Value Nets: Breaking the Supply Chain to Unlock Hidden Profits

By Joseph Martha and David Bovet

"Value nets are digital powerhouses that fuel business results."-From the Foreword by Adrian Slywotzky If you have ever ordered a computer over the Internet and been amazed that a product built to your exact specifications could arrive at your door within days, or if your business's competition is suddenly gaining share by delivering custom-designed merchandise faster and more reliably than you can, you need to read Value Nets. Enlightened managers around the world are learning that the supply chain can be a bountiful source of profitable growth, increased market share, and shareholder value. Value Nets: Breaking the Supply Chain to Unlock Hidden Profits shows you how to release the value hidden in supply chain operations through new digital networked solutions. Value Nets introduces you to a new form of business design built around superb supply chain performance in the e-commerce world. This design enables any company to do far more with the supply chain than simply control costs. It provides a basis for true differentiation in the marketplace and gives you the power to deliver first-rate service and customized products to customers in ways that delight them and keep them coming back for more. Using numerous powerful case studies and examples from companies that have adopted value net design-Gateway, Cisco Systems, Cemex, Biogen, Zara, and dozens more-the authors demonstrate how value nets bridge the gap between the executive culture of strategy and business reinvention and the operational world of procurement, manufacturing, and logistics. They introduce the new concept of value nets and offer compelling evidence of their outstanding results. They also explain the five elements of value net creation, supplying specific examples from companies that have built value nets and showing how the new design helped these companies achieve superior profitability and customer satisfaction. Complete with an appendix that helps you think through the applicability of value nets to your company, Value Nets delivers everything you need to understand and implement this remarkable new business design. It captures the creativity of today's most effective business model and puts its power where it will do the most good-right in the palm of your hand. As one of the world's premier corporate strategy firms, MERCER MANAGEMENT CONSULTING helps leading enterprises achieve sustained shareholder value growth through the development and implementation of customer-focused business designs. Mercer's thought leadership on the topic of value growth is evident in four agenda-setting books published in the past four years: Profit Patterns, The Profit Zone, Value Migration, and Grow to Be Great. The firm serves clients from twenty offices in the Americas, Europe, and Asia."Value Nets exposes the supply chain for what it really is--a strategic differentiator. Reading about the success of Apple Computer, Zara, et al., will convince you that the time to take action is now!"-H. Lee Scott, President and CEO, Wal-Mart Stores, Inc. "Our experience is proof that the ideas presented in Value Nets work. Agile, networked operations help us deliver superb service to our customers and drive shareholder value as well."-James Mullen, President and COO, Biogen, Inc. "Value Nets takes supply chain management to the next frontier. CEOs will find it extremely helpful in their quest to provide better service and reduce cost by meeting unique customer requirements."-William "Gus" Pagonis, Retired Lt. Gen., U.S. Army Executive Vice President of Logistics, Sears, Roebuck and Company "Value Nets brings new concepts and a road map for competitive advantage to businesses in Latin America and other global markets where traditional supply chain thinking controls business design."-Julio A. Barea, President and CEO, Sara Lee Branded Apparel, Latin America Group

• Format: Hardcover
• Language: English
• ISBN: 0471360090
• ISBN13: 9780471360094
• Release Date: April 2000
• Publisher: Wiley
• Length: 288 Pages
• Weight: 1.25 lbs.
• Dimensions: 9.3" x 1.0" x 6.3"

Customer Reviews

Capturing value using a value net

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-alignmentCollaborative and systemicAgile and scalableFast flowDigitalValue 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 propositionStrategic control - elements that protect profits over timeExecution - operational excellenceValue 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).

Closest Yet, But ....

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

Great Book

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.

Must Read !

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 !

Customizing B2C

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.