Why Value Networks Are Better Than Traditional Supply Chain Management

In this article:

• Problems with the traditional supply chain approach
• What is a “value network”
• What value networks offer the organization

We are on the brink of a major shift in the way that businesses work. Enabled by ever-improving digital infrastructure, spurred on by technical innovations of all kinds, and accelerated by the COVID-19 pandemic, supply chains are increasingly evolving into value networks.

Traditional supply chains are based on the one-way flow of goods or services from supplier to manufacturer to the customer (reverse logistics notwithstanding¹).

The value network, however, introduces the idea of a product or service process that is demand-driven, digitally interconnected, and as Deloitte pointed out, often collaborative. Agile and resilient, value networks are even more important in an era of ongoing disruption.