Among the myths taken as fact by the environmental managers of most corporations is the belief that environmental regulations affect all competitors in a given industry uniformly. In reality, regulatory costs—and therefore compliance—fall unevenly, economically disadvantaging some companies and benefiting others. For example, a plant situated near a number of larger noncompliant competi tors is less likely to attract the attention of local regulators than is an isolated plant, and less attention means lower costs. Additionally, large plants can spread compliance costs such as waste treatment across a larger revenue base; on the other hand, some smaller plants may not even be subject to certain provisions such as permit or reporting requirements by virtue of their size. Finally, older production technologies often continue to generate toxic wastes that were not regulated when the technology was first adopted. New regulations have imposed extensive compliance costs on companies still using older industrial coal-fired burners that generate high sulfur dioxide and nitrogen oxide outputs, for example, whereas new facilities generally avoid processes that would create such waste products. By realizing that they have discretion and that not all industries are affected equally by environmental regulation, environmental managers can help their companies to achieve a competitive edge by anticipating regulatory pressure and exploring all possibilities for addressing how changing regulations will affect their companies specifically.

    In recent years, Western business managers have been heeding the exhortations of business journalists and academics to move their companies toward long-term, collaborative "strategic partnerships" with their external business partners (e.g., suppliers). The experts' advice comes as a natural reaction to numerous studies conducted during the past decade that compared Japanese production and supply practices with those of the rest of the world. The link between the success of a certain well-known Japanese automaker and its effective management of its suppliers, for example, has led to an unquestioning belief within Western management circles in the value of strategic partnerships. Indeed, in the automobile sector all three United States manufacturers and most of their European competitors have launched programs to reduce their total number of suppliers and move toward having strategic partnerships with a few.

    However, new research concerning supplier relationships in various industries demonstrates that the widespread assumption of Western managers and business consultants that Japanese firms manage their suppliers primarily through strategic partnerships is unjustified. Not only do Japanese firms appear to conduct a far smaller proportion of their business through strategic partnerships than is commonly believed, but they also make extensive use of "market-exchange" relationships, in which either party can turn to the marketplace and shift to different business partners at will, a practice usually associated with Western manufacturers.