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...Our total supply chain may be drastically inferior to that of a competing supply chain, but we may be unable to observe that if we only compared our local node in the chain (e.g. our factory) with that of our competitor. Let's re-visit our inventory/service tradeoff curve in the figure below; the left side of the figure shows that our inventory/service tradeoff curve is very similar to our competitor's. The right side of the figure, measuring our entire supply chains, reveals that our competitor's overall chain achieves better response time with lower inventories. Given that we know that our company/node is performing well, what is then implied about the performance of our partners in our supply chain? What actions might that suggest?

For example, consider two motherboard manufacturers that each sell to a different PC maker. Both board manufacturers might have excellent, even similar, inventory/service levels, but if one of the PC makers is consistently late shipping product, customer satisfaction will drop - as will demand for their suppliers' motherboards. The motherboard manufacturer has a vested interest in understanding the weak points in the overall supply chain, and may consider either working with the PC manufacturer to solve the delays or selling to a different PC manufacturer. This is often described as "competition across supply chains" rather than individual companies. As we'll see on the next two pages, Internet technologies are providing for real-time collaboration in forecasting, sales information, and product design to make this a reality...