Description
SCOR modeling is referred as the most popular methodology to analyze the SCM performance of the organization
Supply Chain Evaluation and Process Measures - SCOR
1
GLOBAL
INTRODUCTION
• SCOR modeling is referred today as the most popular methodology to analyze the SCM performance of the organization. • SCOR is recognized by 8000 member companies of Supply Chain Council (SCC) as an
effective “toolkit” for companies wanting to upgrade their supply chains for strategic
advantage. • Scope of SCOR spans between supplier’s suppliers and customer’s customers
2 2
GLOBAL
PRINCIPLES APPLIED IN THE MODEL
• Process reference models integrate the well-known concepts of business process reengineering, benchmarking, and process measurement into a cross-functional framework.
BPR Benchmarking Quantify the operational performance of similar companies and establish internal targets based on “best-in-class” results Best Practices Analysis Process Reference Model Capture the “as-is” state of a process and derive the desired “to-be” future state. Quantify the operational performance of similar companies and establish internal targets based on “best-in-class” results. Characterize the management practices and software solutions that result in “best-in-class” performance
Capture the “as-is” state of a process and derive the desired “to-be” future state.
Characterize the management practices and software solutions that result in “best-in-class” performance
3 3
USEFULNESS OF A PROCESS REFERENCE MODEL
• Process reference model provides companies with powerful tool in improving supply chain operations. • It allows manufacturers, suppliers, distributors and retailers with a framework to: ? Evaluate their own process effectively
?Compare their performance with other companies both within and outside their
industry segment ? Pursue specific competitive advantages. ? Use benchmarking and best practice information to prioritize their activities.
? Quantify the benefits of implementing change and
? Identify software tools best suited to their specific process requirements.
4
SCOPE AND STRUCTURE
Supply-Chain Operations Reference-model
Level 1 – Top Level
Level 2 – Configuration Level
Level 3 – Process Element Level
Not in Scope
Level 4 – Implementation Level
5
SCOR Level 1 : Process Definitions
• At this level a company need to make basic strategic decisions regarding its operation in the following areas: ? Delivery performance and Order fulfillment performance ? Production flexibility ? Supply chain management cost
? Productivity
? Warranty cost or returns processing cost ? Inventory days of supply ? Asset turns • The basic structure of the reference model focuses on the four key supply chain processes – plan, source, make and deliver along with the return process.
6
SCOR Level 1 : Process Definitions
Performance Metrics – Level 1 • Level 1 performance attributes are ?Supply chain reliability, ?Supply chain responsiveness,
?Supply chain flexibility,
?Supply chain cost and ?Supply chain asset management. • Performance metrics are used in conjunction with performance attributes.
7
SCOR Level 1 : Process Definitions
Performance attributes and associated level 1 metrics Performance Attribute Supply Chain Reliability Performance Attribute Definition The performance of supply chain in delivering the correct product to the correct place, at the correct time, in the correct condition and packaging, in the correct quantity, with the correct documentation, to the correct customer. Level 1 Metric Delivery performance and Fill Rates
?
Supply Chain Velocity at which a supply chain Responsiveness provides products to the customer Supply Chain Flexibility Agility of a supply chain in responding to marketplace changes to gain or maintain competitive advantage
Order Fulfillment Lead Times
? ?Production
Flexibility
8
SCOR Level 1 : Process Definitions
Performance attributes and associated level 1 metrics Performance Attribute Supply Chain Costs Performance Attribute Definition Costs associated with operating the supply chain Level 1 Metric
? ?
Cost of Goods Sold Total SCM costs
?Warranty/
Return processing costs
?Management
costs
Supply Chain Asset Management efficiency
Effectiveness of an organization in managing assets to support demand satisfaction. This includes the management of all assets, fixed and working capital
?Inventory ?Asset ?Cash
days of supply
Turns to Cash Cycle time
9
SCOR Level 2 :
• Level 2 defines 26 core process categories that are possible components of a supply chain.
• Organizations can configure their ideal or actual operations using these processes.
