SUPPLY CHAIN INTEGRATION & COLLABORATION

Supply Chain Integration and Collaboration
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Supply Chain Integration and Collaboration
Porter’s value chain theory
A value chain is said to be the specific activities or processes carried out by a firm which is based on a certain industry in order to deliver valuable goods or services to their customers in the market. Michael Porter provided that, an organization is a system made up of smaller units known as the subsystems (Christiansen, 2016). Each subsystem has inputs and produces outputs which are dependent on other subsystems. Porter argued that the costs and profits of an organization are determined by how the value chain activities are carried out. He further categorized the activities into two. The primary activities which include the inbound and outbound logistics, marketing and sales, the services and the organization’s operations (Christiansen, 2016). On the other hand, the secondary activities include the infrastructure, HRM, procurement and the technological development.
The contribution of Porter’s work on supply chain literature
Initially, the concept of the supply chain was used primarily by the individual firms. However, it has currently extended to cover the entire supply chain and most distribution networks. The extended form of supply chain forms the value system (Christiansen, 2016). Value system allows the value chain of the supplier, that of the firm, the firm’s distribution channel and the value chain of the firm’s customers to work as a single unit.

Functions of companies in and out of the supply chain and the integration and collaboration
Supply chain integration and collaboration takes place through the sharing of information between different management systems. Companies in a supply chain work together aiming to improve the efficiency of data sharing. Additionally, integration and collaboration act as an interactive system through which different organizations form joint relationships which are responsible for multi-company decision making (Christiansen, 2016). As such, supply chain integration and collaboration helps the organization in planning and forecasting future demand more efficiently.
References
Christiansen, B. (2016). Handbook of research on global supply chain management. Hershey, PA: Business Science Reference, an imprint of IGI Global