Operations management assignment : Strategic supply chain management and its description on value of 3C’s

1.     Introduction

With the introduction of globalization, things are innovating and experts are continuously working on various models to take the benefit of globalization completely. The 3c collaboration model is one of them which include cooperation, coordination and collaboration in a project. The individuals and organizations involved or participates work together as a team. And strategic supply chain is a crucial part of an organization. Supply chain is the soul of any business organization. As per (Murray, 2012), the supply chain management functions at three levels- strategic, tactical and operational. At the strategic level about which this research is about, deals with higher level strategic supply chain management decisions for the whole organization. This study aims to discuss the strategic 3C’s that is cooperation, coordination and collaboration approaches which are being used to establish successful relationships and closer alignment of strategic intent in modern supply chains. This study also investigates and discusses the benefits and limitations of the collaboration of 3Cs in supply chain management.

1.1 Aims and Objectives

AIM: The aim of this research is to analyze and discuss the 3Cs of strategic planning and its collaboration with the modern supply chain management. It also aims to understand how fruitful this collaboration is.

Objectives: The objectives of this research are:

• To understand and analyze strategic supply chain management
• To  understand and discuss 3Cs of strategic planning
• To discuss the integration of 3cs in modern supply chain management
• To investigate the advantages and disadvantages of the integration of 3Cs in modern supply chain management
• To examine the challenges associated in associating 3Cs in strategic supply chain management.
• 

1.2    Structure of the report

The structure of this report is as follows:

Chapter 1 discuss about the introduction of the topic that is the strategic supply chain management and integration of 3Cs. The chapter also investigates the aims and objectives of this study.

Chapter 2, deals with literature analysis with the help of books, journal, magazine, websites etc. The report first analyses the strategic supply chain management, then it introduces the three Cs cooperation, coordination and collaboration, there advantages and limitations and issues and challenges associated in the integration of 3Cs.

Chapter3 deals with conclusion part, which is the summary of the report, which discusses the current status and future direction in this area.

2.     Literature Analysis

2.1  Strategic supply chain management

Supply chain is the soul of any business organization. As per (Murray, 2012), the supply chain management functions at three levels- strategic, tactical and operational. At the strategic level about which this research is about, deals with higher level strategic supply chain management decisions for the whole organization.  These decisions reveal the complete corporate strategy of an organization. The strategic supply chain includes product development, logistics, customers, suppliers and manufacturing.

Product development: At strategic level, the senior management has to decide upon which all products to manufacture and should be introduced to the customers. The management is required to state the strategic direction in this regard. After a product cycle matures it results in to declining sales and the company has to take decision whether to introduce a new range of products or to new version of same product will be introduced with some offerings. The firm has to take all such strategic decisions keeping in mind the objectives of the organization (Murray, 2012).

Customers: The management needs to take strategic decisions regarding target customer group for their products. Right segment of the customers is necessary to be determined to launch the products designed and manufactured (Murray, 2012).

Vendors: The strategic supply chain policies with regards to the vendors have to be decided on by the management. By decreasing the amounts of purchasing spend, the management can reduce the expenses for the company and increase the profits for the company. For leveraging company’s purchases, the management can select global suppliers to avail maximum discounts. But these strategic decisions should come under company’s objectives (Murray, 2012).

Manufacturing: According to (Murray, 2012), manufacturing at the strategic level of supply chain involves decisions that are related to infrastructure and technology that is required in manufacturing. The decision involves increasing production at available facilities. The decisions may involve sub contracting and third party logistics. The strategic decisions on manufacturing are generally based on forecasting and sales estimates of the products, and then the company decides that how the products are going to be manufactured.

Logistics:  As explained by (Murray, 2012), logistics operations acts as the key focus of the strategic supply chain management. The higher management is required to take strategic decisions on the logistics as order fulfillment is a prime function for the supply chain. The company needs to decide strategically on the mode of transport to be used, storage and warehouses and the distribution centers locations.  The company would strategically decide to appoint third party logistics for the above said requirements.

