What are SBNs?

A Smart Business Network is defined as:

A group of participating businesses- organizational entities or “actors” that form the nodes
Linked together via one or more communication networks forming the links, or lines, between the nodes
With compatible goals
Interacting in novel ways
Perceived by each participant as increasing its own value
Sustainable over time as a network

SBNs segregate the business logic from the execution processes and activities, i.e. they create a joint business operating system. This business operating system coordinates the processes among the networked entities; its logic is embedded in the systems used by these entities.

Smart actions create remarkable, “better than usual” results. To be smart in business is to be smarter than the competitors, just as an athlete considered fast means he is faster than the others.

What is the difference between Smart Business Networks and Supply Chains?

Supply chains or trees are particular instances from smart business networks. Business networks that are smart, however, display quick connect and disconnect capabilities; they can pick the best capabilities from many network actors, plug these capabilities together, and make these play in unision; they also control, or own, the business logic for cross-actor execution of business processes.

Supply Network: A network is a generalized graph consisting of nodes connected by links. A fully connected network is a graph where each node is connected to all the others. A business network is unlikely to be fully connected but will be partially connected.

Supply Tree: A tree is a hierarchical graph. It has no cycles and each node has only one parent.

Supply Chain: A chain is a sub graph of a tree where each link connects exactly to one other link

What should Smart Business Networks be able to do?

The following capabilities are seen in smart business networks:

Establishment of common understandings (meanings, words, ethics, commitments, contracts)

Membership selection

Linking: search, select, authentication, hand shake, trust

Goal setting

Interaction

Risk and reward management

Continual improvement

What is making a business network smart?

Quick Connect & Disconnect - The ability of quickly connected plug-compatibility enables superior response speed and greater component variety when presented with new product opportunities.

Pick, Plug and Play - Once a business network has been able to pick and plug the appropriate product and process modules together, it needs to be able to run, or “play” these modules in the operational environments of the network actors. This is what Web Services aim to achieve.

Own Business Logic - A business network operating system brings the advantages of making business processes portable and facilitates the end-to-end management of processes running across many different forms. It coordinates the processes among the networked businesses and its logic is embedded in the systems used by these businesses.