Collaborative Planning Forecast Replenishment an Integration of Supply Chain Management.
Supply chain is the flow of goods from the point of origin to the destination with the efficient use of resources. In the supply chain management CPFR is one of the major technique that use to integrate all the strategic partners that are link with the organization to fulfill the customer demand. The main objection of the CPFR is to enhance the efficiency level of the organization by sharing the information, resources, reduction in inventory cost, logistics and transportation cost and increase the availability of resources to the customer. CPFR provides supplier and retailers to share the information which helps for forecast as well as maintaining inventory on schedule basis. Following are the model of CPFR: The four key main elements are strategic & planning, Demand and Supply Management, Execution and Analysis. The first prior of organization is to build up the strategies with their vendors by collaborating arrangement on mutual level which includes setting goals and significance of the relationship. Another aspect include joint business plan which includes promotion, inventory policy, store openings/ closing and product introduction. The output of the strategic & planning is the identification of each assigned role along with the measurement. The measure benefit is to commitment of both the parties and willingness to share the information and business risk. Demand & Supply is management is another key element of the CPFR which is to manage the inventory for uncertain demand. Therefore, point of sale has been used for future demand to fulfill the order, inventory positions, transit lead times, shipment quantities and other factors. After the acknowledgement of product requirement and all the other factors it’s time to execute the material which involves the order generation to order fulfillment. Order generation involves the transformation of the order forecast into a committed order. Either buyer or seller handle the order generation depending upon the competencies, system and resources to fulfill the particular order. In order to value proposition organization has to evaluate their performance. Firms proceed for the analysis to replenish the product on timely basis; performance has been assessed with certain criteria to establish the value addition to the customer. Challenges involved with CPFR: Firms has to access the different challenge while implementation of CPFR. Following are the different challenges faced with CPFR. Since CPFR main responsibility to integrate all the partners for that a big chances of bullwhip effect while passing information to the supplier once at a time. Organizations have the different goals and objectives so it’s difficult to bring all the vendors into one platform with same goal and objective. Exchange of complete data is another biggest challenge because some organizations will not provide complete information as policy matters. A core competency is another challenge since western countries are much develops than eastern countries so it’s important to be upgraded by the time. Preparing detailed plans for operations, inventory control and logistics will be a challenge. Conclusion: CPFR is the basic principle for the relationship between buyers and sellers and it is used to avoid bullwhip effect in order to give optimum level of customer satisfaction. It would recommend that both the parties have to be one platform to integrate the CPFR model effectively. Therefore, Firms capabilities based on strategic partners that would understand the problems and resolve it with mutual basis.