Cooperative business management strategies for the U.S. integrated textile complex Page: 5 of 6
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The best way to illustrate the cooperative data analysis concept and the supporting SCIP tool is through
a simple example. Consider the simple hypothetical manufacturing supply chain shown in Figure 2,
where the arrows depict the direction of product flow.
Company A Company B Retailer E
" Item 1 " Style 1
" Item 2 Company C " Style 2
" Item 3 C Style 3
Figure 2. Example Supply Chain Illustrating the SCIP Concept
Suppose that Company A is at full capacity and producing items 1 and 2 for Company B and C,
respectively. Now suppose Company A receives an order for item 3 from another strategic business
partner, Company D. Unfortunately it cannot fill this order without making some production schedule
change. All three orders are important to Retailer E so a resolution of this problem is desired. A supply
chain level analysis enabled by SCIP is performed to see what change can be made that will be
beneficial to all five companies. Let's assume that Company A has TPAs with companies B, C, and D
that provides them with access to finished goods inventory data via TEXNET. Let's also assume that
Company A has a TPA with Retailer E to obtain data regarding promotion plans and sales forecasts.
Using the SCIP tool, Company A determines that the current production of items 1 and 2 can be delayed
without negatively impacting Companies B, C, and E's ability to meet demand. TEXNET handles the
secure data transfer, and SCIP handles the propagation of relevant constraints through the supply chain
including the complexities associated with bill of material conversions, desired safety stocks, apparel
production capacities, shipment times, and other relevant supply chain constraints. Companies B and C
may still desire their orders as originally planned for local business reasons, but the SCIP analysis shows
that this is a non-optimal solution for all parties taken as a whole. They can reach this conclusion by
viewing the results of Company A's SCIP analysis or by using SCIP to analyze the supply chain from
their point of view. As a result of the SCIP analyses, Company A can now meet the order of item 3 from
Company D by adjusting the production schedule. This example clearly illustrates both the technical and
social aspects of the CBM concept.
Exploring Alternative Sourcing Options
The third CBM strategy involves exploring alternative sourcing options. The SCIP-enabled solution to
the sample problem presented above is only one of many possible solutions. Another approach would
have been for Company D to explore alternative sources for its order. The National Sourcing Database
(NSDB) addresses this need by providing a computer tool that can be used to quickly identify new or
alternative sourcing options. Any company with access to the Internet and the World Wide Web can use
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Washington, K.E. Cooperative business management strategies for the U.S. integrated textile complex, article, December 31, 1995; Albuquerque, New Mexico. (digital.library.unt.edu/ark:/67531/metadc665583/m1/5/: accessed November 18, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.