A Framework to Model the Topological Structure of Supply Networks

Abstract

Topological structure is considered more and more important in managing a supply network or predicting its development. In this paper, a new framework is proposed to model the topological structure of supply networks, where different types of supply networks can be created just by introducing different supplier-customer connecting rules. Generally, the networks created in the framework are much different from the random networks with the same degree sequences. The revealed phenomenon suggests that real-world supply networks may benefit from its intrinsic mechanism on flexibility, efficiency, and robustness to target attacks. Note to Practitioners-The topological structure of supply networks is considered more and more important in managing a supply network or predicting its development. In this paper, we introduce a framework to model and analyze the topological structure of supply networks. This work aims to characterize supply networks by statistical methods and can help researchers better understand the material dynamics on supply networks and further conveniently create their own supply networks by summarizing practical supplier-customer connecting rules or analyzing real-world supply network data. The work should be further expanded in other aspects, such as simulating material dynamics on supply networks, designing optimal structure by introducing proper supplier-customer connecting rules, rearranging local connections to enhance the competi tiveness and further ensure the long-term benefit of a target firm, and so on, all of which are of much interest for governors, investors, and managers and can be studied in the present framework in the future.