Reduce Fulfillment Time Increase Flexibility Organize for Mass Customization Collaborate with Engineering Collaborate with Suppliers in Fulfillment Outsource for the Right Reasons Improve Quality and Reliability Eliminate Production Losses

• Focus on their core competencies and outsource the rest
• Purchase completed assemblies, tested and ready to go on the lines
• Allow suppliers in fulfillment to design, build, and test assemblies
• Provide suppliers in fulfillment drawings and other information quickly

• Make some components - vertical integration
• Buy components, then test and assemble in-house
• Have lower plant utilization
• Have high plant investment and low flexibility
• Become locked into obsolete equipment and techniques

• Lets suppliers in fulfillment do what they do best
• Keeps only core competencies in-house
• Grows quickly, sharing the risk with suppliers in fulfillment
• Responds quickly to changing market demands
• Lowers cost and higher profits
• Lowers capital investment, and frees resources
• Promotes innovation
• Uses suppliers' superior technology and product knowledge

"If corporations don't do something particularly well, they outsource it to partners. In a business web, they stick to what they do best, and everyone benefits." - Business Week, July 17, 2000, review of Digital Capital by Don Tapscott, David Ticoll, and Alex Lowy