scm relationships - class2
DESCRIPTION
relationshipTRANSCRIPT
Mayuresh Unde
20th August, 2011
Supply Chain Relationships
Relationship Perspectives
Arm’s Length
Collaborative Strategic
Vendor Partner Strategic Alliance
TRANSACTIONAL
RELATIONAL
Process Model for forming Supply Chain Relationships
Ability to Invest
ExpertiseStrategic
Fit
Area of Core Competency
Partnership Model:a. Drivers: Compelling
reasons to partnerb. Facilitators: Supportive
factors that enhance partnership and development
Types of Collaboration
Supplier
Manufacturer
Distributor
Retailer
Supplier # 1
Manufacturer # 1
Distributor # 1
Retailer # 1
Supplier # 2
Manufacturer # 2
Distributor #2
Retailer # 2
Vertical Collaboration Horizontal Collaboration
Collaboration occurs when companies work together for mutual benefit
Types of Collaboration
Supplier # 1
Manufacturer # 1
Distributor # 1
Retailer # 1
Supplier # 2
Manufacturer # 2
Distributor #2
Retailer # 2
Full Collaboration
Supply Chain Collaboration Spectrum
6Source: Cohen & Roussel
Number of Relationships
Exte
nt
of
Co
llab
ora
tio
n
Many Few
Limited
Extensive
TransactionalCollaboration
SynchronizedCollaboration
CooperativeCollaboration
CoordinatedCollaboration
Not Viable
Low Return
• The green arrow describes increasing complexity and sophistication of:
– Information systems
– Systems infrastructure
– Decision support systems
– Planning mechanisms
– Information sharing
– Process understanding
• Higher levels of collaboration imply the need for both trading partners to have equivalent (or close) levels of supply chain maturity
• Synchronized collaboration demands joint planning, R&D and sharing of information and processing models
– Movement to real-time customer demand information throughout the supply chain
Benefits of Supply Chain Collaboration
CUSTOMERS MATERIAL SUPPLIERS SERVICE
SUPPLIERS
• Reduced inventory
• Increased revenue
• Lower order management costs
• Higher Gross Margin
• Better forecast accuracy
• Better allocation of promotional budgets
• Reduced inventory
• Lower warehousing costs
• Lower material acquisition costs
• Fewer stockout conditions
• Lower freight costs
• Faster and more reliable delivery
• Lower capital costs
• Reduced depreciation
• Lower fixed costs
• Improved customer service
• More efficient use of human resources
Thank You!
Q & A