Question

You are a supply chain manager for Lumber Liquidators. You are trying to implement CPFR with many of your suppliers – what challenges do you need to overcome?

Answer 1

Answer:

Challenges to implement CPFR: The key challenges are the difficulty of making internal changes, total implementation cost, and trust.

As is true with any major implementation, internal resistance to change must be addressed by top management. Change is always difficult; however, if top management is committed to the project, then the project is much more likely to succeed. Companies will need to educate their employees on the benefits of the process changes and the disadvantages of maintaining the status quo. Although cost is an important factor, companies with no plans for adopting CPFR should determine whether they are at a competitive disadvantage, as more and more companies implement CPFR. Trust, a major cultural issue, is considered a big hurdle to widespread implementation of CPFR because many retailers are reluctant to share the type of proprietary information required by CPFR.

Lack of trust is often associated with unreliable data and the lack of integration internal to suppliers and manufacturers. The real challenge to widespread adoption of CPFR is that it requires a fundamental change in the way buyers and sellers work together.