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Achieving Supply Chain Integration: Connecting the Supply Chain Inside and Out for Competitive Advantage

Book Description

High-Value Supply Chain Integration

New research, practical priorities, actionable solutions

  • Master new best practices for integrating demand, supply, and partners worldwide

  • Bridge key “integration gaps” to maximize customer value and profit

  • Improve performance in areas ranging from resource availability to returns

  • From leading supply chain integration experts at the University of Tennessee’s Haslam College of Business

  • In volatile, global environments, only well-integrated organizations can deliver superior customer outcomes and sustained profitability. Supply chain practitioners are on the frontlines of integration: they must bring together functions ranging from sales to logistics and a world of third-party suppliers. Integration is not easy, but proven solutions exist. In Achieving Supply Chain Integration, leading experts reveal what works and how to make it work.

    The authors and contributors clarify what supply chain integration really means, and why it’s even more crucial than many companies realize. You’ll learn how to manage core conflicts that make integration difficult, so you can maximize value to both customers and your organization.

    You’ll find example-based, research-driven insights for both internal and external integration, addressing issues ranging from culture to financial metrics. The authors share practical guidance on everything from building more innovative partner relationships to avoiding raw material shortages.

    Whatever your supply chain or operations responsibilities, you need to integrate more effectively, and this guide will help you do it.

    Supply chain integration can ensure a smoother, more efficient flow of products, and enable access to third-party resources and capabilities that would be costly or impossible to build internally. However, successful integration has proven challenging, especially as supply chains evolve to encompass even more external partners.

    The Department of Marketing and Supply Chain Management at the University of Tennessee’s Haslam College of Business has focused extensively on researching successful integration across demand, supply, and inter-enterprise functions. Now, its pioneering researchers share indispensable new insights on making integration work throughout your supply chain.

    Achieving Supply Chain Integration shows how to prioritize which processes and functions to integrate and select integration strategies likely to deliver the greatest performance benefits. Drawing on actual successes and failures, UT’s researchers illuminate best practices and common mistakes. They present proven approaches to integrating sales, marketing, core supply chain functions such as procurement and logistics, and widely diverse partner relationships.

    Whether you’re a practitioner or student, this guide will help you approach integration projects with “eyes open”—so you can mitigate risks and maximize value.

