Sufficiently TEST systems before going live. As with any new system, testing will uncover any bugs or inefficiencies and can help to avoid future headaches.

Expect implementation to be a PROCESS not a project. Remember that there is no on/off switch.
Adjustments will have to be made as demand levels fluctuate, and no system will be perfect 100% of the time.

Plan to spend sufficient TIME and MONEY to make it work. Most successful VMI systems we've read about took 2-2.5 years to put into operation, and cost hundreds of thousands of dollars for IT and training. Spending (or finding) the time to create a comprehensive system can be a challenge.

Conclusion

Trading partners who focus on the changing business relationship can maximize their benefits. Under VMI, suppliers and customers can both recognize and focus on the same issue: how to sell more product to the end-user more efficiently. This changes the supplier's focus from how to get the customer to buy more to how to help the customer sell more. This change in relationship is the most exciting feature of VMI.

In conclusion, the benefits of VMI are due to the increased information flow between the customer and supplier. This information needs to be part of the day-to-day process for all parties in order to assure the quality and freshness of the data.

Concluded.

* Contributed by -
Guruprasad Pasupulety,
MBA - Batch of 2007,
Tallinn University of Technology, Estonia.