Probably the simplest netchain is the one examining buyer-supplier relationships. Netchain analysis builds on the phrases above and focuses mainly on all type of interdependencies. Reciprocal interdependence combines pooled the previous two resulting in strong, direct relationships. Sequential interdependence occurs, when the output of one unit is necessary for the next other unit to operate. Pooled interdependence is a mutual, weak and indirect connection of several entities. Three kind of organizational interdependencies can be distinguished to examine the relationships of companies. Specific networks with mainly horizontal interdependencies are sequentially arranged based on their vertical ties between firms in other networks. The usual representation of netchains shows the horizontal and the vertical interdependencies across companies as well. Chain reflects the hard aspect, where products and money is flowing (chain) and network reflects the soft aspect, the network of people having informal relationships. The phrase netchain captures two main aspects of collaborations. The simplest situation is for companies to form a supply chain or network in which they are selling product to each other. In the more practical perspective netchain is used instead of " chain and network". From that point of view, the perspective is even more important than the object itself. In practice, the phrase netchain is often used in a more general way referring to a system which has chain and network characteristics as well. Netchain is a set of networks consisting of horizontal ties between firms within a particular industry or group, which are sequentially arranged based on vertical ties between firms in different layers. However, it differs in the focus and in the tools used from network science. In practice, netchain analysis is often used in a more general way referring to the perspective that takes into account chain and network characteristics as well. Netchain analysis emphasizes value creation and coordination mechanism sources corresponding to different kind of interdependencies. While supply chain analysis focuses on vertical and network analysis on horizontal interdependencies across companies, netchain analysis incorporates both type of interdependencies into one concept. Netchain analysis is a theoretical concept integrating supply chain management and network analysis which was introduced by Lazzarini, Chaddad and Cook in 2001.
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