ABSTRACT
In the airline industry, individual carriers can derive enormous benefits by transforming their relationships with their strategic suppliers into partnerships. Transformation of relationships with strategic suppliers into partnerships also requires dramatic changes in behavior on both sides. The experience of IBM provides excellent insights into how strategic outsourcing helped it to transform itself into a competitive powerhouse by redefining its core businesses, laying off or transferring thousands of employees from its payroll, developing new skills and behaviors, and restructuring its supply chain. Any risk can be minimized by the careful selection of and partnership with any supplier. The supply chain management professional at the airline can focus on analyses, negotiation, and relationship building with key suppliers, making them into partners. Core competencies would be a set of skills, behaviors, knowledge or activities which when combined create, maintain, and enhance an airline's competitive advantage.
