It has never been simple to manage the information that flows through a product supply chain. Companies must work closely with suppliers, logistics providers, distributors, and retailers to collect and manage information about customer demand, sales orders, distribution schedules, production planning, manufacturing, sourcing, and product design.

But this task has become even more complex because outsourcing has stretched supply chains around the globe (Exhibit 1). Companies not only buy more of their raw materials, components, design services, and manufacturing from far-flung third parties but also rely on contractors to coordinate the manufacture and movement of their goods.

Both trends reduce costs, but in exchange, executives have given up something valuable: easy access to critical data—such as details about quality, supplies on hand, and manufacturing capacity—that could help raise productivity. For example, a computer hardware company's supply planner, trying to meet a spike in demand for certain products, needs capacity and inventory information from several components suppliers and several contract manufacturers, but the data may be locked up in the IT systems or spreadsheets of a dozen or more companies. Likewise, a manufacturer seeking to reduce warranty...