Agile supply chains are commonly employed in delivering particular value to NPD (New Product Development). The supply chains pragmatically and speedily support innovation and new products via planning, procurement, manufacturing as well as delivery. Notably, these are the nucleus processes typifying supply chains (Lambert, 2008; Lee, 2012). Supply chains support the processes defining NPD since they drive the related capital investment into production, as well as distribution, capabilities along with product launch dates’ critical paths. When suppliers are integrated into NPD cycles helps in enhancing product quality, reducing new products’ costs, facilitating product launches, and cutting given concepts into client development time (Chan, Lettice & Durowoju, 2012). Suppliers may be involved in the cycles by offering manufacturers product design ideas or taking charge of the designs of the systems or components that they supply. Besides, suppliers get involved in varied phases of NPD cycles. When they get involved in the earlier phases of the cycles, their utility regarding the coordination of process, product, and supply chain designs is rather considerable.
Regarding supply chains, integration entails the collaboration, as well as interaction, processes in which the stakeholders of specified supply chains team up to realize mutually beneficial outcomes (Cassivi, Hadaya, Lefebvre & Lefebvre, 2008). As well, the integration is largely defined as the joint effort put in connecting supply chain and function networks with respect to physical, information, and process flows. The typical classical supply chains lack the integration dimension since they depend on disconnected, or discrete, information flows (Childerhouse & Towill, 2011). The lack of the flows often result into the creation of excess supply and manufacturer inventories and slows down the reaction of the supply chains to changes in product demand.
Supplier integration and integrated supply chains are growing contemporary concepts. The integration is proving rather significant to business success in the contemporary market. That is largely because the market is defined by increasingly compacted production cycles and intricacy. The compaction of the cycles is driving global products, which are the products designed, as well as validated, by internationally dispersed, or discrete, teams. Notably, the teams include suppliers (Lambert, 2008; Lee, 2012). As suppliers take up increased responsibilities for increasing components of given manufacturers’ products, the manufacturers require them to interrelate with businesses and individuals across their businesses. The manufacturers do so to enhance productivity as well as reduce product non-compliance and recall risks.
Presently, many manufacturers are keen on involving suppliers in NPD cycles through supplier integration (Lambert, 2008; Lee, 2012). They are realizing that goal through various ways. First, they are linking own information systems with the suppliers’ information systems to enable them access each other’s information in real-time and accurately. Second, they are establishing dependable communication pathways between them and the suppliers. Third, they are establishing seamless connections between them and the suppliers in terms of strong customer-suppliers relationships and business processes. The connections are rather supportive of collaboration as well as interaction (Cassivi, Hadaya, Lefebvre & Lefebvre, 2008).
Supplier integration in the contemporary market represents a significant shift from the traditional market defined by adversarial customer-supplier attitudes (Childerhouse & Towill, 2011). It is largely focused on NPD, enhancement of product quality, incorporation and processing of specification changes, design support, and technological exchanges (Lambert, 2008; Lee, 2012). As well, it is focused on the combination of external and internal linkages, which are based on information, to expand supply chain visibility. The visibility is associated with increased operational efficiency, improved resource productivity, and improved effectiveness in planning according to Barratt and Oke (2007) and Chan, Lettice and Durowoju (2012).
Supplier Integration and the Enabling Technology
Presently, there is an increasing assimilation of technology, especially information technology (IT), in strengthening supplier-customers linkages and supporting NPD (Golińska & Kawa, 2015; Kachitvichyanukul, Sethanan & Golinska-Dawson, 2015). IT assimilation is the capacity for diffusing and routinizing IT-based applications in given business functions, as well as processes according to Childerhouse and Towill (2011) and Seifert (2003). The diffusion, as well as routinization, happen across, as well as within, organizational borders, and facilitate the utilization of sophisticated IT applications such as e-business platforms by businesses.
Presently, there are various IT products aimed at supporting the linkages and collaborative NPD processes. Some of the products are used in ensuring that suppliers are involved in NPD early enough according to Siemens (2015). Others support NPD through the optimization of supplier collaboration, increasing the efficiency and security of data exchange designs, decreasing cycle times and costs through direct sourcing of materials, improving the management of particular supplier programs, and securing supplier integration (Seifert, 2003; Siemens, 2015).
NPD and Supply Chain Integration
In almost all industries, the capability of executing NPD processes rapidly is a significant competitive advantage source. Particularly, businesses that are capable of executing the NPD processes quicker than competition enjoy distinct advantages over competition since their extant models are evidently advanced and typified by the latest technological innovations (Chan, Lettice & Durowoju, 2012). There is a considerable correlation between functional integration and product innovation performance. The degree of a business’ cross-functional form of integration is considerably related to its NPD performance. As well, it is anticipated that supplier integration occasions enhanced production innovation performance.
