An interorganizational system, IOS, refers to the way partnered businesses manage their relationships between one another and their clients or customers. Businesses that sell similar items or services, or require the help of other businesses to complete the sale of a product are undeniably linked in the market. An IOS system ensures that communication between these businesses is efficient, creates healthy competition and improves the services delivered to clients and customers.
Supply chain management, SCM, refers to the network and communication between interconnected businesses that depend on one another to deliver a product or service to the public. An interorganizational system creates automated communication between interconnected businesses, or information that is programmed to update itself, with minimal manual operation from a worker.
Running an IOS requires the use of technology. Phones, computers, internet and intelligent computer programs and software are used to send and receive messages and store and interpret data. When one company implements and uses a new technology in an IOS system, partnering companies automatically benefit from this discovery. Technology is exchanged easily and encourages creators to develop new products and programs.
IOS systems perpetuate healthy competition in the market. Businesses who implement this system gain the power of numbers as they partner with others in an efficient manner. Businesses in an IOS have more efficient supply chain relationships, creating competition and encouraging other businesses to begin working together. The more competition available, the better the products and services offered and the fairer the prices to the public.
IOS makes communication available at a global level. A business implementing this system for the first time may start at a local level. Once the business understands its capacity for an IOS system, it can implement new technological tools, hire new employees and seek to incorporate businesses at a national and global level. The wider the network of communication, the more businesses have a chance to learn new tactics from one another and increase productivity.
Reduce Business Risks
Every business takes risks during the process of production. These risks include safety, financial and operational risks. An effective ISO system reduces these risks, making sure each aspect of the business is being watched. The system provides checks and balances that hold each aspect of the company accountable to one another and partnering companies.
- CIO; "Supply Chain Management Definition and Solutions"; Thomas Wailgum; November 2008
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