Distribution Business Management Association

Collaboration: The Secret that Keeps Supply Chains Running Efficiently

Photo by David Dibert from Pexels

My article today is based on an outstanding recent presentation to our SCLA Executive Think Tank group by Bart A. De Muynck, Chief Industry Officer at project44, who highlighted a little bit of good news in the supply chain world: the spirit of collaboration is getting stronger!

Interestingly, this headline has not really made the rounds. (Perhaps because alarming news in the "state of freight," such as the rise of canceled sailings from Asia to the USA, has been overshadowing positive stories.) However, collaboration is the key ingredient to making the supply chain perform at its best despite such significant issues in global shipping, etc.

And collaborating—both within single organizations and across the industry—is easier than ever before, thanks to the fantastic technology tools now available. Our colleagues at project44, as well as at Coupa Software, have recently shown us just how some of these tools, systems, and platforms work.

[Related Content: my previous article, Demystifying the Digital Twin with Coupa. Make sure to give it a read!]

But you might be wondering, isn't the supply chain collaborative by definition? Absolutely, but as many of us have experienced, it's often been siloed.

On that point, Mr. De Muynck noted, "In nature, supply chains are collaborative; that's why we call it a supply chain, and we are only as strong as our weakest shackle. Many times, we are not collaborative, still siloed within our own organization, and are only looking at our own division or our own function, let alone what's happening with all of the different partners in the ecosystem."

I want to pause here and draw attention to that word "ecosystem," which has been borrowed from the ecology discipline to be more generally defined as "a complex network of interconnected systems." This is really how we need to be thinking about the supply chain at this point in history. Our functions, divisions, and entire organizations are interdependent on so many others for success—and often survival.

So, Why Be Collaborative?

Ultimately, collaboration makes the supply chain stronger—something all of us want! By coordinating internal and external partners within organizations, we can increase efficiency, which drives better customer service and meaningful cost reduction.

And yet, Mr. De Muynck shared that his experience in presenting about collaboration to groups has revealed that many in the supply chain still feel siloed. Some are unwilling to share data they have compiled, and communication between various parties isn't always the best.

These factors have to change, and it comes down to organizational maturity. Of course, having high-quality data at the ready is also crucial, but Mr. De Muynck feels that we have removed many barriers on the technology side in most operations at this point. "There are a lot of ways the platforms allow collaboration," he shared. "There's a lot of opportunities we have today because we have access to real-time data that we didn't have before."

How Can We Better Collaborate?

Better collaboration will flow when the organization trusts its partners and is willing to be fully transparent with them. Trust—one of the 3 'T's of transforming the supply chain into a competitive weapon for your organization—is at the heart of organizational maturity.

Organizations that are successful collaborators espouse openness and willingness to share data. They trust the tech that's out there—and use it. Mr. De Muynck said, "Having just the technology is not good enough. If the system makes a recommendation, but we don't have the maturity or the organizational readiness to change our processes around that, it's not useful."

Furthermore, he added that if we have data and only use it for ourselves without sharing it more widely, "we're cutting not only ourselves short but also the industry. We need to think beyond the walls of our organizations."

What are the Big Benefits of Supply Chain Collaboration?

I already touched on a few of these benefits in the "why" section above, but it bears repeating—there are massive payoffs to going "all in" on collaboration. Beyond cost reduction and happier customers, end-to-end visibility is one of the most significant.

When we collaborate with partners throughout the supply chain, we can quickly and easily see things like locations of inventory, issues that suppliers are facing, mismatches in capacity or forecasting, issues at ports, potential strikes, and labor issues—and that equals risk mitigation as well.

The Bottom Line on Collaboration

In the end, strong tech resources that inform planning (such as the digital twin and platforms offered by our friends at Coupa and p44) make collaboration seamless. Organizations need to embrace these resources and do the work necessary to allow connections to be made.

Mr. De Muynck reassured us that it does take work that isn't necessarily simple, but it is worth doing. "Collaboration doesn't come overnight; it requires a mindset and organizational maturity. Overall, it isn't easy, but if we all work together and are willing to collaborate, a lot of great value can be extended in the supply chain, especially in logistics."

Do you have collaboration success stories to share?

As we heard from Mr. De Muynck, it takes work and commitment from mature organizations to get collaboration right. And that also comes with challenges. So let us know your experiences with collaboration, both wins and setbacks!

Supply Chain Leaders in Action promotes collaboration by connecting leaders across the supply chain industry. We're all about networking and driving supply chain collaboration forward. Are you ready to join the conversation? Connect with me directly or with SCLA here on LinkedIn!


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Monday, 06 February 2023

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