Reputation: The value of genuine collaboration with suppliers and customers

Collaborative Planning, Forecasting and Replenishment (CPFR) is not a new concept, but it is more relevant today than ever before. And it must involve both suppliers upstream and customers downstream, says Noha Samara, Senior Director Analyst at Gartner.

CPFR is an attempt to move beyond transactional relationships with strategic suppliers and customers and build true collaboration, says Samara. This is especially important in today’s environment of extreme uncertainty, where supply chain partners need to make faster, more informed decisions.

According to Samara, companies face four major challenges when implementing collaboration in both upstream and downstream areas.

First, there is the question of who within the organization is responsible for CPFR efforts. Is it procurement or planning? Or is CPFR a completely separate function, as it might be in a larger company? Collaboration “is not a small task,” says Samara. “It’s not something you can do in your spare time.”

Second, there is a lack of resources to support CPFR. The initiative requires large investments in time, money and technology.

Third, it is important to ensure that all participants benefit from the collaboration. “What do they get out of it?” asks Samara.

And fourth, it’s difficult to choose the suppliers and customers you want to work with. A company may have thousands of suppliers and it’s impossible to give them all the same attention. “It’s about focusing your efforts on the important areas and being selective about the areas you want to work with,” says Samara.

Particularly important today is the rise of the Chief Supply Chain Officer, who can lead a targeted CPFR initiative. “Research shows that companies are twice as likely to perform better when they incorporate insights from key partners into their decisions,” says Samara.

For more information about the next Gartner Supply Chain Symposium/Xpo, visit Click here.