The above fig.3. shows the graphical representation of the performance of the CPFR & VMI and their effect on CSL, TSC under various conditions and levels of independent factors like CAP, DV and L. From the graphs one can notice the CPFR and VMI are better performing with high capacity of plant.
The data points represent increasing trend for both CPFR and VSM with respect to the increase in the capacity of the plant. The Performances are low at low capacity CAP 1.10 and increased when CAP value is 1.
50. Now when we consider CAP Level of 1.10 the total supply chain cost reduction of CPFR is 19.
2% and VMI is 14.6%. At CAP level of 1.50 CPFR supply chain costs by 42.
3% and VMI reduces TSC by 21.0%. Hence, we conclude that the supply collaborations will increase with increase in the manufacturing capacities of the plant.From the graphs it can also be observed that the total cost reductions from the CPFR & VMI is 22% combined at CAP level of 1.50, whereas at CAP level of 1.10 TSC reductions is 4%. Now it is evident that CPFR is more beneficial than VMI program for the provided larger capacity level.
But when there are constraints on the capacity level i.e. in tight conditions an appropriate collaborative model of both CPFR & VMI should be considered carefully. This explains that under tight conditions CPFR may not be able produce the expected cost reductions and required CSL.
4.2 Impact of Demand Uncertainty on Supply Chain Collaboration:MANOVA results in Table 2 show that at 5% significance level, there is an interaction effect between DV and SCTYPE, which has significant impacts on both demand variables. So it implies that uncertainty in market demand has a significant influence on CPFR and VMI for all performance measures. The study reveals that higher levels of demand uncertainty results in substantial decreases in the cost savings derived from VMI.Consider, the reduction in total supply chain cost from 24% to 15% when the uncertainty in the customer demand (DV) changes from low level (LDV) to high level (HDV). On the other hand, same level of increase in the demand uncertainty does not produce that much performance reduction in CPFR. For example, say it results in approximately 3% of reduction in total supply chain cost. In addition to this, the study also shows that the supply chain operated under CPFR produces higher customer service level under all levels of the demand uncertainty.