THE FRACTAL NATURE OF SUPPLY CHAINS

What is a fractal?

A fractal is a never-ending pattern

Fractals are infinitely complex patterns that are self-similar across different scales. Repeating a simple process over and over in an ongoing feedback loop creates them. Driven by recursion, fractals are images of dynamic systems – the pictures of Chaos. Geometrically, they exist in between familiar dimensions. Fractal patterns are extremely familiar, since nature is full of fractals. For instance: trees, rivers, coastlines, mountains, clouds, seashells, hurricanes, etc.

Abstract fractals, such as the Mandelbrot Set can be generated by a computer calculating a simple equation over and over.

 

Modeling supply chainsHow it works?

Using the fractal concept to model supply chains

Fractals are useful in modeling structures in which similar patterns recur at consecutive cycles or hierarchical levels, and in describing partly random or chaotic phenomena such as crystal growth and galaxy formation. Supply chains, when viewed from an entire industry point of view and considered at local level, national level and global level, also appears chaotic. They constantly change in terms of their fractal pattern. They shrink, expand, branch off and form confluences in line with the multitude of deals that are made between trading parties locally and abroad. The drivers of these deals are also the drivers of the fractal pattern. The interaction between these drivers is not controlled by any specific entity or governing power. And therein lies the random nature of supply chains. In spite of each country having oversight, regulations and rules about trade, and many commodities being subjected to different kinds of traceability measures, it still remains a daunting task to instantaneously map out the exact path in the form of a value chain journey a specific item has taken. Using fractal thinking in modeling the value chain audit trail while it is being created in real time, offers a precise basis for instantaneously mapping the fractal pattern. This pattern underlies the history of a specific item that is subjected to the fractal traceability approach.

How does Fractal Traceability TM works?

The fractal unit, which is the repeat unit of the specific fractal geometry that ultimately defines the fractal pattern, is represented by a minimum traceability data set that each participating organisation is communicating to a hosted environment where the value-chain item instance level traceability audit trail (which represents the fractal pattern) is being created and maintained. In its generic structure each fractal unit consist of the logic describing the advance of an item through a receive, transformation or conversion or production, and dispatch events, as well as a description of the logical relationship between a physical item, contained in the inventories of participating organisations, and the logical structure of formal trade between the same organisations. The programme or contract and order hierarchy of trade agreements and activities defines this formal trade structure. The same trade structure is also referred to and reflected in the underlying shop floor or factory floor activities.Fractal units link up and combine their data on the history of an item in the hosted environment according to the logic underlying dispatch and receive item-handling events between participating organisations. As a consequence the exact supply-chain pattern is created and maintained in the hosted environment without human intervention, effectively mirroring the physical supply-chain that an item, and its intermediate product items, travel through the value chain.