Abstract
There are greatchanges in terms of advances in technology, information revolution, globalizationof markets, which promotes the prosperous and vigorous development of worldeconomics. Nowadays, business environment emerges the need for organization tocontinuously coordinate supply chain resources so as to maintain and reinforce theirability to compete successfully. Unfortunately, in the early stages of supplychain developments, some organizations do not acknowledge the function ofcoordination, they often eliminate those suppliers or customers that areclearly not suitable. They may not have the capabilities to serve thecustomers, to be distant, not well aligned with the development of organizationalperformance, impairing the competitive advantage of organization.
The purpose ofthis research is to demonstrate an analysis of coordination of supply chain inorder to provide a modular structured management tool for planning, implementingand measure the effectiveness of supply chain activities, in relation tooverall organizational performance and business strategy. Supply chain coordinationaims at improving supply chain performanceby aligning the plans and the objectives of individual enterprises. In addition, the coordination of supply chain maintainsand facilitates the supply chain process. As we know, the supply chain process is a corebusiness process of major importance for the realization of business strategy.It determines numerous key performance indicators of an organization and has amajor impact in its profitability and competitiveness. Therefore, supply chaincan be considered as maybe the most suitable operational framework for a transformationprocess to be based on. Furthermore, it is beneficial to establish anintegrated supply chain. This coordination mechanism is concerned with theintegration of core process across organizational boundaries through improvedcommunication, alliance, partnership and cooperation. It makes use of the newtechnologies to improve information flow and coordinate the flow of physicalgoods between trading partners. However, effective supply chain coordinationreflects the satisfaction rate of all interested parties and reliability ofoperations, as well as to reflect quantities like openness, flexibility,adaptation and quick market response.
This research willpresent the insight and practice of coordination from four aspects. At first,it will analyse the potential impact of lack of coordination, which isconcerned with poor communication of expectation, difficult management ofinterpersonal relationship, lack of trust etc. Meantime, the coordinationtheory is applied to provide a theoretical basis to consider how companiesmanage good coordination across the supply chain. In addition, this paperexplains the management levers applied in achieving a coordinated supply chainby examining strategic, process and operational components. It furtheridentifies the importance of relationship for the effective supply chainmanagement. Furthermore, this research indicates the practical management stepsto produce a better-coordinated information and inventory control system. It isinterrelated with order processing, inventory management, production,distribution and customer service. At last, it presents a supply chainoperation reference model (SCOR) to acknowledge a generic framework formeasuring supply chain performance and identifying areas for improvement.
Key Words: supplychain, supply chain coordination, competitive advantage, supply chain process,integrated supply chain, relationship, , SCOR model
Introduction
Coordinated upstreamand downstream integration in the supply chain can improve and differentiatesupply chain performance (Frohlich and Westbrook, 2001). In manufacturingcompanies, managing capabilities and resources across companies boundaries’becomes increasingly important and, therefore, should be an important elementin manufacturing strategy. This, however, presumes that firms integrate theirproduction and distribution networks, instead of merely the resources of anindividual company. However, an integrated supply chain system is not alwaysthe main interest of individual members of the system. Consequently, supplychain coordination mechanisms are needed to change the behaviour of individualpartners in the supply chain to improve supply chain performance (Li and Wang,2007; Dyer and Singh, 1998).
Obviously, Supply chain managers are increasingly recognising the need toeliminate supply chain inefficiencies, and align the decisions and theirexecution more closely between the trading partners in order to achieve balancebetween supply and demand.