Trusted Partners: How Companies Build Mutual Trust and Win Together

Jordan D. Lewis

The Free Press, 2000

ISBN 0-684-83651-3

336 pages, $30

To order: Call (212) 632-4986 or visit www.SimonSays.com

Pick up any business magazine or attend any industry conference on supply chain management and you'll notice one recurring theme: Partnerships and alliances are essential to supply chain success. That advice, typically given freely by a management guru, sounds logical enough and easy to implement. But actually going out into the real business world and forging that partnership is another matter altogether.

Trusted Partners can help in that real-world exercise. Written by Jordan Lewis, author of The Connected Corporation, this book offers insight and practical wisdom into business partnerships. More specifically, it shows how companies can build trust—that elusive element so absolutely essential to any kind of successful alliance.

The books unfolds in three parts: (1) an explanation of the central role that trust plays in partnerships, (2) a how-to section on building trust with supply chain partners, and (3) a series of tools that practitioners can apply in building alliances.

One of the most welcome aspects of this book is the author's abundant use of real-life examples to reinforce the key points. In the exposition of the role of trust in alliances, Lewis relates the experiences of a wide range of organizations—Kodak and IBM, Sea-Land and Maersk, and Wal-Mart and Procter & Gamble among them. The successes are highlighted as well as the often-painful lessons learned from ill-conceived or poorly executed partnering initiatives.

Anecdotes and case examples are similarly prominent in the how-to discussions. For example, in the chapter "How to Sell Alliances to Customers," the author details how ABB's Paint Finishing division successfully forged an alliance with Ford. The key to success in this relationship (as with all relationships, the book maintains) is mutual adherence to the eight conditions for trust. These are mutual need, strong interpersonal relationships, joint leaders, shared objectives, safeguards in place, mutual commitment, adaptability, and continuity.

The checklists, charts, and bullet points appearing at the end of the text (a section aptly called "Tools for Trust: A Guide for Practitioners") may be the most instructive part of the book. Managers can use the tools presented here to help chart their course of action as they seek to build trusting relationships across their supply chain.

True partnerships are not easily developed, as anyone who has attempted to form them will readily attest. But as Jordan Lewis says in the preface to Trusted Partners, the effort will pay meaningful dividends: "With trust as a foundation, companies—or groups within companies—can share their know-how to achieve results that exceed the sum of the parts."

Wharton's Forum on Electronic Commerce

The Wharton School

University of Pennsylvania

Ecom.wharton.upenn.edu

The atmosphere of frenzy, anxiety, and exaggeration surrounding e-commerce creates a real risk that hearsay will become conventional wisdom quicker than the click of a mouse. The Web site for the Wharton Forum on Electronic Commerce, however, does an admirable job of cutting through the hype and separating fact from fiction.

Organized by the University of Pennsylvania's Wharton School of Business, the Forum on E-Commerce brings together academics and practitioners to identify and explore critical e-business topics. So, instead of spouting the latest urban legend about the Web, the E-Commerce Forum posts well-researched findings.

To cite one example, visitors to the site will find a summary of a recent joint study by Wharton and the Columbia Business School on comparison shopping habits on the Internet. The study, which is based on analysis of 10,000 households per month for a year, reveals the surprising fact that book buyers searched just 1.1 sites per month and buyers of travel services searched only 1.8 different sites during that same time frame. These results dispel the notion that the Internet turns consumers into super-savvy comparison shoppers, quick to defect to competitors that are only a mouse click away.

As this survey indicates, the forum is particularly interested in the Internet's effect on consumer behavior. The forum is working with the Wharton Virtual Test Market, which studies Web consumer demographics and attitudes and predicts online purchase behavior. Other areas of inquiry include Web-based competition, Internet pricing strategies, emerging models for Web-based enterprises, and business-to-business e-commerce.

Some of the information on the site is restricted to forum members only. However, a considerable amount of valuable data and information is made available to the general user—including the abstract of the report "On the Depth and Dynamics of World Wide Web Shopping Behavior." Users also can link to other helpful sites and access an up-to-date suggested reading list. Unfortunately, the site does not clearly indicate which reports are available to the general public and which require a password. Users have to figure that out for themselves by clicking on the actual report.

Companies interested in full membership benefits will have to pay dues of $50,000 per organization per year. But even for those without a membership, this site provides a good aid for keeping a cool head in the Internet age.

Digital Capital: Harnessing the Power of Business Webs

Don Tapscott, David Ticoll, Alex Lowy

Harvard Business School Press, 2000

274 pages, $27.50

To order: Call (888) 500-1016 or visit www.hbsp.harvard.edu

We're already well into a new digital era where the old rules of engagement no longer apply, write the authors of this new book from the Harvard Business School Press. And those organizations that don't understand this reality—or don't want to understand it—are dooming themselves to extinction.

