Study Of Collaboration In Vendor Managed Inventory

The key to successful Supply Chain Management is collaboration among enterprises of a supply chain. Robust collaboration means not only profitable business, but also sharing of resources and common strategies. Vendor Managed Inventory is the very initiative that focuses on the firm collaboration between Supplier and Retailer. The paper began with a comprehensive introduction to VMI and its core ideal, and a detailed depiction of its business processes. And a model of shipment coordination for VMI was studied to quantitatively analyze the frequency of replenishment to retailers in a two-level supply chain. A set of hypothesis was proved that smaller quantity of minimum shipment unit increases supply chain agility and inventory stability while the supplier bears more cost of shipment, and vice versa. In the next section, Johari Window, a graphic model of awareness in interpersonal relations, was presented to analyze the collaboration in VMI. Through an Organizational Behavior approach, the conceptual model was improved and both technological and managing factors was considered to show that information sharing is not only concerned with technology, effective management and the cultural infrastructure of information growth spiral is critical to successful application of information technology. Finally, a case study of the pilot project between Procter and Gamble (P&G) and Welcome on the application of VMI was presented to visualize what was mentioned in this paper.