A complex network approach to supply chain network theory

Abstract

PurposeThe purpose of this paper is to advance supply chain network theory by applying theoretical and empirical developments in complex network literature to the context of supply chains as complex adaptive systems. The authors synthesize these advancements to gain an understanding of the network properties underlying efficient supply chains. To develop a suitable theory of supply chain networks, the authors look to mirror the properties of complex network models with real‐world supply chains.Design/methodology/approachThe authors review complex network literature drawn from multiple disciplines in top scientific journals. From this interdisciplinary review a series of propositions are developed around supply chain complexity and adaptive phenomena.FindingsThis paper proposes that the structure of efficient supply chains follows a “scale‐free” network. This proposal emerges from arguments that the key properties of efficient supply chains are a short characteristic path length, a high clustering coefficient and a power law connectivity distribution.Research limitations/implicationsThe authors' discussion centres on applying advances found in recent complex network literature. Hence, the need is noted to empirically validate the series of propositions developed in this paper in a supply chain context.Practical implicationsIf efficient supply chains resemble a scale‐free network, then managers can derive a number of implications. For example, supply chain resilience is derived by the presence of hub firms. To reduce the vulnerability of supply chains to cascading failures, it is recognized that managers could build in redundancy, undertake a multi‐sourcing strategy or intermediation between hub firms.Originality/valueThis paper advances supply chain network theory. It offers a novel understanding of supply chains as complex adaptive systems and, in particular, that efficient and resilient supply chain systems resemble a scale‐free network. In addition, it provides a series of propositions that allow modelling and empirical research to proceed.

How does firm innovativeness enable supply chain resilience? The moderating role of supply uncertainty and interdependence

“…Risks and disruptions in supply chains could lead to severe negative impacts on a firm (Hearnshaw and Wilson 2013). Hence, as Ponomarov and Holcomb (2009) argue, understanding the capabilities leading to firms' SCR becomes extremely important under uncertain and adverse conditions.…”

“…Accordingly, supply chains become highly susceptible to various risks that could stem from one or more activities or actors (Hearnshaw and Wilson 2013). Thus, it becomes important to develop a better understanding of the resources and capabilities that could be utilized to overcome adversities and disruptions and attain SCR against such disastrous incidents.…”

“…Supply chains are systems consisting of numerous actors and processes with different vulnerabilities and risk propensities (Hearnshaw and Wilson 2013) as well as tight couplings and complex interactions between these actors and processes. Accordingly, supply chains become highly susceptible to various risks that could stem from one or more activities or actors (Hearnshaw and Wilson 2013).…”

The Prism of Elasticity in Rebound Effect Modelling: An Insight from the Freight Transport Sector

“…Similar to the idea presented here, but at a lower scale of analysis, supply chains are approached as evolving networks exchanging 'materials and information' [44]. Few studies, however, take a strictly quantitative approach to describe the structure and properties of such networks [45]. Interestingly, according to a wide and accurate review dated 2013, none of the 126 articles assessed consider supply chain networks as spatial networks, where spatial effects (or transports) would be a factor shaping their topology [46].…”

Alliance strategy: context, process, and requirements

“…conceptual generalization (Yin, 2003), requires reflection on the type of organization studied and its industry. Our research suggests that conceptual generalization may be limited to organizations in the public sector that use high-tech resources and are involved in complex supply chains with a limited number of suppliers (Hearnshaw and Wilson, 2013;Provan and Lemaire, 2012). Moreover, on the supply side, we included organizations that operate on low volume, complex product-service systems (Caldwell and Howard, 2010).…”