During the last twenty years, businesses migrated from vertical integration to a virtual model, outsourcing all their non-core functions. This has created challenges in aligning the strategies and activities of all these functions dispersed across the supply chain, each in separate legal entities. The next phase of evolution to emerge is the "dynamic federation", or federated supply chain which is governed differently than both vertical and virtual businesses.
different business models
normally unintegrated services from different banks, insurance companies, investment advice, electronic payment, and so forth into a single suite of integrated services. This takes a lot of work behind the scenes to integrate the billing systems, help desk systems, etc. In the old model, the effort would be made to build a new IT structure, integrate all the disparate components, host its own business site, etc. But the new models of federation address standards, so that rather than integrating and