It's widely acknowledged that the ability to collaborate with your trading partners up and down the supply chain is a prime determinant of business success.

The management consultants hammer this point home all the time in their speeches and articles. And the leading practitioners like Wal-Mart and Cisco Systems have the numbers to prove that effective supply chain collaboration translates directly into superior financial performance.

But knowing that collaboration is a worthy goal to pursue and actually setting the processes in place to achieve that objective are two entirely different things. That reality is evidenced in several of the feature articles appearing in this issue.

The report by Dr. Tom Mentzer and his research team at the University of Tennessee clearly articulates the nature of the collaboration challenge. Based on research into the real-life experiences of supply chain practitioners, the team has identified certain obstacles to effective collaboration that need to be overcome. While they are clearing those hurdles, the Tennessee study found, companies need to put in place certain enablers to facilitate the collaborative process. Once these two efforts are aligned, companies will begin to see the true benefits of supply chain collaboration.

And those benefits can, in fact, be substantial. As Ron Ireland and Robert Bruce of Benchmarking Partners point out in their article, the early results of one key collaboration initiative called CPFR (Collaborative Planning, Forecasting, and Replenishment) have been impressive. The authors cite results from pilot projects that show dramatic revenue increases in targeted product categories, large-scale inventory reductions, and healthy improvements in gross margins.

Although CPFR is largely aimed at the retail industry, companies in all business sectors can turn to another emerging technology—the Web—to foster their collaboration initiatives. In their "primer" on the Internet, Steven J. Kahl and Thomas P. Berquist of Goldman, Sachs & Co. describe how companies can use the Web to collaborate not only with their traditional supply chain partners (suppliers, carriers, customers, and so forth) but also with their extended partners like banks and customs authorities.

One underlying theme running through these discussions is that technology is a wonderful enabler to supply chain collaboration. But it is just that—an enabler. Before real collaboration can happen, a culture change needs to take place. Openness must supplant secrecy. Trust must replace suspicion. "We win" (not "I win") must become the controlling philosophy.

For many organizations, the requisite culture change can be a wrenching experience. But it's a pain that must be endured if they are to partake of the bounteous benefits that collaboration can deliver.

617-558-4468, fquinn@cahners.com