One of the difficulties in developing a coherent operational strategy is to know how the various elements of a manufacturing system interact and to assess the relevant importance of each. Looks at the manufacturing systems and how complex they are. A measure which calculates the systems′ complexity and the contribution from each operational source has been developed. It thus provides a tool that can assist in a strategy development exercise by quantifying the problem areas on a common basis. The approach has been used at three manufacturing sites. The resulting analysis allowed the local management, in each case, to identify the key areas of weakness, in both the short and medium term. As such it gave each of them a possible starting‐point from which to formulate an operational strategy.

In a dynamic environment such as the supply chain, even basic supplier‐customer systems with structurally simple information and material flow formations have a tendency to exhibit operational complexity. The operational complexity of supplier‐customer systems is primarily characterised by the uncertainty of the system. As the operational complexity of a system increases there is an associated increase in the amount of information required to monitor and manage that system. Based on this understanding, a novel information‐theoretic entropy‐based methodology for measuring and analysing the operational complexity of supplier‐customer systems has been developed. This paper makes contributions in the theoretical, conceptual and practical developments of the methodology. The methodology can quantitatively detect and prioritise operational complexity hotspots. At the interface, the framework can identify and quantify the transfer of operational complexity. Within the internal manufacturing system, the framework provides a comparative operational complexity measure across sub‐systems such as flows and products. This entropy‐based methodology provides a tool for identifying and measuring four classes of operational complexity transfer corresponding to the extent to which organisations generate, absorb, export and import operational complexity.

This review aims to provide researchers and managers interested in supply networks with a strategic review of this rapidly expanding field. It does not attempt a comprehensive review of the enormous and fast growing literature but does present the breadth and depth of research and practice in the area. The central aspect of the paper is to suggest that the field can be viewed from four perspectives which all researchers and managers implicitly or explicitly use: upstream, as purchaser; downstream, as supplier; static network, as an auditor of position within its supply network, typically comprising several supply chains, providing a static and comparative view; and dynamic network, as strategist, seeking opportunities to improve the firm's position in an existing network or creating a new network, providing a strategic, dynamic and long-term view.

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