Daily Archives: April 20, 2007

Collaborate, Collaborate, Collaborate, Collaborate III

Just in case the first eight times I said it (in parts I and II) weren’t enough to get your attention, here are a few more summaries of articles extolling the virtues of collaboration – which should be at the forefront of your mind now that you know all of the risks you need to start mitigating!

Supply & Demand Chain Executive ran an article on how the Collaborative Production Management Market for Process Manufacturing [is] Seen Due for Significant Growth. Specifically, the market is expected to grow at a compound annual growth rate of about 12 percent over the next five years as global competition and regulatory requirements drive growing interest in emerging solutions, according to the ARC Advisory Group.

The article states that the intense global competition brought about by the “flattening world” is driving manufacturers to seek solutions that reduce cost, increase customer responsiveness, and deal with demand. This is driving them to collaborative solutions.

In addition, Supply & Demand Chain Executive also ran an article on Supply Chain Strategies to Manage Volatile Demand that listed four primary strategies for managing demand, of which one was collaborative processes, since collaborating with suppliers enables a company to send forecast data to its suppliers faster, enabling the suppliers to plan their supply chains and respond faster to demand changes passed on.

The Supply Chain Management Review ran For Closer Collaboration, Try Education which noted that just as a company educates and develops its own employees to enhance performance, it needs to extend that effort to its supply chain partners as well and provided a framework for collaborative education.

According to the article, there are five levels of collaborative education:

  1. Transactional Knowledge

    where little education is provided across organizations

  2. Product Capabilities Knowledge

    where learning may occur across organizational boundaries by way of requirements and capabilities dissemination

  3. Execution Certification

    where the customer plances an emphasis on ensuring that the supplier meets minimal training requirements

  4. Cross-Relationship Education

    which represents the beginning of a true collaborative-education process which is aimed at building a mutually beneficial partnership between members of the supply chain

  5. Collaborative Learning

    which marks the culmination of a collaborative-learning environment where complementary abilities, knowledge, and strategies are leveraged to provide a catalyst for learning

The fifth level can be reached by concentrating on five key areas of educational foci that can help achieve an improved fit between companies. According to the article, these five areas, which constitute the supply chain partner education framework, are:

  • Goals & Objective Alignment
  • Cultural/Change Management
  • Team Training
  • Supply Chain Skills Training
  • Technology & Process Mapping

The article concludes that the crucial differentiator in the global economy is shifting from mass production and manufacturing to knowledge and that success now depends increasingly on the ability to identify, develop, and leverage skills, knowledge, and relationships.

Not long after, the Supply Chain Management Review also ran A Supply Chain of People where they noted that in today’s global environment, training efforts need to focus on giving people the skills that enable them to collaborate with their supply chain partners around the world since we are all part of an extended global supply chain community.

The article also notes that a global organization needs to create its own supply chain culture to enable and enhance collaboration and that creating such a culture and that this involves addressing both values, or the way people think, and behavior, or the way people act. The culture must be all pervasive and shine through in service to customers, attitudes toward suppliers, adherence to established processes, readiness for and adoption of change, communication styles, and level of respect for members of the extended supply chain team.

The article offers four recommendations for creating a global supply chain of successful people:

  • Training Workshops Relevant to the Business

    Offer content that combines solid strategy-based principles with case studies and examples drawn from your business environment.

  • Make the Training Events Global

    Make sure to include participants from all of your global operations.

  • Address the Cultural Filter

    Insure that the training includes content and discussion that will help the participants recognize their own cultural filters and understand how it differs from those of other global supply chain participants.

  • Put the Training to Work

    Training must be put to work on Monday morning to be effective.

    Training not applied immediately is soon lost.

Purchasing ran an article on Inventory Control: Treat the cause, not the symptom where they noted that supplier collaboration is critical in inventory control efforts and necessary to reach best-in-class status.

Finally, Optimize recently published a piece on embracing open business models which noted that even innovative companies can use a helping hand or two.

In an open model, a company uses a transparent business model, uses greater use of external ideas and technologies, and shares their unused ideas from others. This allows an organization to bring innovations to market more quickly, less expensively, and secure a competitive advantage.