by chiefstaff

February 12, 2013

In the traditional business world, relations between organisations were different from what they are today. Collaboration between organisations – if there was collaboration – used to follow a linear model. In fact, when several organisations had to collaborate, they used to do it through a very linear model, with traditional supplier-buyer relationships. This model is based on rigid hierarchical structure between the different actors. Although it could work in the old business world, it is a little more complicated today. However, the problem is that many organisations have not evolved according to the new globalised business world, and they are still using the traditional model. The key word for today’s business world is “network”. In fact, no business can be successful if “network” is not the basis of its logic. You can learn more about the importance of global business networks in Vivek Sood’s book, The 5-STAR Business Network (http://bit.ly/5-STARBN). Any decision and project must be based on the network today. Therefore, companies first have to build an efficient global business network, which will be the basis of its supply chain and its entire organisation structure. Thus, this is the first step for any single organisation. Besides, businesses do not act alone today: network involves multiple relationships and interactions between businesses. That is the reason why your supply network must be very flexible; it is because interactions are infinite. Therefore, when interacting together, in a business network, organisations have to do it in harmony, and with flexibility in their structure. The production teams and the procurement teams work together, to provide the best product to the customer. Collaboration is necessary in the relationship among the supply chain partners to create, market and sell the products. Likewise, collaboration is also required to make the products, move and store them. In other words, we have no choice but to admit that collaboration is necessary to build a great supply network and manage efficiently our supply chains. In effect, in today’s globalised world, collaboration is necessary during the entire process, so your supply chain can give the best results. Besides, your customer will be satisfied because of the efficiency of your supply chain, which will produce in the shortest period at the lowest cost. Then, your customer will have a good product, in a short delay, and at a reasonable price. That is the reason why you do not have other choice if you want to beat your competitors in the market place. Besides, your business network would be so big and efficient that your business will benefit from their know-how and knowledge. Therefore, you can also expect innovations. You will benefit from your partners’ innovation, which will help you create even more value than with your own innovation. Consequently, the power of modern supply chain models lies in collaboration and interaction. In effect, modern organisations cannot keep following the traditional linear model because there are many more businesses involved in a business network today than 20 years ago, for example. To summarise, let us say that today, supply chains involve many actors, which means that businesses must collaborate in a very flexible way, in order to get the best from each partner and provide the best product for the customer. This will lead to better results for businesses.


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chiefstaff

MORE INTERESTING READING
  • What does this new model mean for managers who are still faced with the day-to-day realities of meeting deadlines, schedules, and inventory requirements?

  • As this blog is too old, so it looks outdated but I think this model still into the effect. We are referring a few topics which can give us the idea to adopt a best suitable model for our production company. Your blog is impressive and provides what we are looking for. Still, we have confusion between you and another one.
    Here is the topic- “Winning strategies for emerging markets in Asia”
    Five strategies for success

    Asia’s continued high growth rates make it a very attractive market for global manufacturers and consumer goods companies. But the ability to take advantage of those opportunities is only available to companies that appreciate the diversity and complexity of the region. McKinsey’s research indicates that there are five key challenges or issues that companies must master to succeed in Asia:

    Succeeding with “last mile” delivery
    Handling extreme consumer diversity
    Unlocking the potential of e-commerce
    Managing risk through nearshoring
    Acquiring sufficient supply chain talent

    Please suggest why should we go with your suggestions?

  • it really helps to know about upcoming Business models in Supply chain. I found a more informative blog for “closed-loop supply chain network” with numeric problem-solving.

    You may refer it- (https://bit.ly/2zV50z0)
    “They presented an extended closed-loop supply chain network to integrate the environmental issues into a traditional logistic system. Our proposed chain contained four layers (manufacturers, DCs, customers, and dismantlers). Finding optimal locations of manufacturers, DCs, and dismantlers and distribution of product satisfying time windows were our purposes that are attained in a mixed integer linear programming approach. In this way, we proposed an approach as multiple DCs multiple traveling salesman problem (MDMTSP) between DCs and customers. In addition to managing properly reverse logistics to reduce the negative impact of greenhouse gases emissions, we focused on transport mode selection as a way to reduce emissions. For this, two types of regulations to reduce carbon emissions coming from freight transport were considered. The first mechanism specified a cost for carbon emissions and the second one was a constraint on emissions. Consequently, three models were formulated corresponding to these regulations and the effects of the regulations on the preferred transport mode and the emissions were investigated.

    The applicability and effectiveness of our proposed model were tested through a numerical example. Also, a comparative analysis was investigated on decision variables.

    Which one is good? Please suggest. Thanks

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