With as little effort as a few clicks, you can make a purchase in less than a minute. This elimination of the middlemen, who do not add value to the consumer, is referred to as disintermediation. In addition to the consumer, it has profound effects on the supply chain. For example, the online book buyer has eliminated the need for shipping the book from the book supplier to the bookstore, reducing the cost of providing the product in terms of both time and money. We can see these same effects in other areas such as the optimization of logistics through digital supply chains and in online bill presentment and payment .
Consumers now have more information.
They can compare more prices in less time, thus compressing their buying cycle. This price transparency is driving prices down. Providers of goods and services will be judged on how well they add value to the end consumer. These models give us insights into how enterprises can add the most value to their end consumers. The optimization of cycle time is fundamentally about reducing complexity.