SUPPLY CHAIN MINDED

THIRD PARTY LOGISTICS (3PL) COLLABORATION

THIRD PARTY LOGISTICS (3PL) COLLABORATION

CONTRIBUTION BY CHUCK INTRIERI – CHARLES M. INTRIERI CONSULTING

In order to have a successful “win-win” partnership with your Third Party Logistics (3PL) provider you must avoid adversarial relationships and collaborate, as genuine partners, in the spirit of cooperation.

This doesn’t mean using “lip service”, but really working in concert for a value added relationship. Your goal is seamless integration. You trust your partner. You both want gain sharing from this relationship. You get to a point where you can “open your books” and share data about your companies to foster achieving the goals you both set together.

First, what is collaboration?

Collaboration is working together to achieve a goal. It is a process where two or more people or organizations work together to realize shared goals.  Note that collaboration is NOT cooperation, it is more than the intersection of common goals, but a collective determination to reach an identical objective by sharing knowledge, learning, and building consensus.

Collaboration is an attribute that cuts across many businesses and business processes.  We need to make it an intentional process and cultivate it into the company’s culture.

It all starts with how to be the leader in your own life, but then extends to learning the following skills outlining the building a great collaborative effort:

  • Build and maintain trust: Trust is a key element we all need to set aside vulnerability, but it is hard to build, and easy to lose.  It is not built on words, but through actions and evidence. When it works effectively you both can address the necessary issues to win.
  • Expect conflict to reach consensus: Conflicts are normal and require factual push backs in business. Work on these conflicts together and attain consensus. Be truthful and accountable to each other.
  • Embrace change: Change is the only constant in business, so make it your competitive advantage. Initiate change rather than react to it, and give clear instructions to help your partner understand why the change is necessary, and how it will make the situation better.
  • Establish a level of analysis, structure, and control: The challenge is to strike the right balance.  With none, things fall into chaos, but too much can have the effect of stifling innovation and creativity. A Service Level Agreement (SLA) with Key Performance Indicators (KPIs,) negotiated together, with agreed upon goals and objectives, such as Customer Service, IT integration, Cost Reduction, Continuous Improvement, Quality Standards and other subjects help put together “marching orders” for your collaborative effort. It gives you structure to work in harmony. It enables you to communicate frequently and measure your success. It can be changed by either party as the relationship changes and new goals arise.
  • Make decisions: In general, any decision is better than no decision. Usually a blended approach is the best, between independent decisions, and collaborative decisions factoring in the best team input.
  • Foster continuous communication: Communication is the glue that forms the bond between companies, and holds great companies together. Credibility is a required base. When you say you will do something, you do it. The more you communicate, the better the collaborative effort. If conflict arises, and it will, address it immediately and solve the issue together. Finger pointing does not help, but making decisions to avoid the conflict in the future does.
  • Provide recognition: Recognition drives motivation and human behavior, and human behavior drives results. Recognition validates people and their purpose. Give each other mutual recognition. If there are gains in your relationship, share them together.
  • Create learning experiences: We all have a desire to learn and grow. The best learning opportunities are experience and sharing. In today’s fast-moving digital business age, we face an entirely new environment for innovation and collaboration. The best companies are the best collaborators.

In the new networked world, more and more business will be done through collaboration within, as well as, between companies. This will occur for a very simple reason: the next layer of value creation, whether in technology, marketing, service or manufacturing, are becoming so complex that few companies or company departments are able to master them alone.

[blockquote style=”1″]If you continue to collaborate and it becomes a habit, you will succeed together. Take collaboration seriously.[/blockquote]

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