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Part - V

How? Electronic communication is an important part of Toyota's collaboration infrastructure. The company works with suppliers to keep its plants and theirs close together-sometimes literally. Electronic communication and physical proximity are useful for scheduling just-in-time component shipments, reducing inventory carrying costs and keeping the supply chain flexible.

Organizationally, Toyota and its suppliers exchange employees and build cross-functional teams to smooth process flows, decrease lead times and further reduce inventories. This allows a number of processes to be integrated, including order fulfillment, materials management, operational planning, product design, and feedback on quality and performance.

Direct Links

In a second example, Adaptec, a Milpitas, California, company specializing in communications connectivity devices, invested in eCommerce technology that would enable the company to collaborate over the Internet directly with its Asian suppliers.

Adaptec focused on the business objective of reducing manufacturing cycle times. It initially chose its three suppliers with the longest lead times. After agreeing on the objectives at all levels with the involved suppliers, the teams set to work. By the time they were finished, the cross-company, cross-functional teams had built direct links between Adaptec's SAP purchasing system and the suppliers' order management function.

In addition, the design and manufacturing processes were linked using an Internet document control system that allows engineers and buyers to resolve design problems quickly. Adaptec and its semiconductor supplier, Taiwan Semiconductor Manufacturing Company, electronically linked their supply chains so that Adaptec would see, in real time, changes in TSMC's capacity commitments, and TSMC would have total access to information about demand downstream from Adaptec.

By focusing its limited resources on collaboration with the right suppliers, Adaptec was able to reduce cycle times by half, increase customer satisfaction and slash inventory costs. Other benefits included increasing flexibility to respond to market demand, improved business relationships and more competitive strategic positioning for the future.

Are you ready?

The collaboration framework outlines how and with whom to collaborate, but a final question must be answered before a successful collaboration can begin. Are you and your potential collaborator ready for such a relationship? Three factors are indispensable in the effort to forge more effective collaboration: capability, commitment and trust.

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* Timothy Mould is a Boston-based senior manager in the Accenture Strategic Services practice. His work focuses on developing and implementing integrated value-chain strategies through eCommerce capabilities.
Edwin Starr, a partner in the Accenture Supply Chain Strategy practice, leads the firm's eProcurement and Strategic Sourcing practice. He is based in Chicago.