The role of supply chain partnering integration in mass customization (Essay Sample)

The role of supply chain partnering/integration in mass customization
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The role of supply chain partnering/integration in mass customization
Introduction
In today’s competitive production environment, businesses and manufacturers have been forced to create and offer products which are both customized and cost efficient. This practice of production of customized goods in an intensely competitive environment has led companies into implementing robust supply chain management procedures to boost their competitive advantage and performance altogether. According to Zebadarst et al. (2013, p.81), “Supply chain management in customer-oriented environment is pursuing the transition from traditional supply chain into concurrent flexible and efficient one”. This flexibility of operation his aspect makes them close to those produced in mass customization. For that, mass customization (a marketing and manufacturing technique that combines the flexibility and personalization of “custom-made” with the low unit costs associated with mass production) has become pivotal in creating custom-made products which are cost-efficient. To achieve this mass customization efficiently, companies are forced to embrace a supply chain integration that focuses entirely on the needs of the customer. Therefore, supply chain partnering/collaboration/integration is the production geared towards the collaboration with the internal and external stakeholders of the organizations to maximize profits and create production capabilities. Supply chain involves the processing events starting from the acquisition of raw materials to product delivery. Push processes refer to the processes started and performed in anticipation of the order of the customer while pull processes are those that are triggered by the customer’s order. In mass customization, customer related processes are more considered seeing as the goal is to acquire insights which fuel the creation of products which meet the dynamic needs of the customer. Either way, partnering in the supply chain plays a significant role in mass customization as it provides the manufacturer with the insights required in making informed decision making in mass customization. According to Lai et al, (2012, p. 20) “manufacturers can gain strategic capabilities in the market by integrating both internal and external resources from supply chain partners.” With this integration comes the strategic information that is pivotal in spearheading the innovation that is key in mass customization. Fundamentally, in business operations management, supply chain collaboration acts as the forerunner of mass production.
For this paradigm of production to happen, companies require a greater synchronization of the whole supply chain. This synchronization of supply chains entities necessitate significant cooperation, therefore is pivotal in enabling mass customization. Mass customization requires flexibility and fast responsiveness. In the ever changing marketing and supply environment, people, processes, technologies, and units should be reconfigured to provide the services that suit the demands of the customers. When the homogenous markets have become heterogeneous and fragmented, customers are free to express their needs. With this flexibility and the increased speed of exchanging information, mass customization comes in handy in supplying the specific needs of each customer with a “near, mass-production efficiency”. This improved paradigm of manufacturing encourages higher profit margins and better customer satisfaction for individuals. Studies have established that, mass customization challenges such as competition and demand can slow down the process and cost the company of its costs. Therefore, manufacturers involved in mass customization should interact actively with both suppliers and customers to acquire the information, resources, and knowledge that is pivotal in maintaining leader innovativeness and positioning that retains the company’s competitive advantage. Definitively, integration in supply chain creates an environment of applying mass customization to reduce the unnecessary costs and processes required in the innovative production.
Mass customization
In business operations management, mass customization refers to employing the mix of custom-made products and low cost of unit that is associated with mass production. It is the ability to offer a comparatively high volume of products to a large market without necessary trade-offs in the quality, delivery, and the cost of the product. Typically, it is the cost of producing a single-batch of customized products at the same speed and cost of using the traditional method. These methods have been deemed as important in improving “organizational capability by helping them to gain new and innovative forms of competitive advantage”(Lai et al. 2012, p.446). However, for mass production to be successful, two requirements are key. Firstly, one should be in a place to identify the opportunities of customization that are valuable to the buyer. Secondly, the producer should be in a place to achieve manageable structure and level of cost.
Fundamentally, mass customization capacity is divided into four aspects. High-volume customization is termed as the ability to aggregate the individual demands of a customer into large-batches then delivering the customized products at volumes as large as those of mass production. Here, cost is cut significantly because the embraced method of mass production cuts cost thus maximizing efficiency. The second aspect is the customization of cost efficiency. This refers to the capacity to produce customized items for the customer at a price that is similar to that is similar to that found in mass production. Thirdly, customization responsiveness refers to the capacity to cut down the total time used in delivering the products in a bid to respond to the customization demands quickly. Lastly, the customization of quality refers to the capacity to manage and sustain a consistent level of quality in every product that is produced by the firm.
That said, mass customization can be built through the appropriate integration of internal and external factors.
Supply chain partnering
Supply chain partnering, commonly termed to as supply chain collaboration is the degree to which entities collaborate strategically with all the partners in the intra and inter organizational processes to attain the efficient and efficacious flow of services, information, decisions, and products with a goal of maximizing customer value. Supply chain management is pivotal in business operations management as it provides the framework for better controlling, planning, and coordination of all business activities. Essentially, supply chain sees to it that materials flow efficiently and effectively from the supplier to the end users. In the typical operational environment, managers attempt to establish collaborative alliances with other companies to maximize the output of the processes and acquire production efficiency. Three types of supply chain collaboration exist. The internal integration provides integration of the internal processes and functions. the cross-functional relationships, internal relationship management, and joint decision making processes established formed in the end facilitate the acquisition and dissemination of organizational knowledge into designs , processes, and end products which lead to a more coordinated internal operation and response to the changes happening in the marketplace. On the other hand, the external factors are divided into supplier and customer factors.
Supplier integration refers to the processes of establishing lasting relationships with the external partners. According to Rajagopal et al (2009, p.653), “Supplier information flow is defined as the extent to which the supplier openly shares information about the future that may be useful to the customer relationship.” The suppliers offer the basis of operation and cooperation that lowers the It is the partnership with external entities to structure the inter-organizational practices and procedures to create a synchronized manageable cost incurred by the customer. Supplier integration generally entails the sharing of information, the creation of partnerships, and involvement of suppliers and other external parties in the development of the product. Strengthening ties with the suppliers necessitate manufacturers to obtain better goods from the suppliers and incorporate their suggestions and recommendations into business operations. The input of the suppliers comes in handy in creating commodities which are in line with current trends in the business arena(Zebardast et al, 2013). Also, having an ongoing partnership helps the involved parties in achieving mutually beneficial goals as the members liaise on the best processes to embrace. Moreover, creating close contacts with suppliers facilitate a smooth flow of all the elements required in the chain.
Customer collaboration entails customers only and focuses on information sharing, partnerships, and involvements that push for effective design and delivery of products. Customers are consulted upon in all phases of the supply chain to offer insightful information that would ensure that the manufacturers create goods which are in line with their preference.
Demand uncertainty and competition in the supply chain
While in the business operation, managers and business operators face numerous challenges concerning conflicting market information which i...