8.3.5 Summary
An integrated supply chain cannot be made reality without a strong partnership between firms at different levels of the supply chain. The emerging business models based on partnership between supplier and manufacturer, manufacturer and 3PL firms, retailer and supplier, and distribution integration were analysed and it was evident that strategic partnering is one of the key requirements for harnessing the power of all firms in the supply chain. Unwavering commitment from top management, equitable risk and profit sharing mechanisms and state of the art IT systems are the basic requirements for any such partnership.
While the benefits of strategic partnering are emphasised and a few examples of emerging business models are available, most surveys reveal that the state of the corporate landscape is yet to be mature enough for most firms to embrace this new business model. The KMPG (2001) survey reveals that in spite of the fact that 80% of the surveyed firms acknowledged the need for a totally integrated business enterprise, 65% of the firms in the USA were found to still maintain traditional centralised or decentralised company structures. This is a serious hindrance for effective partnership models as successful partnership can be only implemented when business processes and information are integrated across the functional boundaries within the firm and with partners in the supply chain.