In Henry Ford’s day, consumers knew exactly where their cars came from. Ford made everything under one roof, processing steel and splitting lumber for wheel spokes at the massive River Rouge plant in Dearborn, Michigan. But that level of manufacturing purity hasn’t been the case for a long time.
For industries such as airlines and hotels, finding the best pricing model is the difference between survival and certain death. If an airline charges more than the market will bear and flies a row of empty seats from Dulles to Los Angeles, it can never regain that lost revenue.
A new paradigm that is changing the nature of business competition calls to mind two kids prepping for a street fight, gathering friends, older siblings, and allies. Suddenly, “me against you” becomes “me and all my friends against you and all your friends.”
A global supply chain—which begins with raw materials and progresses through manufacturing, packaging, transportation and distribution, and returns management—is a bit like a spiderweb. Both delicate and complex, the network is so interdependent that if you touch one place, reverberations emanate.