2.2. The integration model
This paper considers internal and external integration. Internal integration refers to the
coordination, collaboration and integration of Logistics with other functional areas
(Stock, Greis & Kasarda, 1998). This paper considers internal integration in two
different interfaces: Logistics-Marketing and Logistics-Production. We consider these
interfaces for two reasons: first, the coordination between these areas is vital to
produce and serve what customers demand, how and when they want. And, second,
Logistics is an organizational function which shares responsibilities with Marketing and
Production (Casanovas & Cuatrecasas, 2001). The combination of the integration
levels achieved in these two interfaces are shown in figure 1. At one extreme is a
strategy of little or no integration (Option 1). At the other end of the continuum is a
strategy with high levels of integration in both internal interfaces: Logistics-Marketing
and Logistics-Production (Option 4). And, in between these polar extremes are
companies whose strategies involve integration in the Logistics-Marketing interface
(Option 3) or the Logistics-Production interface (Option 2).