Internal Integration for Supply Chain Coordination

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Internal (within the firm) Integration for Supply Chain Coordination

Working together across functions or departments is called ‘Integration’ (Min, 2001). The degree of this internal integration determines the coordination within the supply chain. Several aspects that impact integration within an organization are discussed in the four articles. The themes discussed are • Resistance to change due to competing commitments (Kegan, Lahey, 2001) • Reward structures that promotes organization’s goals (Mentzer, 2004) • Performance metrics that aligns with supply chain strategy (Mentzer, 2004) • Inter-functional coordination through standardization (Min, 2001) • Managing the transition - change of sales force’s focus from transactions to relationships (Min,Graver,2001) • Trust and commitment, a common theme discussed in all articles.

While working on internal integration, resistance can come either from individuals or from departments. ‘Competing commitment’ is identified as the reason for individual resistance (Kegan, Lahey, 2001). Competing commitment is detrimental to organization’s common goal. Authors suggest several steps to identify that competing commitment and the big assumption that enables it. Once they are identified, designing effective remedial steps would go a long way in mitigating the associated risks. This exercise involves a greater level of trust. If individuals don’t trust enough, they would not be willing to reveal and nullify their competing commitment. Resistance to change from various departments can be addressed by identifying and establishing goals that fulfill common interests of different departments (Min, 2001). The fulfillment of common goals can be seen as a reward for the department’s cooperation, which leads us to our second theme.

Reward structure that is aligned with the supply chain’s overall goals will increase coordination within the chain (Mentzer,...
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