Small businesses are reluctant to cooperate and collaborate in global supply chains because of not understanding the benefits and problems with them. Just the fear of unknown risk can paralyze a small business owner from taking action. Lack of trust and understanding supply chain partners’ standards can also result in anxiety. Yet, the future of small business in part depends on understanding the benefits of working together in global supply chains. So what are the benefits of global supply chain partnerships?
Jüttner & Maklan (2011) explained a relation exists between supply chain risk management and supply chain resilience. Juttner and Maklan found supply chains with flexibility, visibility, velocity, and collaboration can contain supply chain risks. Flexibility allows members greater choices for finding materials and needed services. Flexibility also improves bargaining power with suppliers. Visibility helps prevent non-availability issues and improves the ability to meet revenue and cost targets. Velocity gives supply chain partners the speed they need to exploit emerging opportunities. Collaboration allows supply chain partners to share capital and use complementary skills to prevent breakdowns. In short, supply chain management makes supply chain partners more resilient to risk.
Another benefit from working in global supply chains comes from improving corporate social responsibility. Spence and Bourlakis (2009) showed corporate social responsibility improves from collaborating in supply chains. Business dealings need open and honest relations in which supply chain partners can trust one another. Preserving good corporate social responsibility affects the entire supply chain and needs an open and honest partnership.
Does it make sense for your company to engage in social networks to find global supply chain partnerships? What concerns do you have about finding good global supply chain partners? Want to learn more. Please tell us if you like our blog.
Jüttner, U., & Maklan, S. (2011). Supply chain resilience in the global financial crisis: An empirical study. Supply Chain Management: An International Journal, 16(4), 246-259. doi: 10.1108/13598541111139062
Spence, L., & Bourlakis, M. (2009). The evolution from corporate social responsibility to supply chain responsibility: The case of Waitrose. Supply Chain Management: An International Journal, 14(4), 291-302. doi: 10.1108/13598540910970126