Varied frameworks of supplier integration suggest that the successful supplier integration into product innovation cycles can give rise to particular benefits via enhanced access to particular technological applications. As well, the frameworks suggest that the successful supplier integration into product innovation cycles can reduce the time taken by varied NPD procedures (Childerhouse & Towill, 2011). The involvements of suppliers in the NPD procedures strengthen the connections between manufacturing and design, within suppliers as well as internally.
The involvements of customers in NPD procedures are dependent on the appraisal of given business’ weaknesses, as well as strengths, relative to own customers’ service requirements. During NPD, decisions that are formulation in the light of consumer organizations via inventories managed by vendors are capable of shortening the time taken to develop given products considerably. That is particularly evident in countries that post high customer NPD-involvement such as India.
Collaborative Innovation Models
Particularly, the integration is aimed at lessening NPD costs and levels of working capital as the leading priorities regarding supply chains (Childerhouse & Towill, 2011). Marked progress has been made in redesigning the models to address businesses’ need for increased flexibility and sensitivity to product mix changes and demand changes. Other concerns that have led to the continued redesigning of then models are related the performance of suppliers with regard to product quality, reliability, and risk. As well, the redesigning is motivated by a need to ensure adequate supply ability to suffice given product demands and support the launching of novel products effectively.
Unlike in the past, presently, supplier-customer collaborations are principally geared towards creating value and driving product innovation (Cassivi, Hadaya, Lefebvre & Lefebvre, 2008). Presently, organizations are collaborating by way of sharing, as well as exchanging, information, to address their weaknesses regarding product innovation. Some businesses are practicing e-collaboration, which entails internet-facilitated enterprise interactions (Chan, Lettice & Durowoju, 2012). The interactions are not simple sell or sell transactions but are structured relationships involving activities such as information integration and sharing, sharing of decisions, and sharing of resources or processes (Cassivi, Hadaya, Lefebvre & Lefebvre, 2008). There is a need to investigate the meta-concept of collaboration further in the context of supply chains since it is presently rather amorphous, allowing for many interpretations.
IT enables stakeholder collaboration in supply chains. The collaboration is a critical factor in relation to the facilitation of information flows among the stakeholders. Presently, e-collaboration is increasingly essential in facilitating coordination of diverse activities and decisions beyond specified transactions among the stakeholders, including suppliers and own customers (Childerhouse & Towill, 2011). That is quite evident over inter-organizational IT systems such as the internet. Marketplaces that are defined as being B2B provide strong IT aid to the enterprises that implement well-defined SCM (Supply Chain Management) processes.
The structures of information exchange of given supply chains that are hinged on B2B platforms help in sharing information with every enterprise at the supply chains’ nodes. The structures strengthen the connections between the enterprises. The structures enhance the supply chains’ operational efficiencies (Chan, Lettice & Durowoju, 2012). Various enterprises have since introduced B2B marketplaces to enhance their supply chains’ operational efficiencies, enhance e-business inclusively, and modify the supply chains’ management approaches, or styles, accordingly.
Manufacturers are increasingly engaging third party researchers, customers, and suppliers based on varied models to enhance NPD speed and lessen the related costs (Seifert, 2003). Most of the manufacturers have adopted collaborative models with own customers, as well as suppliers, to enhance own innovation investment value. Notably, the varied models are increasingly being strengthened through the improvement of their agility as well as integration into extant models of supply chains (Chan, Lettice & Durowoju, 2012). Some of the models help manufacturers team up with own suppliers in chain design, or product development. Others help manufacturers team up with own suppliers in support chain, or product support.
Other models help manufacturers and own suppliers to extend the strategic alliance and chain concepts as they try to optimize their performances especially in relation to NPD. They seek to optimize the whole of their systems while sharing the attendant gains (Golińska & Kawa, 2015; Kachitvichyanukul, Sethanan & Golinska-Dawson, 2015). Collaborative firms or enterprises often grow into knowledge-based entities that utilize their partners’ intellectual strengths, capacities, and competencies in growing their competitive advantages to optimize their overall performances, including global NPD performances.
In nearly all industries, the capability of executing NPD processes swiftly is a significant competitive advantage source. Responsive supply chains are commonly employed in delivering particular value to NPD. Supplier integration and integrated supply chains are growing contemporary concepts. The integration entails collaboration, as well as interaction, processes in which the stakeholders of particular supply chains team up to realize mutually advantageous outcomes. At the moment, many manufacturers are involving suppliers in NPD cycles through supplier integration by linking own information systems with the suppliers’ information systems to enable them access each other’s information in real-time and accurately. Right now, there is an increasing assimilation of technology in strengthening supplier-customers linkages and supporting NPD. There is a need to explore the meta-concept of collaboration further as it is at present fairly amorphous, allowing for various interpretations.