The strategic supply chain decision taken by the management should be according to the company’s objectives, and free from any biasness. The strategic decision are taken at the higher level, based on the company’s needs and requirements at the lower level and allows tactical and operational supply chain decisions (Murray, 2012).

2.3Cs cooperation, coordination and collaboration

(Denise, n.d.)The three Cs cooperation, coordination and collaboration, literary have same meanings and are used interchangeably. These three words describe how people could work together efficiently. But each of this term is different and has different meanings. The 3C refers to individuals working together in an organization to deliver services and innovations (Keast and Mandell, 2009).

According to (Kalaher, Brooks and Forbath, 2008), there are four pillars of the collaborative capability model 3C, and the four pillars are:

• People
• Process
• Platform
• And Program

The four pillars mentioned by (Kalaher, Brooks and Forbath, 2008), are the basis in the collaboration model. Any one missing from this four makes the application incomplete.

Below is a figure explaining 3c model and how the applications are segregated in three C’s. Cooperation consists of work flow, networking, information seeking etc. Coordination consists of meeting, documents, system etc and communication involves discussions, means of communicating etc. As per (Fuks et al., 2008), communication, cooperation and coordination forms a 3c model of collaboration.

Figure: The 3c model representing classification of applications.

Source: (Fuks et al., 2008)

Cooperation: As per (Denise, n.d.), cooperation is considered to be a trademark for corporate culture which means get along with the group. According to (Keast and Mandell, 2009), it is about sharing of information and expertise. It is kind of relationship where the participants are not so tightly, in fact loosely connected, so it results in to low contribution to relationship. It involves lower level of risks and rewards (Keast and Mandell, 2009). In this case the goals of the participants and the organizations involved are independent, and power and resources remains with the organization only. There is low risk and low reward with short time frame (Keast and Mandell, 2009).

 Coordination: In case of coordination the sense of interdependence is much higher among organizations. The participants in this case understand the need of working together to achieve the set goals (Keast and Mandell, 2009). According to (Denise, n.d.), coordination is more about efficiency. It requires higher level of commitment and dense relationship among parties. According to (Keast and Mandell, 2009) , it has medium connections and work is based on trust, and is formalized project based information is shared. The power in this case remains in the hands of the parent organizations. The goals are semi interdependent and projects are medium based. There exists joint policies and programs and resources are aligned (Keast and Mandell, 2009).

Collaboration: As per (Keast and Mandell, 2009). It involves much deeper and stronger interdependent relationship. In the words of (Scharge, 1990), coordination is defined as “collaboration is the process of shared creation: two or more individuals with complementary skills interacting to create a shared understanding that none had previously possessed or could have come to on their own. Collaboration creates a shared meaning about a process, a product, or an event. In this sense, there is nothing routine about it. Something is there that wasn’t there before”. According to (Denise, n.d.), collaboration is very different from the rest two Cs, coordination and cooperation.  It is not just about exchange of information but about using of information for innovation. It is not only about structural harmony, but is about divergent insight.

According to (Keast and Mandell, 2009)  collaboration is about strong and highly interdependent relationships. The parties involved have to understand that to achieve results they have think, act and operate radically. It is not just about making modifications at the edge but is about innovating systems and parties are involved in a high-risk and a unpredictable environment that can generate results which are significantly different from those intended originally. The power is shared but the organizations involved. The communication is frequent, and there exists negotiated shared goals (Keast and Mandell, 2009). It involves high risks and high rewards.

