Somewhere in the vast global marketplace a new product hits the market every 3.5 minutes, and a major corporate acquisition takes place every 20 minutes.

The Internet has lowered costs and improved response times for the supply chain management of traditional business. To stay competitive, companies have transformed their supply chains from cost-based, back-office functions to flexible, interconnected systems that:

• reduce inventory and associated costs
• enable better real-time forecasting decisions
• speed the delivery of products and services
• streamline payment and billing cycles
• increase revenues
• improve services
• enhance the buying experiences and interactions for customers.

In the global marketplace, smaller, higher cost players must act quickly and cleverly to avoid losing out to copycats in the ‘time to market’ race.

Large, smart companies usually counter this by moving up the value chain; they use tight and flexible integration with partners, suppliers and customers. They also invest heavily in networked, intelligent systems that operate seamlessly across all parts of a business alliance. For example, the Internet eases the purchase of raw materials and components, allowing buyers to combine long-term contracts with spot markets to reduce safety stocks and associated holding costs.

Many small businesses use the agility, speed and close collaboration of the Internet to outrun competitors and quickly fill lucrative new niches.

The future of supply chain management requires that, as each new innovation arrives, the risks and costs for each player must be carefully weighed against the benefits to the chain as a whole.