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What is Supply Chain Collaboration, and why is it Important?

Supply chain collaboration has been a hot topic for many years, with McKinsey highlighting the importance back in 2012 for retail and CPG businesses specifically. Nearly a decade later, many companies have yet to actively implement strategies and tools to support end-to-end collaboration across their supply chains. In the past, it was possible to credit increased collaboration through increased strategy sessions across teams that influenced the value chain and more frequent in-person visits to suppliers. However, the current supply chain landscape requires a digital solution to support collaboration initiatives.

What is Supply Chain Collaboration?

Supply chain collaboration is when two or more organizations plan, work, and execute on supply chain operations. These organizations will include internal teams, factories, raw material vendors, warehousing facilities, and distribution centers for most global supply chains.

Why is Supply Chain Collaboration Important?

If there is broken or minimal collaboration across the supply chain, operations will not run efficiently, ultimately impacting margins, timelines, and overall customer satisfaction. However, once an effective collaboration tool is put in place, businesses can quickly see their margins increase by up to 15% and turnaround times decrease by up to 50%. A digital collaboration solution also helps companies improve their supply chain by taking previously on-premise functions and turning them into streamlined software features. 

How to Avoid Supply Chain Collaboration Mistakes

While the benefits of increased collaboration are exciting, there are certainly pitfalls if a new solution is implemented incorrectly. At Suuchi, we work with hundreds of companies to outline an effective digital collaboration strategy. Below are the tips we share with our customers who are ready for improved supply chain collaboration:

  • Identify the right solution: The communication platform industry is currently valued at over $4B and is only expected to grow given the increased dependence on tools like Zoom and Slack. However, most of these platforms are not built to address supply chain participants’ needs, from internal operations managers and executives to factory managers and logistics coordinators. When most of these platforms are not inclusive for half of your value chain participants, it is essential to vet software vendors to ensure that it is intuitive for all users.
  • Start at the top: Whether you are part of senior leadership or proposing a new solution to your higherups, it is vital that the entire leadership sees the value in a new system. Most collaboration tools are siloed by departments or were not designed for users of diverse skillsets. When proposing a new solution, be sure to outline the value for all organizations to improve the entire value chain, not just a few people across the organization.
  • Onboard key users first: If you try to onboard all of your internal and external users at once, it will be very difficult to get the buy-in for participants to see the value of changing their current way of doing things. Instead, start by onboarding internal “champions” of the system that will use it the most. Ensure they feel comfortable with the system and become internal experts on all the relevant features. Once they are up and running, you can allow them to train additional internal users to increase the internal buy-in and engagement before opening up the system to outside participants (i.e., freelancers, vendors, and logistics partners) who might require more convincing.

While implementation and onboarding will vary based on the chosen solution, these three tips help simplify the process across the board.

Integration with Existing Collaboration Tools

Anytime a company is considering a new software investment, they need to understand what already exists within their tech stack. Particularly with collaboration tools like email, text, and WhatsApp, internal and external partners might feel more comfortable using those same platforms instead of introducing another system. As mentioned earlier, the solution must have the critical features needed to accommodate all users. That makes open APIs and SDKs imperative to allow for these key integrations for communication. For example, if a text is sent on WhatsApp or a user responds to a notification through email, there should be integrations to track those responses and pull them into the system. This integration eliminates some of the onboarding friction and creates a single source of truth for all communication.

Conclusion

Beyond internal teams, supply chain collaboration is imperative for supply chains to thrive and scale for years to come. While there are hundreds, if not thousands, of options on the market, innovation leaders need to identify the solutions built with all types of supply chain users in mind. Once the right solution is in place, companies will enjoy the benefit of improved operations leading to increased margins and improved turnaround times.

Ready to improve supply chain collaboration for your organization? Get started for free with the GRID’s Communication & Collaboration product.

Written by Lizzie Sessa

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