1. “Extracting Profit through Agility”
Value Networks
“Extracting Profit through Agility”

2. Agenda Supply Chain  Value Chain Value Chain  Value Network
Moving around the Value Network
Extracting Profit from the Value Network

3. The Supply CHAIN Producer Supplier Logistical Support Supplies
Products
Supplier
Logistical Support

4. The Value CHAIN Producer Supplier Logistical Support
Value is added by distributing the product where needed or desired
Supplies
Producer
Products
Supplier
Logistical Support
Value is added by bringing together supplies
Value is added by creating a product via processes

5. The Value NETWORK Buyer-1 Supplier-1 Producer Buyer-2 Supplier-4

6. Putting the “Value” in the Value Network
Buyer-3
Buyer-2
Buyer-4
Buyer-1
Supplier-1
Producer
Supplier-4
Supplier-2
Supplier-3
Buyer/
Supplier
At any point in this network, value can be added
At any point in this network, value can be added
At any point in this network, value can be added

7. Moving Around the Value Network
At each , value is added and profit can be extracted in return for this value. “Moving around the value network” can be very profitable for the agile firm

8. Extracting Profit Around the Value Network
Profit comes from finding buyer for reseller
Profit comes from facilitating supplier alliance
Profit comes from locating supplier for producer
Profit comes from turning buyer into low risk producer

9. General Principle
Value network integration means firms can play more roles more quickly
Finding out where value is added and how to manage that value-adding process is important
The more information content to the physical product, the more likely it is that agility holds the key to increased profit