According to (Scharge, 1990), collaboration is determined interpersonally rather than structurally. Below is the table displaying all three Cs of of the collaboration model by (Keast and Mandell, 2009)

Table : Relationship continuum: characteristics of the 3Cs

 Source: (Keast and Mandell, 2009)

2.4  Advantages of integration 3Cs

According to experts, when the 3Cs are implemented strategically, then it could be it a effective and strong tool for social change. As per (Fuks et al., 2008), the 3c model is most widespread and used. The model is used as a tool for different analysis purposes. The benefits of integration of 3c model as per (Keast and Mandell, 2009) are as follows:

• Reduction in overlapping: Since the work is done in a team, with application of collaboration, coordination and cooperation, it reduces overlapping of work and its duplication.
• Expansion of opportunities: with the application of 3c, it is possible to expand opportunities and also to access limited resources in a better way.
• Efficiency and effectiveness : Application of 3C model also improves efficiency and effectiveness in work as work is done in a team (Keast and Mandell, 2009)
• Legitimacy in organization: The 3c model also improves organizational legitimacy.
• Problem Solving: According to (Keast and Mandell, 2009), the model is also helpful in resolving social and wicked problems and supports in the completion
• Lowering Research and development costs (Kalaher, Brooks and Forbath, 2008), as firms are using partners for innovations
• Superior capacity: (Kalaher, Brooks and Forbath, 2008), with 3c application, superior capabilities could be leveraged in a firm
• Knowledge accessing: (Kalaher, Brooks and Forbath, 2008), 3c model also is a graeat help in accessing contextual knowledge.
• According to (Kalaher, Brooks and Forbath, 2008)collaboration also helps in firm’s or organisation’s business strategies: Any successful firm intends to align collaboration efforts with their company’s strategies. As they are not focused only on wage arbitrage, but on increasing their business value, they grow more sophisticatedly with the application of collaboration over a period of time. Only poor performing firms are more concerned or focused only on cost issues.

2.5  Disadvantages of the integration of 3Cs

Tough integration of 3C model is beneficial in organizations but excessive application of collaboration could be disadvantageous too. The limitations of this model are as follows according to (Henry, 2008):

• Too much collaboration can create clutter. It may happen that the participants would not agree with each other’s views, what one finds important could be completely irrelevant to others. This can create inconsistency in the project.
• Egoism: Ego is another issue in integration of collaboration. Every participant wants their contribution to be regarded which is not possible.
• It is not possible that every participant can think in the same way as the other, according to (Denise, n.d.) “cooperation is important and so is divergence”.
• Too much cooperation could lead to socialization which is not healthy for high performance (Denise, n.d.).

Every coin has two phases, so both implementation of any model, there would exist both advantages and disadvantages so for the successful application of cooperation, coordination and collaboration model requires strategic thinking in a firm.

2.6  Challenges in the integration of 3Cs

According to (Keast and Mandell, 2009), the challenges dealt by participants in application of collaboration model is the requirement to align with the type of joint working relationship with the recognized purpose of the project. It requires that the cooperative efforts should be perfect in order to share information and expertise. For the successful completion of a project with the collaboration mode, all three cooperation, coordination and collaboration is essential.

In a survey done by Wipro (Kalaher, Brooks and Forbath, 2008), reveals that the management of innovation is changing. The research of Wipro tries to explain that how collaboration model could be utilized by different firm, after facing all the challenges. The challenge in collaborative innovation model is as follows:

• Outsourcing Mindset of the management: According to (Kalaher, Brooks and Forbath, 2008), collaboration is different from outsourcing and management should take care of this. It is not a tool for wage arbitrage, as partners involved in the project could not be considered as a means to cost reduction. It’s a wrong approach to handle outsourcing and collaboration in the same way as both has different objectives. Outsourcing is just about procuring thing at a cheaper rate, where as collaboration model involves more soft skills, it is about accessing knowledge sharing risks, leveraging innovative capacities (Kalaher, Brooks and Forbath, 2008).
• Management which does not consider the strategic role of 3c, makes a mistake, as it is not only about reducing cost. The efforts applied by the managers should be aligned with that of company’s strategies (Kalaher, Brooks and Forbath, 2008).
• Effective organization of collaboration:  if the collaboration is not organized effectively then the efforts are of no use. The participants should be treated as partners, and not just as procurement function ( Kalaher, Brooks and Forbath, 2008).
• Long term investment is required in developing collaborative capabilities effectively.