• The first step in SCOR level 2 is to create a physical layout of the supply chain. • The next step involves choosing the relevant SCOR Level 2 process elements and depicting them.
10
SCOR Level 2 :
Selective List of Process Elements
P1 – Plan
S1 – Source Stocked products S2 – Source Make-to-order S3 – Source Engineer-to-order S4 – Source Infrastructure
M1 – Make-to-stock M2 – Make-to-order M3 – Engineer-to-order S4 – Make Infrastructure
D1 – Deliver Stocked Products D2 – Deliver Make-to -Order Products D3 –Deliver Engineer-to-order Products D4 – Deliver Infrastructure
11
Customer
Source
Make
Deliver
Supplier
SCOR Level 2 :
Selecting and depicting the relevant SCOR Level 2 process elements (Illustration)
D2
S1
D2
S1
M1
D1
S1
D1
S1
D1
Supplier’s Supplier
Suppliers
Company
Customers
Customer’s customers
12
SCOR Level 3 :
• Level 3 provides the information required for successfully planning and setting goals for supply chain improvements. It consists of: ? Process element information inputs and outputs ? Process performance metrics ? Best practices where applicable ? System capabilities required to support best practices
? Systems / Tools
13
SCOR Level 3 :
Process element S1 with the information inputs and expected outputs (Illustration)
Inputs Sourcing Plans, Replenishment Signals
Dispatch info. materials from Suppliers Material Pull Signals
S1.1
Process Elements Schedule Material Deliveries
S1.2
Receive and Verify Material
S1.3
Transfer Material
Place Purchase Order Outputs
14
Receipt Verification
Receipt Verification
SCOR Level 4 :
• Level 4 focuses on implementation, i.e. putting specific supply chain improvements into action. • They could be like:
? Select Carriers
? Route shipments ? Build Loads ? Consolidate Orders
? Reserve Inventory & Determine Delivery Date
? Receive Enter & Validate Order ? Process Inquiry & Quote
15
doc_231088228.pptx
SCOR modeling is referred as the most popular methodology to analyze the SCM performance of the organization
Supply Chain Evaluation and Process Measures - SCOR
1
GLOBAL
INTRODUCTION
• SCOR modeling is referred today as the most popular methodology to analyze the SCM performance of the organization. • SCOR is recognized by 8000 member companies of Supply Chain Council (SCC) as an
effective “toolkit” for companies wanting to upgrade their supply chains for strategic
advantage. • Scope of SCOR spans between supplier’s suppliers and customer’s customers
2 2
GLOBAL
PRINCIPLES APPLIED IN THE MODEL
• Process reference models integrate the well-known concepts of business process reengineering, benchmarking, and process measurement into a cross-functional framework.
BPR Benchmarking Quantify the operational performance of similar companies and establish internal targets based on “best-in-class” results Best Practices Analysis Process Reference Model Capture the “as-is” state of a process and derive the desired “to-be” future state. Quantify the operational performance of similar companies and establish internal targets based on “best-in-class” results. Characterize the management practices and software solutions that result in “best-in-class” performance
Capture the “as-is” state of a process and derive the desired “to-be” future state.
Characterize the management practices and software solutions that result in “best-in-class” performance
3 3
USEFULNESS OF A PROCESS REFERENCE MODEL
• Process reference model provides companies with powerful tool in improving supply chain operations. • It allows manufacturers, suppliers, distributors and retailers with a framework to: ? Evaluate their own process effectively
?Compare their performance with other companies both within and outside their
industry segment ? Pursue specific competitive advantages. ? Use benchmarking and best practice information to prioritize their activities.
? Quantify the benefits of implementing change and
? Identify software tools best suited to their specific process requirements.
