Paper Sample on Collaboration in Supply Chain: Benefits for Consumer Packaged Goods

Collaboration in a supply chain is the joint initiative between companies aiming to achieve improvements over long periods of time. These improvements include the reduction of inventories, speed of operations, levels of service, and customer satisfaction. Collaborations have many benefits to consumer packaged goods. Instead of antagonism between manufacturers and retailers where retailers try to transfer price variations upstream, collaboration allows both parties to benefit by maintaining profit margins at both ends of the supply chain.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

Even though supply chain collaboration has many benefits, for many participants, it has failed to deliver any significant results. This lack of success for much collaboration can be partially due to a lack of commitment from senior management and failure to provide the necessary resources for the collaboration effort. The collaboration effort is further impaired by misalignment of the collaboration objectives from the two organizations and their reluctance to share information they deem sensitive (Benavida, DeEskinazis, & Daniel, 2015).

For effective collaboration, companies should collaborate based on their strengths and avoid collaborating to compensate for weaknesses. For any collaboration to be successful, it should benefit both parties. The success will also depend on the capability and objectives of the partners. It is beneficial to have long sighted collaborations while investing in the right infrastructure.

Strategic sourcing, on the other hand, is used to reduce costs and improve both quality and speed. Carrying out strategic sourcing involves identifying reliable suppliers who offer the best quality materials at the lowest possible price. This ensures a steady supply of material without external interference.

There is a benefit to all parties in long term relationships developed by working closely with suppliers. Due to the rapid change in the strategic sourcing industry, it is essential to have an up to date knowledge of the field. It is also crucial to comprehend and embrace the opportunities (University of Michigan, 2015).

Conclusion

In conclusion, collaboration in the supply chain is vital for organizations in the supply chain, even though there are challenges when establishing these collaborations. Strategic sourcing, on the other hand, helps identify reliable suppliers. Both concepts help improve the efficiency of the supply chain and reduce costs.

References

Benavida, Luis, Verde DeEskinazis, and Daniel Swan. (2015). “Six Steps to Successful Supply Chain Collaboration.” Http://www.supplychainquarterly.com/topics/Strategy/20120622-six-steps-to-successful-supply-chain-collaboration/. N.P., Aug.-Sept. 201. Web. 18 July 2015.

The University of Michigan. (2015). “What Is Strategic Sourcing?” University of Michigan Transportation Services. N.p., n.d. Web. 18 July 2015.