Supply chain versus value chain: mapping the boundaries within a Hirschmanian framework

The many contributions made to supply chain theory are those related to the topography of supply chains. While this paper agrees that different supply chains may be shaped differently, it finds it difficult to accept the notion of a supply chain whose terminal point is not the customer. Therefore, this theoretical paper argues that a supply chain will remain largely vertical in shape even if aspects of it take different shapes. To bring clarity to this argument, the paper defers to Hirschmann's framework where the supply chain is discussed alongside the related concepts of economic sector, linkages, and industry. Doing so results in a conceptual framework that maps the place of the supply chain in the wider economy and proves that a supply chain is essentially vertical in shape and that a value chain is associated with backward linkage whereas a supply chain is associated with forward linkage.