One of the hidden challenges in most transformations of a supply chain to a demand chain, is the alignment of the incentives through the chain.

For a demand chain to be successful, each point in the chain must see its own best interests best served by serving the best interests of the entire chain.

In a normal supply chain, each point sets out to maximise its own position, with little regard to those “upstream or downstream” of them, leading to gaming, which almost always produces sub-optimal outcomes.

Aligning incentives provides the opportunity to maximise the productivity of the resources tied up in the chain for all concerned.