It may or may not be. It has an ‘inner ring’ of CDOs that invest with each other, an ‘outer ring’ of additional CDOs. Lines are drawn between the CDOs that invest with each other. Now, the graph represents the relationship between CDOs. How were those relationships established? What made one CDO decide to invest in another? Did a central planner make all those decisions? Someone in a head office decided that CDO X should invest in CDO Y but not CDO Z? Are all of those connections part of a grand central office design, or do they represent individual decisions of traders or managers over time?
Whatever value those lines represent has to do with the decisions made in establishing that line. A connection made for no reason has no value. How much value is in each line really depends on that decision-making.
The point I tried to make is that a supplier connection can represent years of work making that connection efficient. It can be the result of engineering analysis of a precise problem leading to a choice of supplier, or work with an existing supplier to make a material usable. Supply chain management is a huge field, and intense effort is made to improve the supply chains over time. The complexity of them arises not from one factory choosing suppliers, but that the suppliers can also choose suppliers. It’s even common for loops to happen. Company A can be a supplier to company B for one product, while company B uses company A as a supplier for their own products. Happens all the time.
The complexity can have negative effects. For example, a supply chain manager can pick two different companies to supply raw materials for redundancy. But unknown to the manager is that the two companies are inter-related through a third company, and if the third one fails, both of the others do. Or the common failure could be many levels and thousands of connections down.
The graph I showed is very simplified. It only shows the first level of supply for one company for a single line of products. If I tried to show all the secondary and tertiary links, etc, you might get something more like this:
That’s actually a partial map of the internet, but it’s the result of the same ad-hoc, bottom-up organizational process. I have seen supply chain diagrams that look just like that. Each one of those bright ‘supernodes’ might be a huge factory, or a common supplier. It’s all completely unpredictable, complex, and dynamic. It changes by the minute.
They are both examples of Complex Networks.
From Wikipedia: