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The spread of pervasive computing had resulted in faster integration of business process between channel partners. This coupled with emergence of single-point contact for delighting the customers has led to functional silos type of organization design system being a liability rather than being an asset.
Furthermore, advent of Internet, rapid rise in outsourcing and emergence of concepts such as Just-In-Time had led to manufacturing system becoming an eco-system consisting of suppliers, manufacturers, wholesalers and retailers. Firstly, organizations had to augment the functional system with 'process excellence approach' to meet the transition enforced by changes due to outsourcing and information technology. The process excellence approach enables the organization to focus the end-to-end supply chain system and demand chain from the customer point of view.

We Need Process Oriented New Organizational Design - Systems Thinking

The process excellence approach has to be coupled with system thinking approach advocated by Peter Senge, and could lead to significant enhancement of the forecasting process. Peter Senge had opined that the defining characteristic of a system is that it cannot be understood as a function of its isolated components, rather it has be viewed in an integrated way. The system thinking approach lays great emphasis on cross-functional teams and structures. The formation of cross-functional teams helps to foster sharing of information between departments and foster trust, which is a pre-requisite for effecting forecasting.

The 'Trust' Imperative

In addition, organizations has to foster intra-organizational cross-functional teams but also enhance inter-organizational trust with its channel partners to enhance the efficiency of demand forecasting.

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* Contributed by: -
Uppili. R,
Alumnus of Great Lakes Institute of Management & M.A. (Economics) from Madras University,
Currently working as Research Analyst at Vistasoft India Private Limited.