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The Dark Side of Collaboration

Have you ever considered collaborating with your competition to both enhance and improve your supply chain? In this article Nick Allen, the author, describes how European supply chain executives are looking into this innovative practice. Allen writes that future progress on collaboration relies on honing the creativity of supply chain professionals to realize the potential that exists outside traditional activities, to venture into the dark side: Collaboration between active partners within a supply chain is seen as an essential step to creating competitive advantage. Working together, sharing information and close dialogue can bring significant efficiencies and cost savings for supply chain partners. This sounds simple enough, but what happens when the collaborating parties are competitors? How can this possibly work? The inherent competitive nature of business throws up a series of, principally, psychological barriers to exploiting a rich seam of efficiency improvement for supply chains, the collaboration between competing companies. There are many instances where such collaborations make sense and the rewards can be great, but there are critical issues to consider and a new, enlightened way of thinking is required. Allen outlines a multitude of these critical issues which should be considered. For instance, how to create mutual advantage and how companies can share risk and rewards throughout these collaborations. Professor Alan Waller, chairman of ELUPEG and CP for supply chain innovation at Solving International, is quoted at the end of article warning that “One barrier is finding the right partner. It’s quite difficult. Not just finding a partner where the economic benefits are there, but also where this is a good cultural fit.”

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