Introduction.
In many business organizations, today, technology has played critical roles when it comes to communication, much more the processing of information from the suppliers to the retailers. Communication enables coordination among these parties, and this enhances the growth of business (Voigt and Karl, 2012 pp. 636). It allows proper implementation of logistics and procedures that enhance harmonization and management of a business. With the use of technological advancements like emails, images, links, phones, tracking systems etc these processes are achieved (Jingchan and Felix, 2012 pp. 12). This paper explores the importance of communication in enhancing supplier and retailer relationships, using the provisions of modern technology.
Literature review.
Supply chains are complex in nature, and lack of proper coordination in these activities may render the whole process unworthy (Thun, 2010). The processes spread over various functions that are interrelated and sometimes spread over lengthy horizons of time. The chains tend to increase if a business is complex i.e. involves several suppliers and service providers. The result is substantial risks in the running of a business and at times affects the relationship with the retailers. This occurs if the services are not rendered on time or are in not in proper status as ordered (Sanders and Premus, 2002).
The importance of supply chain management evolved in the early 1990’s and since then the concern has displayed an exponential growth in research (Lionel, 2011 pp. 32). The evolving dynamics in supply chain structure at that time posed challenges in system coordination between businesses, their suppliers and customers (Wunsch, 1995). Previously, supply chain management was viewed as efficient if the process aimed at cost reduction and reduced wastage of resources. Practices like globalization, reduction in the supply base despite the increased demand, and outsourcing continued to complicate and disrupt the process of delivery and procurement (Pujawan and Smart, 2012 pp. 2262).
Earlier literature on the issue reveals that there were considerable risks in supply due to price uncertainties, reliability and demand volatility. This demanded a close check in stock safety, inventory strategies, and close checks on hedging and contracts by the supply chain. Over time, with the innovation of modernized communication devices and improved mechanisms of delivery, the process became decentralized. There was a diversion from the element of cost and waste reduction to elaborate means of communication that would make the management of the supply process easier.
Scholars and business researchers developed various journals on this issue and revealed that the problem that was being experienced due to lack of synchronization, among the parties, which was triggered by lack of communication (Lionel, 2011 pp. 40). There lacked proper means and communication strategies that could manage the process and keep every party on the updates. There seemed to be a general limitation on the managerial roles in integration and harmonization of the intricate network of business relations. There was the essence to develop faster means of communication that could connect suppliers, businesses and retail customers (Milliken, 2012 pp.8).
Effective supply chain has many challenges when it comes to management. These challenges are usually in the form of the interests and demands of retailers and what the suppliers are ready and willing to produce and at what price (Voigt and Karl, 2012 pp. 641). The members of the chain cannot work independently: the suppliers need to know what the retailers need, or what is already in the market and how to improve on it. The retailers, on the other hand, need to be informed on what is available, the price and how to cope with market competition. This calls for information that can only be acquired through the use of proper means of communication. Technology has acted as the remedy for these challenges (Wunsch, 1995). It provides for information, through research, generates information and assist in transferring or communicating this information. The use of technology as a means of communication in the supply chain eases the complexity in the process and provides for dependency which builds relationships (Jingchan and Felix, 2012 pp. 16)
Modern technology has led to innovations in automated, rapid and complex means of communication, in business. For proper strategy and business development, communication must occur between the organization, its suppliers and customers. Communication must also occur within the key departments in the organization. This is inclusive of logistics, accounting, production, procurement and marketing (Ray, Ximing and Guang, 2012 pp.392). Communication is also relevant to other members in the supply chain such as warehouses and intermediaries, who may not directly link to the organization, but take part in the process. Communication is crucial for the overall functioning of the business system.
Material management.
This encompasses the processing of raw materials, works in progress and the amounts of finished goods. An organization incurs costs every time an item is handled for production. This implies that a proper strategy is to minimize on travelling to manufacturers, reduction of waste, pilferages and mishandling. Material management enables organizations to save significant amounts of finance of raw materials (Goknur and Turan, 2010 pp. 5143). Technology, in this part, plays a crucial contribution. The use of automobiles and emails, for example, assist in logistics communication. This enables the management to have proper records on the expected costs and to prospect on the period of delivery of goods. This facilitates the ordering process from the customers (Jean, Sinkovics and Kim, 2010 pp. 83). Communication through mails, texts and phone calls enables all the parties to be in consensus on the cost sharing strategy. This ensures that every party in the chain is comfortable by the provisions of the other parties. This in return builds relationships among the parties in the chain (Thun, 2010).
Order processing and management.
This entails acquisition of orders from retailers and customers, checking the status of all orders, filling the orders and availing the goods to the retailers. This processing also entails checking of inventories, invoicing and accounts crediting. The process is broad and complex, and if not properly automated, it may impact significantly on the customer perception. The process requires a lot of communication both from suppliers and from the customers. The suppliers need to confirm on the available commodities, time and price (Drake, 2000 pp.53).
