IT Infrastructure will lead to information availability that provides customer taste to supplier that leads to supplier’s responsiveness and efficiency because supplier forecasts customer demand and only supplies required product (Sunil Chopra and Meindl, 2007). A case in point is on Swedish post office that started a programme with customer involvement to develop new transportation services since it was losing customers and wanted to know their needs and wants of customers to satisfy them. Managers decided to conduct direct meetings with customers to provide services in accordance to their demands. This process was done through exchanging information with customers. After knowing customer demand the company started its transportation services of using one vehicle instead of five and pollution problem also reduced that resulting in increased efficiency (Lundkvist and Yakhlef, 2004).
Improved cost efficiency of a firm can be achieved through direct information sharing between firm and customer. Continuous conversation with customers plays a vital role in strategy development that resulting in creation a planning team for company. A company can identify its customers for strategic planning input through:-
• Use 80/20 rule – the company must in conversation with specific top 20% customers that generate 80% of company income.
• Choose companies in different conversation channels.
• Choose that company that considers company’s products for different applications.
• Continue with companies that want to continue with.
The conversation in above four ways can be done through following Marketing department, Customer service manager, Sales team and CEO’s conversation
On the long run, if cost of information continues to drop will result in cost rise for other supply chain drivers. Effective use of information can results in increase in coordination internally and externally with all supply chain partners and will result in company gaining more market share and profitability. The table below summarises is a guide to supply chain drivers toward responsiveness or efficiency.
Efficient Versus Responsive
Efficiency is best when producing relatively simple commodity products and services that sell in more predictable and in stable markets. The push for efficiency will increase productivity and lower product market prices especially on automobiles and home appliances which will make them readily available to a wide range market segment. Efficiency requires predictability and stability.
Responsiveness on the other hand drives continuous innovation to products. There will be continuous change businesses functions and customers services provisions. This comes as a requirement from customers who demand and go for products and services that respond quickly while satisfying their needs and desires. A case in point is on Apple and Starbucks who don’t sell lowest priced phones, laptops or cups of coffee, but people value and pay for the quality and experience offered by those products. Responsiveness to a company is best when producing more complex and unique products and services that sell in continuously changing markets shaped by evolving technology and new customer needs and desires.