MIT Sloan Management Review

The increase in outsourcing and offshoring of complex work has resulted in innovation efforts that require coordination across cultural, geographic and legal boundaries. If that coordination is mishandled, companies can find themselves needing to make multimillion- or even billion-dollar changes. The complexity of the task makes midcourse corrections likely. Managers must anticipate and adapt their processes in order to reduce risk and, ultimately, cost.

During the e-boom of the 1990s, academics, consultants, executives and investors alike claimed that e-procurement, and its increasingly central role in supply-chain management, would revolutionize how future business-to-business practices would take place: Efficiencies would be improved and procurement costs reduced; the flow of information along the supply chain enhanced; strategic

Distorted information from one end of a supply chain to the other can lead to tremendous inefficiencies: excessive inventory investment, poor customer service, lost revenues, misguided capacity plans, ineffective transportation, and missed production schedules. How do exaggerated order swings occur? What can companies do to mitigate them?

The persistent U.S. trade imbalance may have two causes: a declining manufacturing base and the shift of the U.S. economy toward services. Correcting the imbalance will require a substantial commitment to expand America’s manufacturing base.

JAPAN’S DISTRIBUTION SYSTEMS, LONG THE TARGET OF CRITICISM, ARE CHANGING. DEREGULATION, NEW MANUFACTURING IMPERATIVES, consumer behavior, and the economy have interacted to reshape Japanese distribution. The trends have important implications for global business, since the system now offers areas of opportunity for Western manufacturers and retailers.