What’s in a name? When it comes to supply chain – a concept and industry with a reputation for an unfortunate amount of jargon – there is rather a lot in a name.

At an invitation-only gathering of some of the best global minds in supply chain in Sydney at the end of February, there was unanimity and not a little passion over the idea that the phrase ‘supply chain’ is inadequate for what it is supposed to be describing.

The phrase fails on several levels. It implies an approach to the ‘chain’ from the wrong direction entirely – an effortful push rather than the more natural pull that results from good customer understanding and good demand forecasting, which are core parts of supply chain management. Use of the word ‘chain’ is also a problem. Its linear and restrictive connotations belie the true complexity of an industry that stresses flexibility, innovation and, above all, value creation.

On a daily basis, supply chain is too readily confused with logistics. Logistics is a key part of the business of supply chain management. But it is only one part, and it is a part that should in fact be largely designed and driven by other elements of supply chain management.

Keith Oliver, a vice president with the London office of Booz Allen Hamilton is credited with coming up with the phrase supply chain in 1982. It was probably also in the 80s that the term logistics, considered the forerunner of supply chain, started to be widely applied in commercial business (It was used in a military capacity long before that – the ancient empires of Greece and Rome had military officers called ‘Logistikas’ who were responsible for supply distribution).

So what are our alternatives? ‘Value chain’ and ‘demand chain’ are both suggested and, in the case of the former at least, has been used not uncommonly for decades. Michael Porter introduced the term value chain in his 1985 book ‘Competitive Advantage, Creating and Sustaining Superior Performance’.

Both value chain and demand chain look at things from a better perspective, but both fail to remove the linear connotation of what is inarguably a three dimensional concept. At the summit in Sydney, it was ‘Value Networks’ that was selected the preferred phrase. The term ‘network’ is widely applied to supply chain in the book ‘Competing in a Flat World’ by Victor and William Fung and Jerry Wind of Wharton University.

Although our industry has a reputation for jargon, this discussion is not simply a matter of playing with words. Like many in supply chain, I am constantly asked by outsiders to define the phrase and need to speak for ten minutes and draw a diagram to get people starting to understand. I flinch every time I see the term used incorrectly in general and business media.

As I see it, the term ‘supply chain’ fails to provide a semantic framework for the truth that supply chain is not just something people and companies do, but is a mindset: a more effective way of looking at and developing any business or organisation in an increasingly globalised and complex world.

As a career media person, I know intuitively ‘Value Networks’ will be greeted with groans by the jargon-skeptic general public, and by many who should know better or who are not prepared to put thought into the concept in the first place. I have not yet requested my designer to come up with a ‘Value Networks Asia’ masthead for our magazine and portal. But given how quickly this industry and the markets it serves are evolving, I am not ruling anything out.

Turloch Mooney

Please email Turloch at turloch.mooney@supplychainasia.org if you have thoughts, opinions or suggestions relating to supply chain terminology.