Customer Reviews

Value Nets: Breaking the Supply Chain to Unlock Hidden Profits

5 star:		(2)
4 star:		(5)
3 star:		(2)
2 star:		(1)
1 star:		(0)

 

 

This book is the closest I have read in delivering a practical understanding of how to tear apart the supply chain in your industry and re-assemble it to better deliver value to your customers.

It does provide real emphasis on getting to know what the customer wants and then working to deliver this - first, second and last.

That said, the authors do then readily accept what the currently successful players tell them about how they did thier customer alignment. There is very little on HOW you can learn do do the same.

There is no critical assessment of how (say) Gateway have been right or WHY they are right today and if this is sustainable into the future. There is a lot of positive words about how well it works, but the assessment (to me) is very rear view mirror - telling what has happened and why we think it works, not drilling down to real customers and explaining what they took out as value from their buying experience.

This is a great book to inform an experience reader as to new possibilities - if you are new to supply chain thinking, do not start here, this assumes a high level of base knowledge and skills. If you want a solid foundation, read Michael Porter (Competitive Advantage) and Kuglin (Customer Centered Supply Chain Management) then come back to this book. And then get a blank sheet of paper to list out how your industry value chain can be re-written from the existing industry supply chain and then you are on the way to finding competitive advantage.

I would be interested in your thoughts - ingenuity@onthe.net.au

The primary tome of this work deals with customized B2C portals, and it's effect on both the consumer and the supply chain.

The book provides an excellent managerial overview, using extensive examples, of providing customer value as well as optimizing supply chain efficiencies through the use of Value Nets. I was slightly disappointed that its focus was not more directed towards B2B, utilizing exchanges and portals, however since that is not it's focus, I can't really complain.

If you're looking for a book to establish a framework for optimizing the B2C channel, however, this is an excellent start.

Value Nets is an intriguing look at businesses that have revolutionized the way the do business by revolutionizing their supply chain. What is a Value Net? According to the author a value net "is a business design that uses digital supply chain concepts to achieve both superior customer satisfaction and company profitability". One of the main concepts of a value net is that it operates in parallel manner rather then a rigid sequential chain.

Value Nets have the following five main characteristics:

Customer-alignment
Collaborative and systemic
Agile and scalable
Fast flow
Digital

Value Nets builds on the work of The Profit Zone, which define five elements of a value-creating business design. These five elements are defined as follows:

Value proposition - a company's value proposition consists of products and services that add value to customers.
Scope - what activities are required to deliver the company's value proposition and who delivers them (internal or partner).
Profit capture - mechanisms that capture profit from the value proposition
Strategic control - elements that protect profits over time
Execution - operational excellence

Value Nets take the five characteristics of the value net and show case studies of how companies implemented value nets within the context of the five elements of business design listed above.

The models that this book lays out are quite useful for considering how a product or service is delivered. The case studies and example in this book are quite useful and cover several industries. Most of the examples relate to product companies, but the concepts can be applied to services companies as well.

This book is a interesting and useful read for business consider how to interact with partners, competitors, suppliers and customers in the digital age. I would recommend reading the Appendix Value Net Self-Diagnostic first because is a great intro to the book. If this book resonates well with you might also like How Digital Is Your Business and The Profit Zone (also from Mercer Consulting).

If you're interested in supply chain management issues or e-business, you won't find much here. It's mostly a rehash of the other Mercer Consulting Book, The Profit Zone. Very general in nature, there's not much new material here. Read The Profit Zone and leave this one in the bin.

This book is not primarily about eBusiness, but about the application of general management knowledge (such as customer focus etc.) in an internet - enabled world. As such it does not present new concepts for eBusiness. It merely summarizes old and well known cases and makes them fit to the own model of 5 "elements of business design". The book might be nice for beginners to see what is possible nowaday's but of little help if you want to learn really new concepts. Last point: the content could well be condensed to fit on 100 pages, 4 repetitions of everything are really of little use.

Merits: A systematic framework to understand how digital supply chain can apply to businesses. Good comparison with traditional supply chain (systematic vs. sequential). A few cases are detailed and insightful. For a fan of Mercer's Business Designs, it will be delightful to see how the authors fit the two together.

This book will be more readable if contents are cut by half. Many contents are repetitive. "The Profit Zone" is full of new ideas, "Value Nets" is filled with consultants' empty statements. Some cases only talk about what happened, but not why it happened and how.

I gave "The Profit Zone" five stars, "Value Nets" deserves only three.

Enormous profits are hidden away in the supply chain, say the authors. You can find new value in the operating end of your business- how you handle orders, source components, build your products and get them to customers. The key to unlocking this potential profit is an entirely new business design, the value net.

The value net is a system driven by customer choice, not the company. Today's customers demand exceptional convenience, speed, reliability and customization. These objectives are difficult to achieve with traditional supply chain management. The value net combines recent advances in supply chain management and strategic thinking to deliver more flexibility, speed and customization. The value net approach begins with the goal of creating value for customers. It is demand-driven. This is a contrast to traditional supply chain management which is driven by manufacturing needs, or supply-driven.

This new business model is based on five key elements.
1. Value proposition: Determine what the company will offer to potentially profitable customers, in terms of convenience, speed, customization, etc.
2. Scope: Determine which activities need to be performed to meet these goals, and who will perform them. Consider outsourcing activities to others to add value and efficiency.
3. Profit capture: Determine how the company aims to earn a compelling return on shareholder investment. Break down returns from benefits offered to customers like superior service, creative solutions, and costs and assets.
4. Strategic control: Maneuver to protect the profit stream over time through sustainable competitive advantages. Control your brand reputation and your relationships with supply partners. Use innovative design to pass on low-cost products and services to customers.
5. Execution: Use human capabilities and digital technology to hold all the elements together. Cultivate a team oriented culture fully supported with digital technology.

This book is very well written and is ideal for those who want to gain an edge in profiting from the Value Chain to their maximum advantage. This book has done an excellent job in synthesizing other seminal works (Michael E. Porter's 'Competitive Advantage', Slywotzky and Morrison's 'Value Migration', 'Profit Zone', and 'Profit Patterns') and presenting the materials as a coherent systematic tool for analyzing operational supply chain problems. The case studies are well chosen and the diagrams at the end of the book are ready made summaries/checklist. The topics are based on a framework of Value Proposition, Scope, Profit Capture, Strategic Control, and Execution. This book is a must read for anyone who wants to get a practical understanding and use of the Value Chain.

Have the latest information up to date information of Supply Chain. Have comparision of the traditional SCM vs the latest idea..

Very easy to read, good diagrams !

My friend had hit upon on this book and recommended me to read this book. I found this book providing great insights into the world of changing supply chain management and how internet is creating value for the customers and breaking down the costs in the supply chain.