From airplane parts to hedge funds to internet telephony, products and services are commoditizing. Focusing solely on what you make or sell is no longer adequate to secure long-term advantage. In this age, profitability can sink to marginality almost over night.

Forward-looking firms now work to improve their value chain as a whole. The emerging key to success is forming and sustaining strategic relationships with other companies up and down the entire chain: large customers, distribution channel members, tier-one suppliers, tier-two suppliers, logistics firms, customers' customers.

Personal engagement is increasingly replacing delegation. When well handled and conducted regularly, strategic relationship conversations with value chain partners are what companies need most to successfully target what customers value, to integrate their chains, and renew their competitive advantage.