  • Understanding what integration is and isn’t, and why it matters so much

  • Bridging the integration gap to maximize value creation

  • Fully leveraging information in internal and external integration

  • Driving more value by integrating purchasing and logistics

  • Aligning market, environmental, social, and political strategies

  • Achieving deeper demand/supply integration

  • Reducing product returns through better internal integration

  • Building more innovative, collaborative supplier relationships

  • Table of Contents

    1. About This E-Book
    2. Title Page
    3. Copyright Page
    4. Dedication Page
    5. Contents
    6. Preface
    7. About the Authors
    8. 1. Integration: What It Is, What It Isn’t, and Why You Should Care
      1. Integration and Supply Chain Management
      2. What Factors Lead to Integration?
      3. What Are Integration’s Performance Implications?
      4. Solidifying Our Understanding of Integration
      5. Toward Consensus on Cross-Functional Integration
        1. Cross-Functional Collaboration
        2. Cross-Functional Coordination
        3. Cross-Functional Communication
      6. Extending Previous Definitional Work on Integration
      7. Planting the Seeds for Integration
        1. Organizational Structure
        2. Process
        3. Culture
      8. Tools Available to Managers
        1. Top-Down Culture Change
        2. Bottom-Up Culture Change
      9. Conclusion
      10. Endnotes
    9. 2. Bridging the Integration Gap
      1. The Difficulty in Integrating
      2. Interfunctional Bias
      3. General Methods for Overcoming Conflict Within Integration
      4. Interest-Based Problem Solving and Collaborative Communication
        1. Step I: Establish Ground Rules/Conduct Initial Sharing/Determine Logistics
        2. Step II: Develop and Reinforce a Constructive Communication Process
        3. Step III: Define the Problem or Situation to Overcome/the Outcome to Be Achieved
        4. Step IV: Identify Individual and Functional Interests
        5. Step V: Consider Potential Actions and Select/Justify an Agreed-Upon Action Plan
        6. Step VI: Provide a Cohesive Action Plan to Decision Makers and Other Stakeholders
      5. Conclusion
      6. Endnotes
    10. 3. Maximizing Organizational Value Creation Across the Great Divide
      1. The Demand and Supply Integration Journey
      2. Four Examples of the DSI Journey
        1. Company A: Automotive Assembly
        2. Company B: Health and Beauty Care Manufacturing
        3. Company C: Fast-Moving Consumer Goods Manufacturing
        4. Company D: Consumer Electronics Manufacturing
      3. Managerial Implications
        1. Run the Entire Business with a DSI Perspective
        2. Guide DSI Decisions Through Information Visibility and Shared Knowledge
        3. Prioritize Financial and Human Resource Deployment
        4. Align Operational Execution with Relevant Value Focus
      4. Conclusions
      5. About the Research
      6. Endnotes
    11. 4. The Role of Information in Internal and External Integration
      1. The Importance of IT Infrastructure Integration to Supply Chain Effectiveness
      2. The Role of Operating Models in Relation to Integration
      3. Conclusions
        1. Issue #1: What are the most substantial technological and cultural barriers organizations are facing today?
        2. Issue #2: What’s the best way to identify roadblocks in your IT infrastructure that prevent your company from becoming more agile?
        3. Issue #3: Actions organizations can take that will lead them toward an agile, business-driven IT future
      4. Endnotes
    12. 5. Bending the Chain: Deriving Value from Purchasing-Logistics Integration
      1. The Surprising Challenge: Purchasing and Logistics Integration
      2. Supply and Demand Disconnects
        1. Supply-Side Disconnects
        2. The Surprising Gap Between Purchasing and Logistics
      3. The Research: Linking Purchasing and Logistics Integration (PLi) to Improved Functional and Financial Performance
        1. Major Finding 1: Purchasing and logistics frequently are found in a broader supply chain or operations organization but really exist as two separate and disconnected functions. (Table 5-1)
        2. Major Finding 2: Both purchasing and logistics are well aligned independently with their business unit’s strategy and activities but not nearly as well aligned with each other. (Table 5-2)
        3. Major Finding 3: Despite formal organizational links between purchasing and logistics, interaction between the functions is typically informal and unstructured. (Table 5-3)
        4. Major Finding 4: Maintaining open lines of communication is the most widely used technique to foster integration. (Table 5-4)
      4. Best Practices
        1. Best Practice 1: Fully integrated end-to-end supply chain organization with common metrics
        2. Best Practice 2: Talented supply chain organization that rewards people for in-depth mastery and end-to-end supply chain leadership
        3. Best Practice 3: Purchasing and logistics network with an operating decision framework based on best overall total value of ownership (TVO = total cost of ownership plus level of customer creation)
        4. Best Practice 4: Effective information systems and work processes that enable superior business results by providing multifunctional supply chain teams the proper tools and information
      5. Seven Actions a Supply Chain Leader Can Take Today
      6. How High Is Your PLi?
      7. Endnotes
    13. 6. Getting Aligned: The Benefits of Integrating Market, Environmental, Social, and Political Strategies Within the Organization
      1. How Do Executives Engage in Strategic Management?
      2. The Alignment Framework
      3. Applying the Alignment Framework
        1. Industry Analysis
        2. Competitor Analysis
        3. Country Analysis
        4. Stakeholder Analysis
        5. Company Analysis
      4. Integrating Market and Nonmarket Strategies
        1. Actions and Performance
      5. Conclusion
      6. Endnotes
    14. 7. Achieving Demand and Supply Integration
      1. The Idea Behind DSI
      2. How DSI Is Different from S&OP
      3. Signals That Demand and Supply Are Not Effectively Integrated
      4. The Ideal Picture of Demand and Supply Integration
      5. DSI Across the Supply Chain
      6. Typical DSI Aberrations
      7. DSI Core Principles
        1. DSI Should Be Demand Driven
        2. DSI Should Be Collaborative
        3. DSI Should Be Disciplined
      8. Critical Components of DSI
        1. Portfolio and Product Review
        2. Demand Review
        3. Supply Review
        4. Reconciliation Review
        5. Executive DSI Review
      9. Characteristics of Successful DSI Implementations
      10. DSI Summary
      11. Endnotes
    15. 8. Sell Right, Not More: Leveraging Internal Integration to Mitigate Product Returns
      1. A Returns Management Overview: Inspiring Internal Integration
        1. The Micro Approach: Managerial and Employee Behaviors
        2. The Returns Management Process
        3. Integrated Forward and Reverse Flows
      2. The Challenge of Managing Returns
        1. Cross-Functional Integration
        2. Alignment
        3. Synchronizing the Flows
      3. Thoughts and Observations
      4. Endnotes
    16. 9. Supplier Integration via Vested Relationships
      1. The Sourcing Continuum
        1. Developing Corporate Hierarchies: “Make” or Insource
        2. Using the Market: “Buy” or Outsource
        3. Hybrid Relationships
      2. Seven Sourcing Business Models
        1. Basic Provider Model
        2. Approved Provider Transaction Model
        3. Preferred Provider Model
        4. Performance-Based/Managed Services Model
        5. Vested Sourcing Business Model
        6. Shared Services Model
        7. Equity Partnerships
        8. Different Models Need Different Systems
      3. Supplier Integration via Vested Relationships
        1. Rule #1: Focus on Outcomes, Not Transactions
        2. Rule #2: Focus on the What, Not the How
        3. Rule #3: Clearly Defined and Measurable Outcomes
        4. Rule #4: Pricing Model Incentives Are Optimized for Cost/Service Trade-offs
        5. Rule #5: Insight Versus Oversight Governance Structure
      4. Conclusion
      5. Endnotes
    17. 10. Raw Material Feast or Famine: Integrating Supply Networks to Overcome Resource Scarcity
      1. Supply Risk—It Is There, Whether You Manage It or Not
      2. Understanding the Network of Risks
      3. Managing the Network of Risks: Detection, Mitigation, and Recovery
        1. Detection
        2. Mitigation
        3. Recovery
      4. Integration as an Enabler of Continuity and Resiliency
        1. Integration Examples
        2. Integration Examples: Lessons Learned
      5. A Network Approach to Managing Supply Disruptions Through Integration
      6. Natural Resource Scarcity and the Dynamic Global Supply Network
      7. Conclusion
      8. Endnotes
    18. 11. Integrating Ideas and Environments: Blending Marketing Strategy with Context for Organizational Success
      1. The Study: Integrating Marketing Strategy with a Firm’s Internal and External Conditions
        1. The Survey Study
        2. The Interviews
        3. Results
        4. Implications
        5. Recommendations
      2. Conclusion
      3. Endnotes
    19. 12. External Barriers to Integration: Tearing Down the Walls
      1. Conceptualizing Integration
      2. Defining the Types of Barriers
        1. Information Barriers
        2. Process Barriers
        3. Relational Barriers
        4. Summary of the Barriers
        5. How Can the Barriers Be Overcome?
      3. Concluding Thoughts
      4. Endnotes
    20. Index