3. Controlling the Supply Networks
Three basic strategies enable supply networks to create value:
• Sales volume increase (sell more)
• Sales revenue increase (sell for more)
• Margin of contribution increase (reduce cost)
These strategies should influence the business simultaneously as they do not compete with each other. Figure 2.6 illustrated the importance the supply network has on the value creation process—especially in complex environments with several governance diamonds. Therefore, the potential benefits of enduring alliances include the following:
• Accelerating the development of products, services, or processes: This includes the alliance with preferred product or parts suppliers or specialist IT or logistics service providers.
Get Managing Supply Chain Networks: Building Competitive Advantage in Fluid and Complex Environments now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.