Global Chains Analytical Frameworks

Many detailed frameworks have been used to examine supply chains in the global economy. These frameworks have been able to investigate the amount to which the global market has been harmed and put in place the required actions to overcome the current hindrance. Global Production Network, Global Commodity Chains, Global Value Chains, and Supply Chains are among the frameworks being considered. Each of the networks is critical to the global economy because it plays an important role in economic development (Study of Knowledge Management Frameworks, 2016). Global Production Networks enhance globalization since various ideas are generated on producing products and their shortcomings addressed. Various forms of political hindrances that can prevent the growth of the economy are looked into. The Global Commodity Chains influence some of the developments in the social arena. Projects which are not successful are able to be detected easily. These networks are thus affected by divergent factors which affect each of them and these factors should be reviewed before utilizing the networks. Appropriate policies should be enacted by the government such that both internal and external forces that are likely to obstruct the frameworks are countered with.

The Global Production Network

These are networks that necessitate intermediate markets and final markets. Both these markets are crucial in the global economy as they enable goods to be conveyed to consumers. Before the goods are transported to the consumers, the producer must be able to know the geographical location of the consumer. This is a greater advantage to the producer as he is able to access both final and intermediate markets easily. This network delivers innumerable advantages as it covers a wider area. First, it provides knowledge on how key information on the networks is circulated among the stakeholders involved in the business (Freinkman and Yakovlev, 2015). The stakeholders include intermediaries in the production network, consumers available and the producers. This network is able to provide information that is important to both social, global and the general regional economies as a whole. The networks involved in the production are able to steer the whole economy to a new level which ameliorates the economy nationally.

This framework is aware of the production territory hence an investigation has to be conducted on the political and social economies which constitute the economy. Naomi Klein’s article on labor shows that globalization is as a result of industries employing workers to enhance the production networks. The networks of production in these zones are constituted into preferred views. This is done to gain maturation locally (Lee and Villaruel, 2017). Since production has been increased development also increases through the whole territory. The production network also generates contrast between different stakeholders in the economy. The networks of buyer- driver and those of producer – driver in the economy are able to bring a combination of a product that is similar in the market thus promoting the economy (Ho, 2015). The Global Production Network is able to thrive under principal elements which include embeddedness, value, and power. The logistics industry is an example of the Global Production Network. This industry involves technologies which are new. These technologies enable an increase in management of time at the industry and also offer a reduction in the delivery of items.

The Global Commodity Chains

This is a type of network that links stakeholders and their interests in the economy. Factors which govern commodity chains are investigated and their limitations analyzed thoroughly. This type of chain is vital as it controls the flow of commodities in the global market (Auplat, 2012). The resources available in the chains are regulated to avoid insufficiency as they cover a wider area. Financial resources are allocated to the type of product they facilitate in the global market so that various risks are avoided. Material resources are crucial in this type of chain as they have to facilitate how far the commodity would reach. Products needed in regional economies have to be transported faster without getting spoiled. Those products that need to be availed to organizational economies have their principles which they follow so that they can reach easily. Resources which are incorporeal are allocated throughout the whole chain depending on the type of product involved (Connelly, Ketchen and Hult, 2013). The whole chain is distributed equally with each product allocated at its suitable place.

These types of chains are enhanced by firms which lead to the same level so that they can enhance production of more commodities. These type of firms have made impeccable growth in many industries including airplane and even shipping. These type of chains are also systematized as producer -driven and buyer-driven types. In producer-driven type of chains, the commodities are produced by leading firms. They are also able to benefit from this chain as they add a great value to the chain (AGUS, 2011). The buyer-driven chain type is one where the firms leading in that sector benefit from activities which add a greater value to the economy. The firms themselves are able to produce their own products and sell them as well. These type of leading firms include the designers of that specific commodity, the retailers of the particular product involved and the branders of that product. This type of chain has been instrumental in shaping how production is conducted and also matters relating to the governance of the economy (Batt, 2011).

The Global Value Chains

These type of chains have been instrumental in the globalization of industries. The Global Value Chains are involved in the governance of structures which include hierarchy, relational, markets, modular and captive. The hierarchy type shows how chains are controlled in the managerial and vertical manner in the firms that are leading in the development of products. The relational type describes how sellers and buyers rely on information that is not transmitted easily in the economy. The market type gives transmitted information on how a product is conveyed in the market. In the captive type of network, unestablished suppliers are dependent on the established buyers who have a lot of experience in the economy. In the modular type of network, transactions which are complex are organized easily (Sinha, 2011).

