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...Texas Instruments has recently implemented an extensive planning and supply/demand matching optimization tool using the Internet. Every two days they do a global supply/demand match for over 45,000 products produced in 56 factories worldwide. 70% of their customer orders are now online; they provide real-time order status information. Their system has factory-level planning optimization with global inventory visibility.

The results of this improvement are a two-week reduction in customer delivery times and an increase in factory utilization of 2%. A two-week reduction in customer delivery times is clearly beneficial from a competitive standpoint. Also, while the increase in factory utilization may sound small, the impact of such a change on profitability is much larger than 2% since one is earning additional revenue without any increase in corresponding production capacity costs. (This is a fair assumption because Texas Instruments' factories typically build to order, which means they are likely to sell what they produce.)

Placing their benefits in our framework:

We have not yet provided any examples of multiple-chain benefits. To offer one example, a Contract Manufacturer or EMS (Electronic Manufacturing Services provider) may need to purchase a standard component for multiple OEMs (Original Equipment Manufacturers - customers of the EMS)...