Over the last decade there have been significant changes to the traditional purchaser-supplier relationship within industrial organizations. This has involved reforming old-style purchasing relationships, which relied on several alternative suppliers competing mainly on price, to the preferred single-sourcing relationships, with accompanying mutuality of benefits to the partners involved. This change has been highlighted by the success of Japanese manufacturing firms. However, the process of change is a difficult task for any organization to achieve. It is even more difficult in public-sector organizations, where profit-maximizing aims have not been central to organizational behaviour, and where past practice has been the basis for current operational decisions. However, government policy of privatization and the development of public sector quasi-markets has resulted in a shift of emphasis and a consequent re-examination of operational practices in the light of market discipline. Public-sector organizations operate in markets constrained by political parameters, but privatization and the development of a commercial approach have led to many public-sector organizations' adopting the business style of private sector companies. This paper aims to recount some of the problems that British Rail (BR) experienced in this transition period and how it managed this change process, and to summarize some of the key considerations for developing and sustaining partnerships between purchaser and supplier.