It the collaboration 3C model is used strategically then the model can be useful for the competitive advantage of the firm (Kalaher, Brooks and Forbath, 2008).

3       Conclusion

3.1 Current status

The 3c collaboration model is one of them which include cooperation, coordination and collaboration in a project. The individuals and organizations involved or participates work together as a team. And strategic supply chain is a crucial part of an organization. Supply chain is the soul of any business organization. As per (Murray, 2012), the supply chain management functions at three levels- strategic, tactical and operational. At the strategic level about which this research is about, deals with higher level strategic supply chain management decisions for the whole organization. This study discussed the strategic role of 3C’s that is cooperation, coordination and collaboration approaches which are being used to establish successful relationships and closer alignment of strategic intent in modern supply chains. This study also has investigated and discussed about the benefits and limitations of the collaboration of 3Cs in supply chain management.

In the words of (Scharge, 1990), coordination is defined as “collaboration is the process of shared creation: two or more individuals with complementary skills interacting to create a shared understanding that none had previously possessed or could have come to on their own. Collaboration creates a shared meaning about a process, a product, or an event. In this sense, there is nothing routine about it. Something is there that wasn’t there before”. According to (Denise, n.d.), collaboration is very different from the rest two Cs, coordination and cooperation.  It is not just about exchange of information but about using of information for innovation. It is not only about structural harmony, but is about divergent insight.

According to (Keast and Mandell, 2009) in spite of many benefits of collaboration, it is not a solution to all social and wicked problems. It is only a set of probable strategies to facilitate individuals and organisations to work along more efficiently. However, if this model is implemented sensibly and strategically, it could result into very influential and effective instrument for social change.

According to (Kalaher, Brooks and Forbath, 2008), there are four pillars of the collaborative capability model 3C, and the four pillars are:

• People
• Process
• Platform
• And Program

3.2 Future direction

Every coin has two faces, so as this 3c model too, if it is advantageous to a firm, then there are attached challenges too which are supposed to be sorted out by the management efficiently, then it be a boon for the company, as it to reduce duplication of work, reduces cost and increases efficiency.

In future, things will be faster and more competitive and would require more cooperation, coordination and collaboration of organizations and individuals, so managers should not confuse collaboration with outsourcing and should understand the strategic application of the model to improve the competitive advantage of the company.

For future direction of the application of this 3C model,  the firms are recommended not to confuse collaboration with outsourcing. According to (Kalaher, Brooks and Forbath, 2008), collaboration is different from outsourcing and management should take care of this. It is not a tool for wage arbitrage, as partners involved in the project could not be considered as a means to cost reduction. It’s a wrong approach to handle outsourcing and collaboration in the same way as both has different objectives. Outsourcing is just about procuring thing at a cheaper rate, where as collaboration model involves more soft skills, it is about accessing knowledge sharing risks, leveraging innovative capacities (Kalaher, Brooks and Forbath, 2008).Management which does not consider the strategic role of 3c, makes a mistake, as it is not only about reducing cost. The efforts applied by the managers should be aligned with that of company’s strategies (Kalaher, Brooks and Forbath, 2008).Effective organization of collaboration:  if the collaboration is not organized effectively then the efforts are of no use. The participants should be treated as partners, and not just as procurement function ( Kalaher, Brooks and Forbath, 2008) and long term investment is required in developing collaborative capabilities effectively. Any successful firm intends to align collaboration efforts with their company’s strategies. As they are not focused only on wage arbitrage, but on increasing their business value, they grow more sophisticatedly with the application of collaboration over a period of time. Only poor performing firms are more concerned or focused only on cost issues

Every coin has two phases, so both implementation of any model, there would exist both advantages and disadvantages so for the successful application of cooperation, coordination and collaboration model requires strategic thinking in a firm.

PE44

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