SUPPLY CHAIN STANDARD SEPTEMBER 2008
www.supplychainstandard.com
How’s your
teamwork?
Our collaboration
covers store
managed
inventory,
vendor-managed
store promotions
and product
launches with
our largest
suppliers.
Organisations are looking for technology
that they can pick up and run with.
Collaboration is the word now on everyone’s lips. But, asks JOHN LAMB,
how effective are manufacturers and retailers at collaborating?
In recent years supply chain partners have invested heavily
in systems to facilitate collaboration by enabling them to
share data and take joint decisions. Some call it the nude
economy – an economy in which everything is on show.
But how effective are manufacturers and retailers at
collaborating and to what extent are the tools that they use a
valuable adjunct to business or just a case of the emperor’s
new clothes?
Terry Ashworth, supply chain director at the Co-operative
Group, has no doubt about the value of collaboration. His
company’s efforts to share its plans with 20 key suppliers is a
key element in a variety of collaborative activities.
“Our collaboration covers store managed inventory, vendor
managed store promotions and product launches with our
largest suppliers. The smaller ones don’t have the IT or the
resonance to take part.
“We give suppliers access to stock data in some
distribution centres and dispatch data, although we do not
share Epos (electronic point of sale) information with them.
The benefits we get are better stock availability and we keep
our requirement for working capital to a minimum.”
The Co-operative Group uses both JDA’s E3 enterprise
resource planning (ERP) software and Manhattan’s Trading
Partner program to facilitate collaboration. Forecasting and
SCS:SUPPLY CHAIN COLLABORATION 17
replenishment are carried out on the E3 system using
previous sales history overlaid with seasonal parameters. The
Co-operative Group also uses Delphi forecasts to weigh up
the likely impact of individual promotions.
Although the Co-operative Group draws the line at
exchanging sales information, Ashworth is relaxed about
the possibility of confidential information ending up in
competitors’ hands. “There are few dangers because we
only pass on data that is related to a supplier’s products,”
he explains.
However, organisations outside of retail are not always so
willing to open up their knowledge and systems when that
means sharing the secrets of their inventory processes or
quality assurance procedures with firms that may have
dealings with rivals in the same industry.
“Eight years ago people talked about the nude economy –
the idea that customers and suppliers could get at your
internal workings,” says Simon Begg, European research
director of ARC, the advisory firm. “But that degree of
openness isn’t necessary. What people want to know is
‘where is my order, has it shipped, has it left the warehouse?’
“Certainly all the technology is there to assist in that.
That’s all in place. But so far as sharing forecasts is
concerned why should your suppliers care about what you
To view a Ceros magazine you need to have JavaScript enabled in your browser and have the flash player 8 or higher installed. To install the latest flash player, click the icon above, install the flash plugin and then click here to refresh this page.