M5 P1

What is process integration

Sharing information and coordinating resources to jointly manage a process

Early Supplier Involvement

Involving key suppliers early in product design or inventory management to improve collaboration

Strategic Alliance Development

Building long-term, trust-based partnerships to improve supplier capabilities and performance

Silo Mentality

“I win, you lose” attitude that prevents departments or firms from working together effectively.

Lack of Visibility

Poor data sharing that leads to delays, higher costs, and inefficient supply chain decisions.

Lack of Trust

Reluctance to share information; overcome by small collaborations and internal trust building.

Lack of Knowledge

Limited training and understanding among supply chain partners, hurting coordination.

Bullwhip Effect

Demand fluctuations that increase as orders move upstream in the supply chain.

Causes of Bullwhip Effect

Frequent forecast updates, order batching, price changes, rationing, and shortage gaming.

Preventing Bullwhip Effect

Share forecasts, shorten chains, automate orders, and use stable, everyday pricing.

Supply Chain Integration & IT

Using ERP and blockchain systems to improve real-time visibility and coordination.

A manufacturer and supplier share production data in real time and plan deliveries together to reduce delays.

Process Integration

A supplier works alongside a manufacturer’s design team and manages its inventory at the factory.

Early Supplier Involvement

Two firms form a long-term partnership to develop new technology and share profits from improved performance.

Strategic Alliance Development

A company’s purchasing department focuses only on cutting costs, causing problems for production and delivery.

Silo Mentality

A firm has no access to supplier inventory data, leading to shipment delays and poor customer service.

Lack of Visibility

Two companies refuse to share sales forecasts because they don’t trust each other.

Lack of Trust

Employees across different departments don’t understand how their work affects the overall supply chain.

Lack of Knowledge

A small increase in store sales leads to large order spikes for suppliers further up the chain.

Bullwhip Effect

A distributor places huge end-of-month orders just to meet its sales quota, throwing off demand forecasts

Order Batching

A company shares real-time demand data with suppliers and stops using temporary discounts.

Preventing the Bullwhip Effect

A firm uses ERP and blockchain systems so all partners can see live data on orders and shipments

Supply Chain Integration & IT