The Supply Chain of the 21st Century

There is great value in harnessing the power of supply chain ecosystems to drive growth and efficiency in a business. Applying ecosystem principles helps businesses create and master this "chain of chains" that envelops the multi-enterprise scope of the...


The ultimate value of an initiative includes efficiency leaps, adoption of future capabilities that will keep the ecosystem from ultimately becoming extinct or tighter ecosystem communities. Initiative end-states are often expressed as improvements or changes in collaboration and transactions. Initiatives can create powerful positive leaps. They also can create an imbalance between members of the supply chain that is a competitive edge for some members and a Darwinian effect to others.

Ecosystem Adaptation

Adaptation occurs when a supply chain participant, population or community must align itself with the ecosystem environment for the purpose of survival (keeping existing relationships alive) or value increase (efficiency, speed, profitability, etc). Adaptation occurs within all categories of action in an ecosystem. There are two areas that impact adaptation: activity volume and disruption:

* Activity volume varies widely within an ecosystem based on the ability of the population to absorb the activity. Transactions and predefined styles of collaboration have tremendous tolerance for very large volumes. They are highly adaptive to volume scalability without significant stress on the ecosystem or cost to accomplish the volume. Complex collaboration is not predictable or well defined, and almost all initiatives have low tolerance for high volume. They quickly experience effectiveness breakdowns due to the lack of preparedness of the ecosystem to embrace and absorb the activity.

* Disruption sensitivities also widely vary. Transactions generally have little to no tolerance for disruption. This is particularly true of real-time or near-real time transactions and transactions that, by their execution, create time-dominant dependencies (order sourcing transactions to determine carrier, route and distribution flow). Collaboration on the whole has general tolerance for disruption but must be tuned to absorb disruption. This is often done with processes and event triggering mechanisms but in some instances it is done manually, through close coordination between human buyer and supplier. Initiatives, almost by definition, are high disruptors and rely on disruption as a driver of change and adoption. In the most altruistic sense, initiatives seek to change the status quo through innovation to create a new generation of efficiencies. Without this kind of disruption, there would be little improvement in an ecosystem.

The speed and effectiveness of adoption is based on several factors that impact the members and the ecosystem as a whole:

* Level of sophistication of the member. All members of an ecosystem are not equally sophisticated in vision, process, technology or resource talent. Members that excel in this area have much higher odds of success with effective change definition, execution and completion.

* Member impact. The amount of "push and pull" impact a member has within their ecosystem affects adoption rates of a member. The ability to drive one's view, require specific standards adherence, create standards or advocate for a position all make a smoother adoption for the member with leverage.

* Tolerance of change by the member. Change adverse organizations or members that are somewhat insular from the ecosystem will struggle to adopt change at a pace consistent with the velocity of their ecosystem.

* Ability to focus and invest. The ability of the member to take on the change, both philosophically and from an investment perspective aids in the adoption process, the odds of success of adoption and likelihood that the member's organization will embrace the change leading to adoption.

* Previous successes or failures within the ecosystem. Ecosystems that, as a whole, have a track record of successful change that positively impact all members are more tolerant of change, more open to mandate and more likely to innovate.

Ecosystem Management

Effective management is critical to the success of the members in a given ecosystem. In a multi-enterprise environment, transactions and collaboration seek to optimize the value of the ecosystem to each member. This is typically experienced in the cost-effective generation of revenue. Given the complexities of a given ecosystem and the reality that at any given time there will be at least one initiative exerting pressure on the concepts and processes of the ecosystem, management is very fluid and is based on the impacts of the major areas of action reviewed earlier: transactions, collaboration and initiatives. There are two basic kinds of ecosystem management:

  • Enhance Your Experience.

    When you register for SDCExec.com you stay connected to the pulse of the industry by signing up for topic-based e-newsletters and information. Registering also allows you to quickly comment on content and request more infomation.

Already have an account? Click here to Log in.

Enhance Your Experience.

When you register for SDCExec.com you stay connected to the pulse of the industry by signing up for topic-based e-newsletters and information. Registering also allows you to quickly comment on content and request more infomation.

OR

Complete the registration form.

Required
Required
Required
Required
Required
Required
Required
Required
Required
Required
Required