Supply chains are more complex and bigger than ever before. With more than 50 million tons of goods moving every single day, the importance of having an efficient system for managing risks and quickly resolving issues is paramount to running a successful business.
However, even though supply chain management technology is evolving every day, the time it takes to understand the problems and make critical decisions is becoming longer. A big reason for that is inefficient communication practices between different companies within a supply chain.
The time it takes from data processing to actionable steps taken is too long. When multiple autonomous companies work together to plan and execute supply chain operations, it’s easy to see how collaboration problems between supply chain partners can arise.
That’s why supply chain collaboration (SCC) software is so important, especially for organizations that have complex SCM systems that span across several autonomous entities.
What is Supply Chain Collaboration Software?
Supply chain collaboration is defined as the process in which two or more autonomous companies work within the same supply chain management system, coordinating the planning and execution of the supply chain together.
It’s easy to see how important communication can be, especially between larger, multinational companies. With numerous departments that play a part in the global supply chain process, a clear communications strategy must be established in order to effectively manage a single supply chain management system implemented across organizations.
With supply chain collaboration software, companies can develop an effective communications process between each other, which leads to numerous benefits such as better inventory planning, reduced costs and overall optimization of SCM processes.
When you have large companies working together, traditional communication systems simply aren’t enough to both maintain a grip on the supply chain data and make quick decisions.
An established collaboration system allows for real-time communications that provide more accurate forecasts. This also makes it easier to make informed decisions across a wide spectrum of SCM areas.
Here are some of the main benefits of a comprehensive supply chain collaboration software solution:
Supply chain collaboration software provides unique opportunities to make your supply chain more efficient. The ability to track real-time data of supplier and distributor performance allows you to clearly understand the patterns in place so you can make the necessary adjustments.
The goal of a supply chain management system is to consistently build value between all parts of the supply chain. If both the suppliers and the distributors work to deliver value for each other in the long term, this allows for the involved companies to grow their partnership and reap the mutual benefits of the process.
And increased collaboration between the parties involved in the supply chain is the only viable solution to ensure growth. Without an effective collaboration system, it’s very difficult to make consistent improvements in the supply chain.
Another huge benefit of collaboration software is the potential it gives to reduce costs across the supply chain. As relationships between companies evolve, over time it provides opportunities to save on numerous expenses because the procedures related to the supply chain become more efficient.
Without an SCC system in place, the initial collaboration practices aren’t likely to be very efficient, which leads to numerous problems across the supply chain. And while, over time, the communication would improve, it makes much more sense to start reaping the benefits of streamlined SCM procedures. These procedures can be implemented quickly and painlessly using supply chain collaboration software.
Enhanced Customer Satisfaction
A study by Science Direct has shown a clear correlation between collaborative practices. Practices such as effective information sharing and joint effort at improving performance are key factors in improving overall satisfaction and performance of a business.
The relationship between supply chain collaboration and an increase in customer satisfaction may not be obvious, but having an efficient system for collaboration can greatly contribute to becoming a better service provider for your customers. If the supply chain is streamlined by effective collaboration between suppliers and distributors, it can help find new ways to improve customer satisfaction by delivering a better service. This, of course, provides a huge competitive advantage.
How Are SCM and SCC Different?
The main difference between supply chain collaboration and supply chain management is that the latter covers a much wider range of functions.
Supply chain collaboration software mainly focuses on improving the way multiple companies collaborate and improve the performance of the supply chain.
So while it’s a very important piece of the puzzle when trying to develop an efficient SCM system across two or more organizations, it can’t replace the SCM software solutions that have numerous benefits reaching far beyond the scope of SCC solutions.
SCC can be a stand-alone solution, but more often than not, it can be found as an integral module of a supply chain management solution.
Top 3 Supply Chain Collaboration Solutions
RapidResponse, developed by Kinaxis, offers a wide range of supply chain applications that are driven by a powerful analytics engine. The software allows you to have a shared system with common data, so that any issues can quickly be spotted and resolved without having to leave the RapidResponse interface.
The fact that it’s a single system allows you to quickly navigate through problems and effectively collaborate to define possible approaches to solving a problem. This helps you reach the most productive compromise for both sides.
E2Open Supply Chain Operating Network is one of the most advanced and comprehensive supply chain management solutions you’ll find. It’s the perfect platform for running complex, multi-enterprise supply chains, especially when utilizing exception-based workflows.
The software includes advanced forecasting options, and can effectively track all of the inbound material movements across logistics nodes and control points. This feature allows you to track actual lead times and quickly detect and prevent any possible delays.
JDA Manufacturing Planning is an SCM solution that excels at directing collaborative cross-functional scenario analysis in real time. The software is capable of handling complex supply chain systems, seamlessly connecting supply and demand processes. By doing so, you can have complete control, so you can make quick decisions while having all of the necessary data in one platform.