Supply Chain Viability
Origin and Definition of Terms
Supply chain viability (SCV) is defined as the ability of supply chains to function efficiently, resiliently and sustainably in the long term. Unlike traditional approaches, which focus primarily on efficiency, SCV aims to strike a balance between efficiency, resilience and sustainability. The term 'viability' encompasses more than just short-term economic efficiency; it signifies the ability to function over the long term in changing conditions.
Context of origin and scientific background
Against a backdrop of increasing global crises, from the Coronavirus pandemic to the Suez Canal blockade and geopolitical tensions, the concept was developed. These events have highlighted the vulnerability of supply chains that focus solely on efficiency. At the same time, there has been a growing push to integrate environmental and social standards into value chains. SCV was developed in response to these challenges and was first introduced by researchers Ivanov and Dolgui in 2020. The project presented here builds on these initial approaches, developing them into a practical concept for companies to implement.
Goals and Motivation
Why do we need a viable supply chain?
Supply chains face a structural dilemma: it is not possible to optimise efficiency, resilience and sustainability independently of one another. Each dimension influences the others, often in the form of conflicting objectives. SCV does not seek to eliminate this tension, but rather to harness it productively. The objective is to maintain functionality even under volatile, complex and uncertain conditions.
What challenges does the concept address?
-
Overfocusing on efficiency increases susceptibility to disruption.
-
Resilience measures such as stockpiling or multi-supplier strategies can counteract environmental goals.
-
Sustainability initiatives often fail due to a lack of integration into operational supply chain processes.
​
SCV acknowledges these conflicting objectives and provides a conceptual and operational framework for addressing them.
Relevance for business and research
SCV provides companies with a framework for making strategic supply chain decisions that are sustainable in the long term. In research, SCV opens up new perspectives on the integration and operationalization of competing goals in a dynamic environment.
Reference Model for Supply Chain Viability
Structure and key elements
The SCV reference model is based on a systemic understanding and originates from biology (the Ulanowicz model). A viable supply chain exists in a state of dynamic equilibrium between efficiency, resilience and sustainability. This equilibrium depends on the context and shifts according to external factors such as crises, regulations, or technological changes.
Connection to efficiency, resilience, and sustainability
-
Efficiency ensures short-term profitability under stable conditions.
-
Resilience increases adaptability and crisis resistance.
-
Sustainability ensures long-term social and ecological legitimacy.
​
The challenge does not lie in maximising one of these dimensions, but rather in creating a harmonious and context-dependent balance.
Role of trade-offs and stakeholder perspectives
Trade-offs are an integral part of the SCV model. Rather than avoiding them, they are systematically identified and actively managed. Stakeholder dialogue plays a central role in this process, with the requirements and expectations of internal and external stakeholders (such as customers, suppliers and legislators) being taken into account and translated into target systems.
Outlook: From Viability to Livability
Expansion of the SCV concept
The development of supply chains has reached a milestone with the concept of supply chain viability. However, the journey continues with the concept of supply chain livability, which explicitly takes social factors into account. As well as economic and ecological sustainability, social sustainability is now also a focus, manifesting itself in fair working conditions, affordability and social benefits, for example.
Initial thoughts, differences, potential
While SCV focuses on ensuring the long-term survival of the supply chain, Livability focuses on improving quality of life, particularly for employees, customers, society and the environment. It's not just about resilience; it's also about actively shaping supply chains and achieving a positive impact.