Supply networks collaboration

The trend for companies to focus on core competencies has forced enterprises to collaborate closely with their suppliers as well as with their customers to improve business performance (Lutz et al. 1999). The next step in the supply chain concept is the production or supply networks (Figure 15), which are characterized by intensive communication between the partners. TTie aim of the system is to allocate among the collaborating partners the excess in production demand that could not be faced by one of them alone. This capability provides the entire network with the necessary flexibility to respond quickly to peaks in demand for the products. A tool developed at the Institute of Production Systems at Hanover University, the FAS/net, employs basic methods of production logistics to provide procedures for the efficient use of capacity redundancies in a production network. The tool satisfies the following requirements derived from the capacity subcontracting process ... 

Leaders look at the problem and wonder, "Why isn t it easier " Supply chain collaboration to build the most effective end-to-end value network sounds simple, but it has not happened effectively. Why There are some basic problems ... 

Binder M (2008) The importance of collaborative frontloading in automotive supply networks. J Manufact Technol Manag 19(3) 315-331... 

McLaren, X, Head, M., Yuan, Y. (2002). Supply chain collaboration alternatives. Internet Research Electronic Network Applications and Policy, 72(4), 348-364. 

Thompson proposes a practical taxonomy of collaborative endeavours [17]. For him, Virtual Business Networks (or VBN) are companies coming together to cooperate to achieve some shared business goal by forming networks enabled by various forms of web-based technology. VBNs appear in many guises and names such as Collaborative Networks, Virtual Clusters, Virtual Enterprise Networks, Collaborative Supply Chains, Networked Enterprises and Star Alliances. 

Specific models for different types of supply chain and network collaboration (networked, hierarchical, modular). 

Maturity level Qualities 1 Enterprise integration II Internal supply chain management (corporate excellence) III Collaboration with selected partners IV V Collaborative supply Supply network chain management connectivity (value adding)... 

The examples presented clearly show the power of social capital, which implies the capacity for commitment, spontaneous trust and collaboration among groups or individuals, contributes to the establishment, permanence, efficiency and effectiveness of supply networks. What should, however, be stressed is that this is mainly observed at the regional level. On the other hand, might not strong social capital, in the event of a considerable internationalisation of a network, become a major obstacle to that network s development Referring to the views cited earlier, one can conclude that, in this case, it is mainly the structure... 

Procurement Sourcing Material/Service Acquisition Supply base Enterprise leverage Strategic sourcing Key suppliers Auctions JIT scheduling Network collaboration... 

It follows that the two factors - supplier s capability and the interface between the supplier and the buyer -determine the supply chain effectiveness. The interface governs the relationships between the supplier and the buyer, and helps operationalize the business models of collaboration. The supplier and buyer must be able to formalize such collaboration by leveraging the individual supplier capabilities. Clearly, the buyer would be effective if s/he can build a dynamic supply network that is responsive to the needs of consumers, including rapid fulfillment of orders. The buyer may also need expertise to manage relationships with offshore suppliers. 

Cravens et al. (1996) identify four types of supply networks based on two dimensions market volatility and the type of relationships between suppliers. The relationship may span from being collaborative to being transactional in nature as shown in Figure 4.5. 

In earlier chapters, we referred to partners as other firms that happen to share the supply network with a focal firm. And in section 9.2 we started to develop the term partnership to address the evolution of additional features from a basic, arm s length relationship. Here, we use the term strategic partner to refer to a supply partner with whom a focal firm has decided to develop a long-term, collaborative relationship. Collaboration may be the ultimate objective of a number of phases through which a supply relationship may evolve. A transition route from open market negotiation to collaboration is shown in Figure 9.8. 

To explore the opportunities from structural supply chain collaboration, we built a financial model for a distribution network in the retail industry. Our cost model covers four categories of distribution cost for the manufacturer ... 

In addition to examining different combinations of the four manufacturer variables, we also consider three alternatives to the base case (Scenario I) for structural supply chain collaboration. Scenario II considers the simplest and most obvious step towards collaboration between the two manufacturers consolidating distribution centers in the two common cities of Atlanta and Reno. This step does not change the network footprint for either company,... 

In the second chapter (Structural Supply Chain Collaboration Among Grocery Manufacturers), Laseter and Weiss continued this theme, and examined the issue of supply chain coordination among the grocery manufacturers. Most notably, they quantify the opportunity for strategic, multilateral collaboration through a shared distribution network. This moved one step beyond the current focus on CPFR and VMI, which are essentially collaborative efforts focusing on inventory turns and service performance. 

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. 

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