| Chapter 1: | Objectives, methodology, approach and definition of terms |
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These dynamic Supply Chains promote, amongst other things, the development of new business strategies. Within this framework, focus is placed upon new methods of customer integration, outsourcing of business functions, cooperation with customers and suppliers51 and inventory management.52 By these means traditional linear Supply Chains are converted into dynamic SC networks.53 A further integral SC element is represented by its value generative character (value-add).54
According to this, the Supply Chain is a network of organizations, which are associated with each other in a forward- and backward-facing manner, in order to generate value within diverse processes and activities. This value is reflected in products and services which are delivered to the end consumer.55
Normann and Ramirez describe the connection between value generation and the respective business and Supply Chain strategy as follows:
With consideration given to value generation, aspects of ?information technology can finally be integrated into the operationalization of a Supply Chain. The result is a so-called Value Chain (VC). Accordingly, a Value Chain represents a business outline that uses digital SC concepts to ensure not only customer satisfaction,57 but also profitability.58 The VC focuses mainly upon the competitive factors of time and flexibility59 and has the primary objective of being able to react quickly and flexibly to changing customer requirements.
The special characteristics of a value chain pronounce a distinct difference from a traditional business outline and may be described as follows:60