Executive Briefings

Collaboration Is Something You Do Internally, Not Just with External Partners

"Collaboration" and "supply chain" go hand in hand, or you might think they should. But there are two kinds of collaboration with respect to supply chains. While many companies are focused on working with suppliers to arrive at more efficient and effective solutions, studies have repeatedly shown that far fewer work cross-functionally inside the organization to achieve the same result.

At manufacturing companies, procurement and inventory management most often report to finance, while planning and logistics report to manufacturing. With rare exceptions, though, the work groups operate independently of one another. It's not a collaborative environment.

Why would a process that is responsible for investing, handling, and managing company capital not be designed and built to function collaboratively? The answer is simpler than you might think.

Organizations continue to segregate roles and responsibilities based on their internal impact on the organization, rather than their external (or end-customer) impact. Consider the typical supply-chain structure described above. The responsibilities of sourcing and procurement departments, to invest and manage capital, are overseen by finance. Planning and logistics departments have a direct impact on the efficiency and effectiveness of production. All these roles are built and managed based on internal impact.

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Keywords: collaboration in supply chain, inter-enterprise collaboration, intra-enterprise collaboration, trading partner relationships, intra-organizational partnerships, internal silos

At manufacturing companies, procurement and inventory management most often report to finance, while planning and logistics report to manufacturing. With rare exceptions, though, the work groups operate independently of one another. It's not a collaborative environment.

Why would a process that is responsible for investing, handling, and managing company capital not be designed and built to function collaboratively? The answer is simpler than you might think.

Organizations continue to segregate roles and responsibilities based on their internal impact on the organization, rather than their external (or end-customer) impact. Consider the typical supply-chain structure described above. The responsibilities of sourcing and procurement departments, to invest and manage capital, are overseen by finance. Planning and logistics departments have a direct impact on the efficiency and effectiveness of production. All these roles are built and managed based on internal impact.

Read Full Article


Keywords: collaboration in supply chain, inter-enterprise collaboration, intra-enterprise collaboration, trading partner relationships, intra-organizational partnerships, internal silos