Diverse methods have been established in the analysis of Global Value Chains. An input to output mode in the structure has been utilized. This is where raw materials are converted into products which are final. The mode of governing the structure is also a resourceful method as it explains how a product is controlled in the Global market. The context of the institution is another way. This is whereby the value in the economy is embedded. The last method is the consideration in the geographical location of the market (Special Topic Forum on Resources and Supply Chain Management, 2013). This is whereby the structures of the companies are identified and each of the segments is characterized.

The Global Value Chains are vital as they determine different roles they participate both in the developing and developed countries. They propel the economy of these countries to greater heights. They also aid one in understanding why industries in the global economy are organized in a particular way and how they can be reached out to. They are able to make one understand different stakeholders involved in the global market and how they should treat them. They also play a crucial role as they help stakeholders trace different patterns in the global market. They can understand the industries behavior and get along with them. The global value chains enables one get answers relating to different questions as those involved in the policy markets are able to explain the varying global situations.

The Supply Chains

The supply chains are important as they help practitioners understand the structures of power. They are networks of organizations which are working together to control the resources flow. These networks depend on each other either mutually or exclusive. In this type of chain, products which are specific are produced into the market. Resources that are available are put together so that they can be delivered into the market. Services are then rendered to the customers in a good way for their consumption. The flow type in this chain is what determines the control of the resources in the market. A strategy that is competitive is employed in this type of chain. The strategies used include a strategy that is corporate, a strategy that is functional and that one which is business oriented.

There are two different approaches to solving the issue of the supply chain. One of the ways is the advantage of the value and the other is the cost of advantage. The value of advantage entails that customers benefit from the products rather than purchasing the products. The cost of advantage entails only one competitor who has the highest number of the sales he has made. There is also the aspect of the value chains which involve activities that support the system and those which are primary. The supply chain is so competitive and it offers a greater performance. An example is those driving trucks that deliver items. These trucks are required to reach a particular destination. Technologies have to be improvised on how they are going to supply these products.

Walmart chains analysis

Next, I will discuss an application of some of the analysis frameworks named above to the business of Walmart. John Dudovskiy has used the first type of framework, the global value chain, for business analysis. In its article author provides the structure of Walmart value chain and practices/ principles that help to make work on every step of the chain more efficient. Among activities that he uses are primary ones: inbound logistics, operations, outbound logistics, marketing and sales, service. This analysis notices such principles applied by Walmart as minimization of links in the chain, direct work with manufacturers and strict conditions for suppliers, use of cross-docking. The segmentation of Walmart operations includes Walmart US, Walmart International, Sam’s Club. In addition, discussed current improvements in outbound logistic and its complexity. Marketing and sales part discusses marketing channels of organization and its strategy; the service operations got a negative evaluation by the author (Dudovskiy 2016).

This report in its web-published part represents an input to the output mode of value chain analysis. The main accent is stressed to steps of value production, that are mostly related to logistics and sales as the organization is from the retail market segment.

The other analysis, by Market Realist talking about Walmart supply chain also concentrates on the question of supply chain management and informs about improvements on particular activities. However, formally the framework applied by author relates to the fourth described above, supply chain and distribution model. Among specific information about the chain provided data on e-commerce channels development, the structure of distribution facilities, influence of business scale on relations with suppliers, and cross-docking (Soni 2015).

In general, the focus of analysis in this paper in comparison to previous one is shifted to relations with suppliers and buyers. While in Value Chain Analysis such relations are just a required part of a chain of more processes, of both transportation and construction. Therefore, Value Chain Analysis may be represented by a graph where the focus lies on dots, in the supply chain it shifts to connections between such dots (distribution of goods vs. value construction).

The reflection of complex dynamics in the global economy through analytical frameworks above has its specific in every particular case. While Global Value Chain Analysis provides information about places around the world where the real value is constructed (independently on company headquarter placement) the Supply chain analysis tells more about interconnections and routes in the global world, however, both methods has overlapping pieces of information. In my opinion, Supply chain analysis reflects the features of globalism in business better.

References

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Batt, P. (2011). Supply Chain Management: Concepts and Application within the Transitional Economies. Banwa, 6(1).

Connelly, B., Ketchen, D. and Hult, G. (2013). Global Supply Chain Management: Toward a Theoretically Driven Research Agenda. Global Strategy Journal, 3(3), pp.227-243.

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Ho, P. (2015). External Economies in Trade and Development: Contrasting Arguments for Industry Promotion Under Alternative Analytical Frameworks. OEconomia, (5-3), pp.363-396.

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Sinha, S. (2011). Book Review: Emerging Trends in Supply Chain Management: Frameworks, Models & ApplicationsNarayanPrem, Emerging Trends in Supply Chain Management:

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