1. INTEGRATING THE SUPPLY CHAIN TO REAP THE REWARDS
CHAPTER 7
INTEGRATING THE SUPPLY
CHAIN TO REAP THE
REWARDS

2. Learning Objectives Understand the History and Context of SCOR
Learn the Components of the SCOR Framework
Process Nomenclature
Process Metrics
Process Best Practices
Understand how to model a Supply-Chain with SCOR
Understand how to characterize a Supply-Chain with SCOR metrics
Apply the SCOR framework using a simplified SCOR Project Roadmap

3. Supply Chain Operation Reference Model(SCOR): Information about (SCC)
Developed by Supply Chain Council
SCC:Independent , not for profit xorganisation that developed and actively manages the Supply Chain Operations Reference (SCOR) model.
Membership open to all companies and organizations
The SCOR® model is globally recognised as the standard framework that links supply chain process, performance, practices, people (organizations) and technology into a unified structure.

4. Supply Chain Operation Reference Model(SCOR): Information about (SCC)
APICS defines Supply Chain Management as the“planning, organizing, and controlling of supply chain activities.”
Developer and endorser of the Supply Chain Operations Reference (SCOR®) as a cross-industry standard for supply chain management
Offers Training, Certification, Benchmarking, Research, Team Development, Coaching, and Cross-standard Integration focused on the SCOR® framework
Founded in 1996

5. SCOR: A Process Framework
Process frameworks deliver the well-known concepts of business process reengineering, benchmarking, and best practices into a cross-functional framework
Standard processes: Plan, Source, Make, Deliver, Return, Enable
Standard metrics: Perfect Order Fulfillment, Cash-to-Cash Cycle Time, Cost of Goods Sold, Order Fulfillment Cycle Time, etcetera
Standard practices: EDI, CPFR, Cross-Training, Sales & Operations Planning, etcetera
Pre-defined relationships between processes, metrics and practices and inputs and outputs

6. Combines Best Techniques
Business Process Re-Engineering
Benchmarking
Best Practices Analysis
Process Reference Framework
Capture the ‘As-is’ business activity structure and derive the future ‘To-be’ 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 superior performance
Capture the ‘As-is’ business activity structure and derive the future ‘To-be’ 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 superior performance
3 techniques become 1 integrated approach

7. Supply Chain Operation Reference Model(SCOR)
The Primary use of SCOR:
TO describe, measure and evaluate supply chain configuration
Effective Supply Chain Management is when individuals work
together collaboratively to focus on the end customer and provide benefit
to all the links.
SCOR contains:
Standard description of management processes
A framework of relationships among the standard processes
Standard metrics to measure process performance
Management practices that produce best-in-class performance
Enable the companies to:
Evaluate and compare their performances with other companies effectively
Identify and pursue specific competitive advantages
Identify software tools best suited to their specific process requirements

8. SCOR Boundaries SCOR spans: All supplier/customer interaction
Order entry through paid invoice
All Physics material interactions
From your supplier’s supplier to your customer’s customer, including equipment, supplies, spare parts, bulk products, software etc.s
All market interactions
From the understanding of aggregate demand to the fulfillment of each order
Retrurns

9. SCOR Boundaries(cont’d)
SCOR doesn’t include:
Sales and marketing (demand generation)
Research and technology development
Product development
Some elements of postdelivery customer support

10. Supply Chain Operation Refernce Model(SCOR): Basic Management Processes
Supplier
Customer
Suppliers’ Supplier
Source
Internal or External
Your Company
Return
Deliver
Make
Plan
Customers’ Customer
SCOR reference model
Plan-Source-Make-Deliver-Return provide the organizational structure of the SCOR Model

11. Scopes of Basic Management Processes
Plan (Processes that balance aggregate demand and supply to develop a course of action which best meets sourcing, production and delivery requirements)
Balance resources with requirements
Establish/communicate plans for the whole supply chain
Source (Processes that procure goods and services to meet planned or actual demand)
Schedule deliveries (receive, verify, transfer)
Make(Processes that transform product to a finish state to meet planned or actual demand)
Schedule production
Deliver (Processes that provide finished goods and services to meet planned or actual demand, typically including order management , transportation, management and distribution management)
Warehouse management from receiving and picking product to load and ship product
Return (Processes associated with returning or receiving returned products)
Manage Return business rules

12. SCOR Contains Three Levels of Process Detail

13. Performance Measurement
SCC has done in great job in providing level 1 metrics in the SCOR model by which to measure the performance of the overall supply chain.

14. Observations
SCOR describes processes not functions. In other words, the Model focuses on the activity involved, not the person or organizational element that performs the activity.

15. Summary
Business process re-engineering and organizational project management maturity model are tools that can assist a company in putting together a successful project
BPR will help develop rationale for moving from a legacy system to an ERP system
OPM3 will assess the company’s skills and abilities to implement an ERP successfully.
BPM will institutionalize small incremental changes to improve the success of ERP systems

16. Review Questions
What are the steps in business process reengineering?
Why is BPR important in an ERP implementation?
What does the organizational project management maturity model do for a company‘s ERP implementation?
What are the steps involved in OPM3?
What is the role of the project management office in an ERP implementation?
Why is change management critical to the success of a project from the beginning?

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Copyright © 2012 Pearson Education, Inc.  
Publishing as Prentice Hall