HOW GLOBAL SUPPLY CHAINS ADD VALUE?
Consider this if you are a typical company your imports and exports have grown at least 20% over the last 10 years.
If you are one of those unique companies who prefer to deal only with local suppliers, then all that is happening is that there is a layer of rent-seeking middle-person who is importing on your behalf and Material flow to you.
Origination of Global Supply Chains
When the concept of the supply chains originated in late 70s, most supply chains were still national – while some were moving towards a regional structure. In fact, it might be fair to say that the Pan-European regional expasion of companys’ supplier footprint led to the origination or at least quick adoption of the concept in the business world.
Early Global Supply Chains
Here was a practical solution to a real business problem, created by practical people working in the consulting industry. That was before everyone else, including the academia jumped on the the band-wagon and over-complicated things for their own purposes.
However, the purpose of this post is to explore what happened to supply chain when the supplier network moved from a regional structure to a more global structure.
Global Supply Chains Expansions
Today, hardly a company exists (at least not a large one) which does not have suppliers located outside its immideate regional footprint. In fact even the smallest company will have suppliers spread around the world, and are not actively seeking direct supplies, rather than buy through middlemen who barely add any value.
No wonder the supply chain models of 80s and 90s are finding it very hard to cope with the globalisation of the Material flow. If you are reading this – what is your view on the matter?
Evolution of Global Supply Chains
Do we need to move beyond Global supply chains (And please don’t talk about Procurement network or supply clusters – they are really same things in a more expanded format, merely semantics in most definitions) – into the realms of something totally new.
Or, do we need to just expand the reach of the current supply chain models? Or, do we need to expand the supply chain models? Please express your opinions below or by email to me..
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