(2011; 9 pages)
Supply chain integration is a performance-improving approach that develops seamless linkages between the various actors, levels, and functions within a supply chain to optimize customer service. The objectives of supply chain integration are to improve efficiency and reduce redundancy while also enhancing product availability. Supply chain integration strives to better connect demand with supply, which can both improve customer service and lower costs. However, it is not always possible to simultaneously achieve all these various objectives; a designer may need to make tradeoffs and balance competing priorities while working toward the ultimate goal of better serving customers.
Clarification of roles can help improve communication and accountability.
Supply chain integration needs to make overall supply chain performance better. To do so, we examine the features that contribute to a well-functioning supply chain and, as a corollary, the characteristics exhibited by a well-functioning supply chain. A well-functioning supply chain should not be characterized simply by whether or not products are delivered in the same trucks or stored in the same warehouse. These design features may be important but they are not the fundamental traits that need to be in place to improve customer service. Rather, well-functioning (integrated) supply chains are characterized by clarity of roles and responsibilities, agility, streamlined processes, visibility of information, trust and collaboration, and alignment of objectives. This paper describes these characteristics and how they contribute to a seamlessly linked supply chain.