Achieving Coordination in Practice

Try to achieve coordination in the entire supply chain network. The full benefit of coordination is achieved only when the entire supply chain network is coordinated. It is not enough for two stages in a supply chain to coordinate. The most powerful party in a supply chain should make an effort to achieve coordination in the entire network. Toyota has been very effective in achieving knowledge sharing and coordination in its entire network. 

Use technology to improve connectivity in the supply chain. The Internet and a variety of software systems can be used to increase the visibihty of information throughout the supply chain. Until now, most IT implementations have achieved visibility of information only within a firm. Visibility across the supply chain stUl requires additional effort in most cases. From the discussion in this chapter, it should be clear that the major benefits of IT systems can be realized only if the systems help increase visibihty across the supply chain and facilitate coordination. If firms are to realize the full benefit of the huge investments they make in current IT systems, particularly ERP systems, it is crucial that they make the extra effort required to use these systems to facihtate collaborative forecasting and planning across the supply chain. The Internet should be used to share information and increase connectivity in the supply chain. 

Share the benefits of coordination equitably. The greatest hurdle to coordination in the supply chain is the beUef on the part of any stage that the benefits of coordination are not being shared equitably. Managers from the stronger party in the supply chain relationship must be sensitive to this fact and ensure that all parties perceive that the way benefits are shared is fair. 

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