Abstract
Supply chain collaboration is crucial to gain and sustain a competitive advantage in today’s competitive landscape. Competition does not take place between single companies anymore. Today, supply chains are competing against supply chains. This paper suggests enhancing the Total Cost of Ownership approach to a supply chain wide application. The approach can assist supply chain managers in (re-)designing the value chain with special attention to an optimization ofthe overall costs throughout the entire supply chain. The author applies an exploratory case study approach in order to assess the status quo of supply chain costing initiatives in a well-established supply chain. The case studies are based on a four-stage European supply chain of a German premium car manufacturer. The results indicate that even in a world class supply chain, the concepts of integration and supply chain wide cost optimization are not yet established. Furthermore, the results highlight the vast potential of supply chain costing initiatives. The glaring inefficiencies all over the supply chain demonstrate immediate need for SCM researchers to translate research findings into management behavior.
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Kern, D. (2011). Determining the Total Cost of Supply Chain: A TCO-Approach to Supply Chain Optimization. In: Essays on Purchasing and Supply Management. Essays on Supply Chain Management. Gabler Verlag. https://doi.org/10.1007/978-3-8349-6227-0_5
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