Supply chain researchers claim a shift toward 'supply ecosystems'

UNIVERSITY PARK, Pa. -- A new article from Penn State Smeal College of Business faculty member Christopher W. Craighead and colleagues David Ketchen at Auburn University -- a 1994 graduate of the Smeal doctoral program -- and Russell Crook at the University of Tennessee suggest that disruptive technologies are creating an evolution from supply chains to “supply ecosystems.”

The article, “From Supply Chains to Supply Ecosystems: Implications for Strategic Sourcing Research and Practice,” will appear in a forthcoming issue of Journal of Business Logistics.

A “supply ecosystem,” the authors wrote, can help “reduce risk, improve customer responsiveness, develop innovative products and processes, and market innovations more effectively.”

They continued, “We define a supply ecosystem as a set of interdependent and coordinated organizations that share some common adaptive challenges and that collectively shape the creation and nurturing of a sourcing base that contributes to competitive advantage and superior performance.”

The three key implications of the shift toward ecosystems include:

-- “Co-opetition”: The term “co-opetition” refers to the simultaneous competition and cooperation. Though each member of the ecosystem is inextricably linked, they also compete with each other for resources.

-- Pursuit of dual goals for the creation of value: Though each member of the ecosystem’s goal is still to create its own value, it must also consider the good of the ecosystem. As the authors wrote, “(A) firm’s goals must sometimes be sacrificed for the greater good of the ecosystem.”

-- Common knowledge- and skill-base: Competencies that are shared across the ecosystem will benefit all member firms.

These new challenges, along with the needs to simplify the supply chain and manage disruptive technologies, will create a need for increasingly more strategic sourcing. The authors also contend that complex global supply chain networks may give way to more regionally based ecosystems.

Last Updated September 26, 2014