Overcoming the Misalignment Driving Friction Between Supply Chain Partners
Today’s supply chain faces tremendous pressures. Over the past decade, customer expectations have increased, accelerating demands on suppliers and retailers. Lead times between order and delivery have vanished. Fuel costs are surging, the costs of labor and raw materials are spiraling, the economy is uncertain and consumer demands are rising rapidly. All of these factors contribute to massive pressures on trading partners.
And these pressures are impacting relationships.
For many trading partners, these impacts are evident in siloed datastreams, with difficult to locate agreements, friction in workflows and misalignment on goals. All these challenges left unattended eventually lead to fractured relationships and broken trust.
In order to work more effectively together, repair that trust and form stronger, longer-lasting relationships, trading partners need to overcome these challenges. The only way for that to work is for trading partners work more closely together—to collaborate with each other. According to McKinsey, “...companies that collaborate effectively across the supply chain have enjoyed dramatic reductions in inventories and costs, together with improvements in speed, service levels, and customer satisfaction.”
But are trading partners collaborating effectively? Are companies working together to reduce siloes, friction and misalignment? Enable decided to find out.
We surveyed nearly 250 manufacturers, distributors, buying groups and retailers about their trading agreements, points of friction and collaborative processes. We wanted to learn if trading partners were collaborating effectively with each other or just getting by. We wanted to find out if friction existed between trading partners – and if so, between who, specifically.
Some of what we learned confirmed what we already knew: that supply chain pressures have changed the shape of how trading partners do business. But we uncovered a startling trend: manufacturers and distributors are surprisingly misaligned in some key areas.
Let’s take an in-depth look at these discoveries.