Supply chain network coordination

What does all this mean for a supply chain manager in Europe It means that spatial distance may not be an appropriate way to look at the supply chain because country boundaries may have an impact. It means that individual country specific rules regarding truck sizes and movement would need to be considered while planning the supply chain network. Coordination agreements to decide how orders are initiated and delivered could have a significant impact on costs. In short, the supply chain architecture in Europe would have to respond to the specific European logistics context. 

The eSCM-I procedure uses the SCOR model for purposes of process standardization. This standardization step plays an essential role as a coordination mechanism to manage interdependencies within a supply chain network. 

Weak links in the safety and security of the chemical infrastructure and supply chain networks can compromise the entire system. Given the decentralized nature of many parts of the supply chain due to distributed ownership and control, it may be difficult to coordinate risk-reducing measures across the system. Appropriate cost-effective measures must be identified to reduce risks from terrorism when there are interdependencies in the system. Strategies involving private-public partnerships can be developed to encourage firms to adopt these measures. These strategies include a combination of such measures as economic incentives, third-party inspections, insurance, and well-enforced regulations and standards. 

In some cases, companies want to design supply chain networks in which a market is supplied from only one factory, referred to as a single source. Companies may impose this constraint because it lowers the complexity of coordinating the network and requires less flexibility from each facility. The plant location model discussed earlier needs some modification to accommodate this constraint. The decision variables are redefined as follows ... 

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. 

All transportation decisions made by shippers in a supply chain network must take into account their impact on inventory costs, facility and processing costs, the cost of coordinating operations, and the level of responsiveness provided to customers. For example, Amazon s use of package carriers to deliver products to customers increases transportation cost but allows Amazon to centralize its facilities and reduce inventory costs. If Amazon wants to reduce its transportation costs, the company must either sacrifice responsiveness to customers or inCTease the number of facilities and resulting inventories to move closer to customers. 

The coordinated approach contracting relationships built on collaboration, trust and close interpersonal ties define the coordinated approach. This approach means that the producer inherits the responsibility and costs of social auditing as they are passed down the supply chain. This is achieved, however, within the framework of close retailer-supplier relationships. Although subcontracting exists, known networks of traceable suppliers are involved. As such, it is possible to exert considerably greater control over the ethical trading process. 

Corsten points out that a supply chain is a special type of network composed of multi-level logistic chains owned by legally separated companies. The focus in the supply chain is the coordination of flows of materials and information between these companies. Corsten s examples show the supply chain structure starting with raw materials up to the final consumer (Corsten/Gossinger 2001). 

Supply Chain Coordination—Growing Network and Collection Recruitment A supply chain is defined as a system of suppliers, manufacturers, distributors, retailers, and customers where material, financial, and information flows connect... 

Thousands of activities arc performed and coordinated within a company, and every company is by nature in some way involved in supply chain relationships with other companies (Bowersox 1997b Stigler 1951 Coase 1937). When two companies build a relationship, certain of their intemtil activities will be linked and managed between the two companies (Hakansson and Snehota 1995). Since both companies have linked some internal activities with other members of their supply cheiin, a link between two companies is thus a link in what might be conceived as a supply cheiin network. For example, the internal activities of a manufacturer are linked with and can affect the interned activities of a distributor, which in turn are linked with and can have an effect on the interned activities of a retailer. Ultimately, the internal activities of the retailer are linked with and can affect the activities of the end customer. 

The importance of corporate culture and its compatibility across supply chain members cannot be underestimated. Meshing cultures and individuals attitudes is time consuming but is necessary at some level for the supply chain to perform as a coordinated network. Aspects of culture include how employees are valued and incorporated into the management of the firm. 

Staff and plan for risk scenarios. As the network is outsourced, the need for network orchestration increases. Since the building of networks is often a focused effort to reduce costs, companies new at building networks usually understaff coordination. As a result, the supply chain becomes more fragile. 

Build capabilities for network orchestration. While you can outsource value chains, you cannot outsource the risk of the value chain. As the supply chain is outsourced, staff for value chain orchestration and process coordination. 

Coordination ofthe supply chain interdependencies throughout the entire e-network... 

---