Supply chains were invented in the late 20th Century to achieve orderly transformation of material inputs into finished products for customers. For decades supply chains were seen as linear and mechanical processes. In these ordered systems, organizations strive to maximize their revenue within narrow, closely managed spheres of control. Most often, there is little or no knowledge or interest in the other actors in the supply chain. These supply chains are engineered with robust frameworks and models like Supply Chain Operations Reference (SCOR) and Global Supply Chain Forum (GSCF.)
In the 21st Century there has been a rapid evolution of the supply chain into loosely coupled, self-organizing networks of businesses. These value networks interoperate to furnish and improve complex product and service offerings. Value networks evolved because increasing supply chain complexity was not being met with the rigid engineering practices of the 1990s.
Value networks achieve mastery of the entire supply ecosystem -- including roles, relationships, skills, knowledge, brand, revenue generation and reputation, for example. While SCOR and GSCF furnish adequate models for natural resources supply chains and consistent, low-differentiated ‘smokestack’ manufacturing, they fall down in a world of dynamic offerings and products with extremely high degrees of knowledge content.
Value networks are complex sets of social and technical resources that work together via relationships to create goods, services and economic value. Value network analysis (VNA) is a methodology for understanding, using, visualizing and optimizing internal and external value networks to improve complex supply networks.
VNA works in concert with traditional supply chain management (SCM) to optimize roles and network intangibles to complete the entire system context and ecology. This in turn optimizes the entire supply network, including productivity, revenue and innovation. The business outcomes are far lower risk and much greater resilience, agility and stability in the supply chain. Overall supply chain equilibrium and operation is improved dramatically. Finally, value networks and VNA make innovation a natural property of the supply network, thus expanding sustainability and prosperity overall.
The Boeing Company and Royal Dutch Shell are among the advocates and users of value networks and VNA for supply chain transformation. Giant pharmaceuticals are embracing VNA for converting supply chains to networks and creating novel innovation pipelines. One supply chain integrator summarizes this way, “Now that I know the value networks methodology I would not consider doing a six sigma, Lean, or any other kind of project without first doing a VNA to provide the ‘systems’ context for the initiative.” | 
