HUMAN FACTORS AND SKILLS

Barriers to effective participation in supply chains often have more to do with cultural and interpersonal issues than technical issues. Successful participation in integrated supply chains requires a high level of interpersonal skills. As is well known in the business community, long-term personal relationships between customers and suppliers are important in building a stable and growing business. Person-to-person relationships help to form bonds of trust that enhance credibility on both sides. Among the most important relationships are those between day-to-day decision-making peers at all levels of the customer and supplier organizations. Design engineers, sales executives, and logistics experts, to name a few, from each of the key participants should be working together to increase the extent of integration and mutually increase the efficiency of their processes and functions. Successful integration requires tight, cohesive relationships based on common goals between individuals at many levels and in many functions throughout the supply chain. For example, supplier manufacturing executives should develop strong relationships with the customer's procurement executives to ensure that they thoroughly understand each other's needs and capabilities. This understanding is crucial for effective decision making, meeting customer needs, and balancing available resources.

In another aspect of supply chain integration, it is becoming increasingly common for OEMs to give their assembly line operators the authority to release shipments from suppliers, allowing the operators to interact directly with their counterparts in the supplier company instead of through the formal organizations. To ensure quality, the people responsible for making parts are sometimes sent to customer facilities to gain an understanding of the customer's problems and needs. All of these interactions require trained employees who can carry out these responsibilities efficiently and constructively.

Supply chain integration and the implementation of new technologies must be planned and handled with care because all of the participants in a supply chain are independent entities. Participants tend to resist changing their work practices, especially if the benefits are perceived to be greater for other participants. These difficulties can be compounded by the human tendency to resist technologies that cannot be easily implemented. Societal beliefs in individualism and autonomy generally run contrary to the ideas of information sharing, openness, win-win negotiations, and sharing of risks and rewards, all of which are important aspects of successful integration (Baba et al., 1996). Thus, considerable leadership and people skills are necessary to achieve successful supply chain integration.



The National Academies | 500 Fifth St. N.W. | Washington, D.C. 20001
Copyright © National Academy of Sciences. All rights reserved.
Terms of Use and Privacy Statement