The physical supply chain has undergone a radical transformation in the US, resulting in many efficiency gains. Technology is one of three factors that have played an important role in this process. The internet has ushered in an era of instant, easy exchange of information and messages anywhere, anytime. Lean manufacturing and just-in-time inventory, which depend on complex information technology, have tightly integrated buyer and supplier and removed the costly burden of excess inventory in the supply chain. Large corporations have established buyer-seller connectivity via EDI and, by reducing their supplier base to a small, select core of cost-effective suppliers, have created a competitive advantage for their supply chain.

Globalization, the second factor, has extended the supply chain across vast geographies. Today, small as well as large US companies are sourcing or selling product overseas, primarily with Asia and Europe. Offshoring has substantially reduced the cost of goods. Since mid-2000,...