[8] 2002 e-business-strategies-for-virtual-organizations

Moving from e-business to i-business strategies in virtual markets
of sale data, the electronic transferral of orders can significantly
reduce the time, work, and costs required for order handling.
This benefit can be accessed by both parts, thus resulting in
reduced individual and total chain costs, and lead time
improvements.
It appears that the employment of various replenishment
strategies have a higher potential benefit for the retailer than for
the supplier. In order to leverage the obtainable benefits among
the SRC partners, the implementation of replenishment strategies
has to be aligned with other strategies. The simultaneous
implementation of joint operating standards and efficient
administration strategies, where the benefits are more leveraged,
can significantly increase the suppliers’ will to join an
efficient replenishment initiative. This problem is clearly depicted
in the following table, which describes the main reasons for
firms to undertake efficient replenishment efforts. While suppliers
expect primarily cost reduction, retailers conceive better
service from suppliers as their most important expectation.
However, without being embedded in an overall collaboration,
these two expectations are mutually exclusive of each other.
Table 5.5 Expected benefits from supply chain efficiency
Suppliers Retailers
1. Cost reduction 1. Better service from suppliers
2. Better service to retailers 2. Cost reduction
3. Better information flow 3. Better information flow
Another strategy for balancing the benefits throughout the
entire supply chain would be to further integrate the supplier’s
value chain with its own suppliers, thus ultimately considering
the entire industry value system as a single value added
chain.
5.5.4 Some examples of change
The importance of supply chain management is such that many
companies today are adding to the already extensive capabilities
of their enterprise resource planning systems with collaborative
applications that let them share data over the Internet. And a
handful of companies in the automotive, electronics, and
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