Abstract: Information and incentive are the bottlenecks of the supply chain management . The first task of supply chain management is to design a mechanismto fulfill supply chain systemoptimization under asymmetric information conditions . This paper analyzes the asymmetric information and principle-agent relation betweenthe members of supply chains , and expatiates the importance of coordinationin a supply chain , and points out the mechanismdesigning theoryto overcome the inefficiencies insupply chains .