Discuss the advantages of having point-to-point contact (Exhibit 1 below) betwee

Question

Discuss the advantages of having point-to-point contact (Exhibit 1 below) between functional groups at different companies. Are there any disadvantages to this approach?

EXHIBIT 1

Supply Chain Linkages Between Whirlpool Corporation and Inland Steel

Supplier                                                                                        Buyer

Manufacturing                 <——————————>                 Manufacturing

Human resources           <——————————>                 Human resources

Accounting                     <——————————>                 Accounting

Engineering                     <——————————>                 Engineering

Sales/Marketing              <——————————>                 Purchasing

Explanation / Answer

The biggest advantage of point to point contact is that the information sharing is easy as people work more closely together thus the supply chain is more effective. Engineers can discuss issues without having any other non technical person in between them where the information mayget distorted.
The harmful effect of point to point contact is every dept works in isolation and does not take into consideration the 360 degree view of the business. A good decision of supplier might have detrimental effect on the accounting dept.

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