The business requires this information for pricing strategy and time for delivery. The customers, on their part, need to know the price, time of delivery and the amount of goods. This implies a proper coordination and communication among these parties. Technology has also played a significant role to facilitate this process. This is by use of faster means of communication (Ulf and Jens, 2011 pp.452). The internet, for example, allows these parties to communicate regardless of language and time zones. This is by use of texts, language translation Software and online marketing provisions of communication. This creates trust that boosts supplier retailer relationships.
Supplier-retailer exchange process.
Communication assists in the exchange process between suppliers, businesses and their customers. This is in the form of packaging methods, delivery forms and storage. Businesses enquire for the interests of customers and provide this information to their suppliers. Technology has enabled the use of films and images that assist the customers in choosing from a variety of packaging provided by businesses (Pamela, 2011 pp.1096). This also acts as a marketing strategy for businesses whereby they communicate to customers on what they can provide. The customers provide their choice to the businesses which later forward this information to the suppliers. Communication in this case is vital in that the customers expect the business to deliver their choice. The businesses also expect the suppliers to supply what they order and using the proper means of delivery. The modern technology has provided means that can be used in tracking deliveries like GPS (Wardrope, 2002). With communication, the retailers have confidence and trust form the suppliers. This creates trust in the supply chain processes.
Collaborative joint involvement.
Communication in the supply chain process assists in innovation and development of products. The use of images, as earlier indicated, provide joint product development whereby the retailers integrate information provided and cross examine it for further developments or changes (Jean, Sinkovics and Kim, 2010 pp. 72). With cross harmonization among these parties, there is the creation of long tern cooperation and equal sharing of benefits and risks. This enables success of the chain and enables long term relationships. In addition, this boosts coordination whereby the partners are imperative to risk avoidance and mitigation and develop maximization of revenue strategies. This is only facilitated by proper communication using technology advancements (Wardrope, 2002).
Conclusion.
Communication is vital in intensifying the commitments that exist in the supply chain. This enables relationship performance and maintenance. Communication is a prerequisite on commitment and trust building in the supplier-retailer relationship. It builds a sense of flexibility whereby every party gets informed on any developments or changes. It also develops dependency that is crucial in developing relationships, in the supply chain. It allows coordination across the supply chain functions integrates procurement and also facilitates the production and distribution (Wardrope, 2002). Technology has been on the forefront in making communication effective in the chain. This is through advancements in faster and convenient means that facilitate the process. Technological developments in the recent past have enabled growth in the relationship among the partners. It has provided for fast adjustments, innovations, pricing strategies and deliveries that boost the relationship (Thun, 2010).
Reference.
Drake, M. A., 2000. Technological Innovation and Organizational Change Revisited. Journal of Academic Librarianship, Vol. 26(1).
Goknur, A. A. & Turan, E., 2010. Supply chain performance measurement: A literature review. International Journal of Production Research, Vol. 48(17).
Jean, R., Sinkovics, R. R. & Kim, D., 2010. Drivers and performance outcomes of Relationship Learning for Suppliers in Cross-Border Customer-Supplier Relationships: The Role of Communication Culture. Journal of International Marketing, Vol. 18(1).
Jingchan, L. & Felix, T. S., 2012. The impact of collaborative transportation management on demand disruption of manufacturing supply chains. International Journal of Production Management, Vol. 50(9).
Lionel, B., 2011. Functional and Dysfunctional conflicts in retailer-supplier relationships. International Journal of Retail& Distribution Management, Vol. 39(1).
Milliken, A. L., 2012. The Importance of Change management in supply chain. Journal of Business Forecasting, Vol. 31(2).
Pamela, D., 2011. Towards a Contingency theory of collaborative planning initiatives in supply networks. International Journal of Production Research, Vol. 49(4).
Pujawan, I. N. & Smart, A. U., 2012. Factors affecting schedule instability in manufacturing companies. International Journal of Production Research, Vol. 50(8).
Ray, C., Ximing, S. & Guang, L., 2012. Are supply-chain relationships more influenced by buyer-supplier relationships or the business environment of the country itself? Evidence from the ‘China-Australia’ trading relationships. Asia Pacific Business Review, Vol. 18(3).
Sanders, N., R. & Premus, R., 2002. IT Applications in Supply Chain Organization: A link between Competitive Priorities and Organizational Benefits. Journal of Business Logistics, Vol. 23(1).
Thun, J., 2010. Angles of integration: An Empirical Analysis of the Alignment of Internet-Based Information Technology and Global Supply Chain Integration. Journal of Supply Chain Management, Vol. 46(2).
Ulf, E. & Jens, H., 2011. Retailers’ management of corporate social responsibility (CSR) in their Supplier Relationships-does practice follow best practice? International Review of Retail, Distribution & consumer research, Vol. 21(5).
Voigt, G. & Karl, I., 2012. Supply chin coordination with information sharing in the presence of trust and trustworthiness. IIE Transactions, Vol. 44(8).
Wardrope, W. J., 2002. Department Chair’ perceptions of the importance of Business Communication Skills. Business Communication Quarterly, Vol. 65(4).
Wunsch, A. P., 1995. Integrating Business Communication Skills into a Buyer-Behavior Course Project. Business Communication Quarterly, Vol. 58(1).
