Degree of Centralization: Impact on the Economic Efficiency by Considering Different Waste Types

Global production networks (GPN) developed to complex systems. To handle the complexity and be able to react quickly on uncertain changes, the management of production networks becomes increasingly important. Especially the digitalization and the associated transparency offers the opportunity for an active network management and the design of the degree of centralization. The presented paper introduces an approach to describe the influence of the degree of centralization on the economic efficiency by considering different waste types. Therefore, on the one side the waste types for indirect functions are outlined and on the other side relevant economic aspects for the network management. Afterwards, both considerations are combined under regard of the degree of centralization to describe qualitatively how the degree of centralization can reduce the occurrence of waste and enable a more efficient network management.