The key to survival is to effectively harvest what the book calls your digital capital. This concept is defined as the internetworking of three types of knowledge assets: human capital (what people know); customer capital (who you know, and who knows and values you); and structural capital (how what you know is built into your business systems). You form and build reserves of this capital through business webs. In the words of the authors, a business web is "a distinct system of suppliers, distributors, commerce services providers, infrastructure providers, and customers that use the Internet for their primary business communications and transactions."

Today, five basic types of business webs exist, all of which readers will recognize upon reading the descriptions. These web types are the agora (from the Greek word meaning assembly place), aggregations, value chains, alliances, and distributive networks. Each of these webs is explained in detail with plenty of useful illustrations. The authors describe sell-side auctions like eBay and open markets like Monster.com, for instance, as examples of agoras.

The point of this discussion of business webs is to help readers understand the digital playing field so they can build a Web strategy that leverages their strengths. The authors present a framework for doing just that as they advise how to "weave" a business net. The process begins by determining the ultimate value proposition from the standpoint of the end-customer. Then you disaggregate your capabilities and those of your trading partners to see how they do (or do not) contribute to that proposition. From here, you reaggregate the capabilities and the players to deliver on that proposition and then devise a business Web strategy that fully supports it.

Digital Capital is a highly readable book that eventually may do as well as The Digital Economy, written by one of the co-authors, Don Tapscott. It succeeds much more as a thought-leadership piece than as a practical guide for devising and implementing any kind of Web strategy. So read and enjoy the book for what it is—a big picture view of how the digital economy is affecting everything and everybody in the business world.

No Boundaries: Moving Beyond Supply Chain Management

James A. Tompkins

Tompkins Press, 2000

288 pages, $24.95

ISBN 0-9658659-2-4

To order: Call (800) 789-1257 or visit www.tompkinsinc.com

In his new book, No Boundaries: Moving Beyond Supply Chain Management, industry consultant and author James Tompkins proclaims that supply chain management is not enough anymore. The reasons: It's largely a logistics-based concept that fails to take into account the manufacturing process. Furthermore, it espouses a view of the supply chain as links rather than an integrated whole.

In place of supply chain management, Tompkins advocates what he calls supply chain synthesis—a continuous process of integrating every component of the supply chain to maximize customer satisfaction.

According to the author, the two guiding principles of supply chain synthesis are integration and change. In the third chapter of the book (which was excerpted in the March/April 2000 issue of Supply Chain Management Review), Tompkins outlines the 12 pillars that support change and integration. These include such concepts as consolidation, reliability, flexibility, and modularity.

This overview of the key aspects of supply chain synthesis proves thought provoking. But the book would have been even stronger had it included more practical steps for achieving these goals—a framework or roadmap for progress, if you will. Knowing that consolidation and flexibility are key to continued success is one thing; knowing how to accomplish these goals is a much more complicated matter.

No one can fault No Boundaries for a lack of case examples and anecdotes. There are dozens of stories (some told before, others new) of companies that have applied the key supply chain synthesis principles successfully. These are made all the more effective by their treatment as sidebars in the text adjacent to the points they underscore.

In short, the book's strength lies not so much in its innovative thinking (readers will find themselves generally familiar with most of the concepts discussed). Instead—and fittingly for a book advocating synthesis—the strength lies in its ability to consolidate all these ideas together in one package. Readers can turn to No Boundaries as a resource that ties together a variety of different management techniques into one cohesive whole.

Supply Chain Council

www.supply-chain.org

Four years after its inception, the Supply-Chain Council continues to focus on providing standard process definitions, terminology, metrics, and best practices for supply chain management. For this reason alone, supply chain professionals should be familiar with the council and its Web site, www.supply-chain.org.

The site is divided into parts that are open to the general public and parts that are restricted to council members. Although the Web site's offerings to the general public are limited, noncouncil members can see an overview of the council's well-known Supply Chain Operations Reference (SCOR) model. This overview gives a summary of factors to be considered in mapping and refining supply chain processes. However, since the overview posted on the Web has not been updated since May 1999, it does not contain any of the additions and revisions made earlier in this year.

The general public portion of the site also provides information about supply chain management and the council itself as well as job postings and a list of helpful resources. Like the SCOR overview, some of this information could use updating. The publications list, for example, only includes books published up to 1998.

To receive the full benefit of the Web site, then, interested parties will have to apply for membership. Members can access the complete form of the council's SCOR model, which provides a map of standard supply chain management processes from order entry through paid invoice.

The application form can be accessed on the Web site. Practitioners, vendors, and consultants pay $1,750 for a voting membership; academics and consortium members can receive a nonvoting membership for $200.

Sometimes the council and its SCOR model are accused of being too abstract for practitioners in the supply chain trenches. But the broad, high-level approach taken is necessary for establishing a common vocabulary and syntax. And as connecting, communicating, and collaborating with one's supply chain partners becomes less pie-in-the-sky and more business necessity, the council's common definitions and standards will become more important to more people.