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Effective customer-supplier EDI partnership is characterized by six congruence factors
Wednesday, April 11, 2012, 8:00 AM
The partnership between customers and suppliers in the electronic data interchange (EDI) sphere is generally seen to be influenced by six essential factors of congruence. High level commitments, implementing EDI integration at top levels of business, infrastructure, joint partnership, flexibility and open lines of communication are the factors that characterize the congruence of EDI partnerships. Customers place more weight on these factors than their suppliers. Suppliers are often forced into assimilating the needs of their customers, and for this reason, usually embrace the use of EDI in their organization. Studies have shown that the maximum benefits will accrue when the customer implements the EDI integration, and the supplier puts more capital into the necessary infrastructure.
Customers are more apt to value EDI higher in all six areas except for the joint partnership aspect. Suppliers and customers both place high value on joint partnerships. Several things are at play in the joint partnership, and trust is a primary component found in the relationship. Suppliers and customers must also be willing to develop teams and committees that will work together to ensure the success of both organizations. Ensuring that lines of communication are open, and that there are ample commitments by both partners, will provide for the future of the relationship.
The joint partnership aspect is also an essential component of the supply chain management system. Time is becoming more important for both sides. Implementing EDI to promote the delivery of goods and services will ensure that tight time parameters are adequately met. Many customers and suppliers are working together meet a host of their organizations needs. Both firms are affected by the market conditions, and working as a team can ensure the success of both businesses. There are many things that can be done as a team. Training manuals and technical assistance may be required by suppliers and customers. Product development and design is another feature of collaborative efforts at improvement. Customers and suppliers also need to work together to maintain adequate levels of stock at all levels of the supply chain and ensure that demand is met.
Managers can realize several things from the latest study on EDI integration. The selection, maintenance and retainment of suppliers is facilitated when managers rely on the information to choose trading partners. Though the traditional aspects of product quality, reliability and performance are still used to choose supply chain partners, there are other aspects that influence trading partner choice as well. Customers can rely on the concept of selective congruence to help them minimize the costs of trading and finding new partners. Using this information is essential when customers have a number of choices for their suppliers. Finding the best supplier depends on the willingness of suppliers to work with their customers in a number of ways. Suppliers should be open to ensuring they have the same understanding as the customer. A supplier should also be proactive and willing to invest in the future of the trading relationship.
Relationships between customers and suppliers are radically shifting. Whereas, most firms viewed this relationship as coercive, it is now being seen as participatory. Proactive suppliers can work with their customers to ensure the success of both firms.
Academicians have provided several tips when it comes to the idea of congruence as it pertains to EDI integration. The structures of both organizations can now be improved and supply chain management will be more effective.
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