Information systems have developed along the supply chain to support logistics management in all types of industries. Most of this effort has been focused at reducing the levels of working capital by increasing the efficiency of information flow from market to raw materials suppliers. Similar developments have also occurred to support other business processes, for example connecting together new product design and marketing databases to create virtual corporations. Electronic commerce and associated technologies such as EDI are the norm in advanced supply chains and it is common for their use to be mandatory when trading with large companies. The manufacturing of a product is now seen as a whole process across the supply chain rather than a series of separate operations managed and controlled by different organisations. The management of logistics has been fundamentally re-engineered and designed to focus on quality and time-based strategies. However developments in the handling of financial information between functions within companies and across organisational boundaries have lagged far behind the developments in logistics management. This paper explores the potential benefits of co-operative relationships in the financial supply chain to reduce the time delays and increase the level of certainty regarding financial transactions between separate organisations. An example is used to illustrate the financial benefits of moving from an adversarial to a co-operative relationship and the potential savings are shown to be significant. An organizational model is presented of likely future developments and steps that can be taken by the financial service industry to benefit as integrated providers of financial services to supply chains and the areas for initial implementation are outlined
