Question

Collaborative Planning, Forecasting, and Replenishment (CPFR) is a web-based tool used to coordinate demand forecasting, production and purchase planning, and inventory replenishment between supply chain trading partners. In practice CPFR often doesn't deliver on its' promise because;

1) Computer systems at supplier companies cannot be made to work with each other.
2) Forecast errors accumulate as data exchanges are made down the supply chain culminating in the “feast or famine” phenomena known as the “bullwhip effect.”
3) Firms in a supply chain may not trust each other sufficiently to share information openly.
4) conflicting objectives between the profit-maximizing vendor and the cost-minimizing customer give rise to adversarial supply chain relationships.

Answer 1

3) Firms in a supply chain may not trust each other sufficiently to share information openly.

4) conflicting objectives between the profit-maximizing vendor and the cost-minimizing customer give rise to adversarial supply chain relationships.

There are various reasons based on which the CPFR may not be able.to deliver on its promise accordingly and as the organizations involved in a supply chain may have trust issues, they may not be able to share information mutually and openly. Again, as the objectives of the vendor and customer are contradictinh, this may actually give rise to conflicts in the supply chain having a negative impact overall.