve an efficient supply chain, but there are some steps to successful supply chain collaboration.

1. Identify your strengths and collaborate in those areas as you’ll have a more successful outcome.
2. Look for benefit sharing where you can, where supply chain collaborations offer equal opportunities.
3. Don’t go for the largest suppliers or customers for collaboration but look holistically at all suppliers based on capabilities and value potential.
4. Invest in resources, both people and technology.
5. Look for a performance-management system to ensure the project is on track and delivers the results.
6. Collaborate with the future in mind, not just for the here and now.