Globalisation of the economy has accelerated the pace of mergers, acqu1s1t1ons, collaborations and other forms of partnerships. This has thrown up new challenges in supply chain collaborations. While many consider collaboration to be a win-win proposition because of demand aggregation strategies, dynamics of supply chains make it extremely uncertain as to the marginal gain for each of the supply chain stakeholder. In this paper, we model two simple, two stage supply chains and simulate collaboration among them in three different modes to understand the dynamics. From the results, we conclude that there is generally an overall benefit of collaboration but these benefits are not uniform, across the board among the supply chain partners. We therefore advise caution in merging supply chains without detailed study of cost benefit analysis for each partner.
Supply Chain Management, Collaboration, Simulation Models, Information Sharing
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