Beyond the Organization: The Power of Supply Chain Collaboration

Trade conflicts, shortages of raw materials, and increasingly stringent sustainability regulations are forcing organizations to rethink their role within the supply chain. After many years in which companies primarily focused on efficiency and cost reduction, collaboration is now increasingly becoming a strategic prerequisite. In his emeritus speech on 8 May, Professor of Supply Chain Management Jack van der Veen therefore argues for a perspective that transcends individual organizations and focuses on the chain as a whole.

“Only through intensive collaboration between parties can organizations maintain their innovative strength and translate societal trends into their own business operations,” says Van der Veen. “That need for collaboration has a longer history. Since the 1990s, international trade has increased sharply and organizations have outsourced ever more activities. Supply chains became longer and more complex, and attention for Supply Chain Management grew accordingly.” Van der Veen was at the forefront of this development, among other things through the establishment of the Marketing & Supply Chain Management department at Nyenrode Business University.

Who Is in Control?

According to Van der Veen, there are broadly three ways in which supply chains can be organized. The first is that each party in the chain operates autonomously—an approach for which it is intuitively clear that it rarely works well. A second option is that one dominant player takes control of the entire chain, as Amazon does, for example. This approach closely aligns with the American model. In contrast, there is a third form: intensive collaboration between parties, with close mutual coordination. Van der Veen regards this as the European alternative.

Why Supply Chain Collaboration Often Breaks Down

Van der Veen’s fascination with supply chain collaboration led him to focus much of his career on Supply Chain Collaboration (SCC). In theory, supply chain collaboration proves highly effective, while in practice Van der Veen often received signals that it does not always work out that way. This tension between theory and reality formed an important research theme throughout his career. Over time, Van der Veen discovered that the explanation for this discrepancy lay in a very different area than he initially expected. “It is mainly human factors that can prevent collaboration in the supply chain from taking off properly,” he explains. “Think of differences in culture and leadership, or a lack of trust.”

The Strength of the Polder Model

In his emeritus address, Van der Veen zooms in on the collaboration paradigm and discusses twelve models that contribute to better supply chain collaboration. “The message I want to convey in my address is that there is a European alternative, and that there is nothing wrong with a polder model in which parties in the supply chain consult and coordinate with one another. On the contrary, parties actually need each other to effectively translate broader trends into their own business operations. Take corporate social responsibility, for example: a fashion brand can hardly claim to sell sustainable clothing if it is produced by children in a textile factory in Bangladesh.”

From Silos to Chain Strategy

In practice, however, supply chain collaboration turns out to be more complicated than expected. “We are not accustomed to working in this way, so companies are also faced with a transition challenge.” This different way of working begins first and foremost with strategy, and with an organization’s vision, mission, and long-term objectives. “For family-owned businesses, this long-term orientation is often self-evident, whereas publicly listed companies are typically driven more strongly by short-term profits and shareholder interests.” Secondly, supply chain collaboration requires thinking in terms of production processes: how does a product come into being, and what is needed for that? This means organizations no longer operate from isolated silos but instead adopt an overarching view of the entire chain.

Innovation Requires a Different Mindset

The third aspect that plays an important role in the transition challenge is people’s mindset and behavior. “Organizations should invest much more in a culture that allows room for experimentation and making mistakes,” says Van der Veen. “Only in this way can innovative ideas really take off. Take ASML, for example. The innovative power of this company is inextricably linked to that of its suppliers. Only when they are involved from the very beginning of development can new technologies actually be realized.”

The European Model as a Worthy Alternative

Van der Veen explains that the American model has long been dominant in the way we think about supply chain management, partly because management books on this topic have often originated in the United States. “Nevertheless, I believe that the European approach is a worthy alternative that deserves to be pursued. For executives, this means that success no longer lies solely in optimizing their own position within the chain, but in actively building relationships, trust, and shared strategies. There is often criticism of our polder model, but we actually underestimate its strength.”