Supply chain collaboration

In supply chain management, supply chain collaboration is defined as two or more autonomous firms working jointly to plan and execute supply chain operations. It can deliver substantial benefits and advantages to its partners. It has been known as a cooperative strategy when one or more companies or business units work together to create mutual benefits. There are two main types of supply chain collaboration, vertical collaboration and horizontal collaboration. Vertical collaboration is the collaboration when two or more organizations from different levels or stages in supply chain share their responsibilities, resources, and performance information to serve relatively similar end customers; while horizontal collaboration is an inter-organizational relationship between two or more companies at the same level or stage in the supply chain in order to allow greater ease of work and cooperation towards achieving a common objective.Collaborative communication is the contact and message transmission process among supply chain partners in terms of frequency, direction, mode, and influence strategy. Open, frequent, balanced, two-way, multilevel communications indicate close inter-firm relationships.