4
SCOPE AND STRUCTURE
Supply-Chain Operations Reference-model
Level 1 – Top Level
Level 2 – Configuration Level
Level 3 – Process Element Level
Not in Scope
Level 4 – Implementation Level
5
SCOR Level 1 : Process Definitions
• At this level a company need to make basic strategic decisions regarding its operation in the following areas: ? Delivery performance and Order fulfillment performance ? Production flexibility ? Supply chain management cost
? Productivity
? Warranty cost or returns processing cost ? Inventory days of supply ? Asset turns • The basic structure of the reference model focuses on the four key supply chain processes – plan, source, make and deliver along with the return process.
6
SCOR Level 1 : Process Definitions
Performance Metrics – Level 1 • Level 1 performance attributes are ?Supply chain reliability, ?Supply chain responsiveness,
?Supply chain flexibility,
?Supply chain cost and ?Supply chain asset management. • Performance metrics are used in conjunction with performance attributes.
7
SCOR Level 1 : Process Definitions
Performance attributes and associated level 1 metrics Performance Attribute Supply Chain Reliability Performance Attribute Definition The performance of supply chain in delivering the correct product to the correct place, at the correct time, in the correct condition and packaging, in the correct quantity, with the correct documentation, to the correct customer. Level 1 Metric Delivery performance and Fill Rates
?
Supply Chain Velocity at which a supply chain Responsiveness provides products to the customer Supply Chain Flexibility Agility of a supply chain in responding to marketplace changes to gain or maintain competitive advantage
Order Fulfillment Lead Times
? ?Production
Flexibility
8
SCOR Level 1 : Process Definitions
Performance attributes and associated level 1 metrics Performance Attribute Supply Chain Costs Performance Attribute Definition Costs associated with operating the supply chain Level 1 Metric
? ?
Cost of Goods Sold Total SCM costs
?Warranty/
Return processing costs
?Management
costs
Supply Chain Asset Management efficiency
Effectiveness of an organization in managing assets to support demand satisfaction. This includes the management of all assets, fixed and working capital
?Inventory ?Asset ?Cash
days of supply
Turns to Cash Cycle time
9
SCOR Level 2 :
• Level 2 defines 26 core process categories that are possible components of a supply chain.
• Organizations can configure their ideal or actual operations using these processes.
• The first step in SCOR level 2 is to create a physical layout of the supply chain. • The next step involves choosing the relevant SCOR Level 2 process elements and depicting them.
10
SCOR Level 2 :
Selective List of Process Elements
P1 – Plan
S1 – Source Stocked products S2 – Source Make-to-order S3 – Source Engineer-to-order S4 – Source Infrastructure
M1 – Make-to-stock M2 – Make-to-order M3 – Engineer-to-order S4 – Make Infrastructure
D1 – Deliver Stocked Products D2 – Deliver Make-to -Order Products D3 –Deliver Engineer-to-order Products D4 – Deliver Infrastructure
11
Customer
Source
Make
Deliver
Supplier
SCOR Level 2 :
Selecting and depicting the relevant SCOR Level 2 process elements (Illustration)
D2
S1
D2
S1
M1
D1
S1
D1
S1
D1
Supplier’s Supplier
Suppliers
Company
Customers
Customer’s customers
12
SCOR Level 3 :
• Level 3 provides the information required for successfully planning and setting goals for supply chain improvements. It consists of: ? Process element information inputs and outputs ? Process performance metrics ? Best practices where applicable ? System capabilities required to support best practices
? Systems / Tools
13
SCOR Level 3 :
Process element S1 with the information inputs and expected outputs (Illustration)
Inputs Sourcing Plans, Replenishment Signals
Dispatch info. materials from Suppliers Material Pull Signals
S1.1
Process Elements Schedule Material Deliveries
S1.2
Receive and Verify Material
S1.3
Transfer Material
Place Purchase Order Outputs
14
Receipt Verification
Receipt Verification
SCOR Level 4 :
• Level 4 focuses on implementation, i.e. putting specific supply chain improvements into action. • They could be like:
? Select Carriers
? Route shipments ? Build Loads ? Consolidate Orders
? Reserve Inventory & Determine Delivery Date
? Receive Enter & Validate Order ? Process Inquiry & Quote
15
doc_231088228.pptx