Let's see. It was Lopez at GM; then it was group purchasing organizations — co-ops; then it was online ordering (aka EDI); then it was integrated supply; then it was the Internet; then it was online bidding; now, it's supply chain management. You almost need a program to keep up with all the ways in which customers listen to consultants in their attempts to come up with new ways to hammer suppliers.

Consultants are impressive with their spreadsheets, graphics and promises of 30 percent savings because of fat in the value chain. And management is always interested in a new twist on an old problem: How do we control costs and swell the bottom line? Who could blame purchasing, since supply chain management boosts the purchasing department's power base in the organization?

For another perspective, ask the people who use, operate, maintain, or re-sell "supply-chained" products. Sixty-five percent of the added value that companies deliver happens during usage; 76 percent of value comes from knowledge-based activities. This is where customers begin to feel the pinch.

One problem with supply chain management is that it too narrowly defines a supplier's impact on a customer. It's a philosophy of efficiency and contraction. It conjures up an image of the clip-board-equipped efficiency expert wearing a lab coat, holding a stopwatch, spying through horn-rimmed glasses and sporting a flat-top hair cut.

Saving dollars and decreasing waste is a viable way to improve the bottom line, but it's not the only way. When buyers focus only on contraction — a cheap acquisition price and value-stripped solutions — they deserve all the misery that price shoppers attract, including vendors who eventually tire of the nickel-and-dime battles. GM's Lopez was more hated inside his organization than outside because his controversial philosophy toward suppliers destroyed decades of goodwill relationships.

The value-added philosophy, which has a customer-centric focus, is superior because it includes both dynamics: expansion and contraction. Value-added organizations seek ways to add value, not cost. They also seek ways to help customers compete more effectively, not just efficiently. To paraphrase Peter Drucker, there is nothing so useless as buying efficiently that which you should not buy to begin with.

In a broader sense, the value-added philosophy applies to most things in life: Do more of that which adds value and less of that which adds little or no value to your life. Supply chain management is a logistics solution to a broader problem. It's not the only solution — just one part of a more comprehensive philosophy of competing based on your total solution, not just your logistical and cost advantages.

The real question is not how much money the seller makes on a sale, it's how great an impact the seller's solution has on the buyer's organization. Unless you work for a non-profit organization, your company thrives on its profitable and viable customer relationships.