Supply network
Encyclopedia
A supply network is a pattern of temporal
and spatial processes carried out at facility nodes and over distribution links, which adds value for customers through the manufacturing and delivery of products
. It comprises the general state of business affairs in which all kinds of material (work-in-process material as well as finished products) are transformed and moved between various value-added points to maximize the value added
for customers.
A supply chain
is a special instance of a supply network in which raw materials, intermediate
materials and finished goods are procured exclusively as products through a chain of processes that supply one another.
In the semiconductors industry, for example, work-in-process moves from fabrication to assembly, and then to the test house. The term "supply network" refers to the high-tech phenomenon of contract manufacturing where the brand owner does not touch the product. Instead, she coordinates with contract manufacturers and component suppliers who ship components to the brand owner. This business practice requires the brand owner to stay in touch with multiple parties or "network" at once.
As a resilient supply network should align its strategy and operations to adapt to risk that affects its capacities, the achievement of resilience should be reached from these two points of view.
Time
Time is a part of the measuring system used to sequence events, to compare the durations of events and the intervals between them, and to quantify rates of change such as the motions of objects....
and spatial processes carried out at facility nodes and over distribution links, which adds value for customers through the manufacturing and delivery of products
Product (business)
In general, the product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce, from the Latin prōdūce ' lead or bring forth'. Since 1575, the word "product" has referred to anything produced...
. It comprises the general state of business affairs in which all kinds of material (work-in-process material as well as finished products) are transformed and moved between various value-added points to maximize the value added
Value added
In economics, the difference between the sale price and the production cost of a product is the value added per unit. Summing value added per unit over all units sold is total value added. Total value added is equivalent to Revenue less Outside Purchases...
for customers.
A supply chain
Supply chain
A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to...
is a special instance of a supply network in which raw materials, intermediate
Intermediate good
Intermediate goods or producer goods are goods used as inputs in the production of other goods, such as partly finished goods. Also, they are goods used in production of final goods. A firm may make then use intermediate goods, or make then sell, or buy then use them...
materials and finished goods are procured exclusively as products through a chain of processes that supply one another.
In the semiconductors industry, for example, work-in-process moves from fabrication to assembly, and then to the test house. The term "supply network" refers to the high-tech phenomenon of contract manufacturing where the brand owner does not touch the product. Instead, she coordinates with contract manufacturers and component suppliers who ship components to the brand owner. This business practice requires the brand owner to stay in touch with multiple parties or "network" at once.
Resilient supply networks
A resilient supply network effectively aligns its strategy, operations, management systems, governance structure, and decision-support capabilities so that it can uncover and adjust to continually changing risks, endure disruptions to its primary earnings drivers, and create advantages over less adaptive competitors . Moreover, it has the capability to respond rapidly to unforeseen changes, even chaotic disruption. The resilience of a supply network is the ability to bounce back — and, in fact, to bounce forward with speed, determination and precision. In recent studies, resilience is regarded as the next phase in the evolution of traditional, place-centric enterprise structures to highly virtualized, customer-centric structures that enable people to work anytime, anywhere .As a resilient supply network should align its strategy and operations to adapt to risk that affects its capacities, the achievement of resilience should be reached from these two points of view.
Strategic resilience
From the strategic resilient viewpoint, a supply network must dynamically reinvent business models and strategies as circumstances change. It is not about responding to a one-time crisis, or just having a flexible supply chain. It is about continuously anticipating and adjusting to discontinuities that can permanently impair the value preposition of a core business with special focus on delivering ultimate customer centricity. Strategic resilience, therefore, requires continuous innovation with respect to product structures, processes, but also corporate behaviour. Renewal can be regarded as the natural consequence of a supply network’s innate strategic resilience .Operational resilience
In terms of operational resilience, the supply networks must respond to the ups and downs of the business cycle or to quickly rebalance product-service mix, processes, and supply chain, by bolstering enterprises agility, flexibility and robustness in the face of changing environments .See also
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