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Part - VI

Both parties to the collaborative relationship must have the required capabilities to deliver their part of the agreed-upon business objectives. Imagine a components supplier who guarantees just-in-time daily deliveries but cannot even meet monthly delivery schedules.

If the capabilities exist, the commitment of management and resources is required to weather the inevitable disagreements over details and procedures. Without sustained executive support and resources (both money and people), the benefits of the collaborative relationship will lose visibility, and eventually the psychological and physical boundaries that separate companies will overcome the virtual links.

The fruit of capability and commitment will be a strong bond of trust-the strongest possible defense against all threats to a productive collaboration. This trust is based on the healthy interactions of individuals over time and cannot be forced or rushed. As the trust grows, so will the rewards of the collaborative efforts.

Supply Chain versus Supply Chain

Throughout the 1980s and 1990s, under pressure from shareholders, customers and competitors, most companies were aggressive about improving internal efficiency. Now, with the emergence of the eEconomy and the drastic reduction in transaction and communication costs, it is time to look beyond the corporate boundaries.

In more and more industries, it is becoming apparent that the competitive field is no longer limited to company A versus company B. The game is now supply chain network versus supply chain network, with an increasing reliance on collaborative relationships to create links of value. It is a high-stakes game that requires caution when there is a significant investment of resources, proprietary information and time.

It is still neither feasible nor desirable to collaborate with all upstream and downstream supply chain participants. There is a way, as we have outlined in our analysis of collaboration, to improve the chance of success: Understand the factors that drive the depth and breadth of your relationships, identify the key components to structure each collaborative relationship and evaluate your readiness to collaborate.

When approached in this way, collaboration can be a story that ends with "happily ever after."

Concluded.

* 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.