A few days ago, weather forecasters here in New England issued a winter storm warning—we were going to get hit and hit hard. But wait. Only hours later, we were told to expect a little rain and sleet instead.
If forecasting tomorrow's weather is that hard, then think of the challenge of trying to determine what you're going to sell—and have to ship—over the next week, quarter or year. For the past six years, the collaborative planning, forecasting and replenishment (CPFR) committee of the Voluntary Interindustry Commerce Standards Association has labored to develop tools to make that task easier. The goal is to help trading partners align information on which they make decisions.
What the committee, whose members are major retailers, manufacturers and service providers, came up with was a set of processes—a nine-step model— that trading partners interested in CPFR can follow. Even so, the adoption of collaborative processes has proceeded more slowly than many had hoped.
Part of the problem is that the nine-step process model developed by the VICS committee can seem intimidating. But what many who have started the process have learned is that the model is not a prescription, and success does not depend on completing each and every one of the steps. As Joe Andraski, managing director of VICS and vice chairman of the CPFR committee for most of the last six years, says, "One of the clear myths is that this is a very rigid nine-step process.We've been telling the business community it is not nine steps, and it is not inflexible. We find companies using nine steps and as few as two steps."
The committee continues to fine-tune the model. Earlier this year, it began looking at a new CPFR model that implies a less rigid process for implementation than the current model does. The committee may adopt the new model when it meets later this month in Atlanta. In the meantime, the committee has created new subcommittees to look more closely at individual parts of the process.
Certainly, CPFR initiatives are not easy to pull off. But as Andraski points out, companies that have been successful with CPFR are also gaining market share. That makes it worth another look—perhaps not with the goal of implementing all of the steps with all suppliers, but with the more realistic aim of seamlessly linking up with a select few.