application of the scor model i - rolf g. poluha

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An explanation of the SCOR model.

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  • Application of theSCOR Model in

    Supply ChainManagement

    Rolf G. Poluha

    Amherst, New York

  • Copyright 2007 Rolf G. Poluha

    All rights reserved Printed in the United States of America No part of this publication may be reproduced, stored in orintroduced intoa retrieval system, or transmitted, in anyform, or by any means (electronic,mechanical,photocopying, recording, or otherwise), without thepriorpermission of the publisher. Requests for permissionshould be directed topermissions@cambriapress.com, ormailed to Permissions, Cambria Press, PO Box 350,Youngstown, New York 14174-0350.

    This book has been registered with the Library of Congress.

    Poluha, Rolf G. Application of the SCOR model in supply chainmanagement / Rolf G. Poluha. p. cm. Includes bibliographical references and index. ISBN 978-1-934043-23-3 (alk. paper) 1. Business logisticsManagement.I. Title.

    HD38.5.P65 2007 658.7dc222007012289

  • For my wife, Sandra, mychildren, Kim, Dion and

    Tia,and my parents,Edeltraud and Alfred

  • IV. Foreword Dr. Poluha presents himself with thecomplex task of examining the mostcommonly known reference model forthe Supply Chains of organizations,namely the SCOR model (Supply ChainsOperations Reference Model) by theSupply-Chain Council (SCC), within theframework of an empirical examinationof its value for Supply Chain analyses inand for the purpose of practicalapplications.

    In recent years, the SCOR modelhas achieved ever-growing importance,most importantly in the North Americanfield of business, but also increasingly in

  • Asia and Europe. The origins and aimsof the model are just as comprehensivelydiscussed as its strengths andweaknesses. In addition to this,impressive examples of application frombusiness practices are also represented.It is surprising that hardly any scientificstudies are available with reference tothe model and its application. In actualfact, its reference to realization and itsefficiency are simply taken to be a givenquantity.

    Dr. Poluhas work wishes toaccomplish an exploratory contributionto the scientific examination of themodel. For this purpose, roughly 80empirically gained sets of data from

  • companies in Europe, North Americaand Asia are evaluated and interpretedby means of statistics. The analysis isperformed by means of specialperformance indicators, which form abasis for the structure of the model, andare discussed in detail.

    During the statistical evaluation, themethod of procedure orientates itselfupon a sequence, which is logicallyproduced and incorporates statistically-descriptive descriptions, inferencial-statistical evaluations, interpretativeattempts at the explanation of non-confirmed results, as well ascomprehensive thoughts upon anaggregated level. In addition to this, an

  • attempt is made to submit the model toexamination by means of a procedure forstructural analysis.

    A concrete example of a theory-based empirical research project issuggested as a topic of possible andsubsequent research. Hypothesesrepresent the basis for deliberations,which are founded upon model-specificperformance indicators and are deducedfrom a distinctly and clearly organizeddepiction of the SCOR model.

    Conclusions to the model aredrawn and potentials for improvementare extricated by the comparison ofwork-theses and results of the empiricalexamination. Innovative initiatives for

  • the configuration and possibilities forutilization of the SCOR model arepresented and consequently discussed.The restrictions of the presentlyavailable SCOR model are elaborated,wherein a central role is played by themissing dimensions of the configurationof organization and human resources.

    The work offers an exploratory andinterim result towards the scientificresearch into the SCOR model and itsapplication. The author has benefitedfrom his extensive experience in theconsultation practice, and his ability tocall upon the use of relevant data andmaterial. Continuous studies can expandupon the results and are urgently needed

  • in order to scrutinize and extend theaccumulated knowledge, as well as tothrow light upon any outcome of thefindings that may appear inconclusive. Inthis manner, success can be achieved ingenerating incentives for themaintenance and further development ofthe SCOR model.

    Prof. Dr. Dietrich SeibtUniversity of Cologne, Cologne,

    Germany, April 2007

  • V. Preface This book is designed to provide anoverview of the SCOR model in itspresent form, as well as the operationalpossibilities for analysis andmeasurement of the performancepotential of Supply Chains. Subsequentto this, the examination design and theresults of an empirical study areintroduced, which were designed tomake the structure of the SCOR modeloperational, and to subject it to a testwith regards to its solidity andproximity to truth.2

    In roughly the last ten years, themeaning of logistic processes in

  • companies has strongly increased.Whilst before, logistics stillpredominantly represented a verticalcompany function, the functionalencroachment and integrated view of asupply chain have stepped into theforeground. This reflects itself, forexample, in the creation of a newpolitical economic discipline, SupplyChain Management, and the increasinganchoring of this discipline withincompanies.

    The work at hand moves the SupplyChain into the focal point. For thepurpose of structuring the related SupplyChain Processes, the so-called SupplyChain Operations Reference Model

  • (SCOR) model is utilized and thoroughlyreflected upon with regards to thepossibilities pertaining to its explanationand description. The selected researchgoals can be summarized as follows:

    According to investigationconducted by the author, noacademic studies have as yet beenperformed to specifically analyzethe SCOR model structure;The SCOR model structure ispresumed to be correct and themodel is being used for applicationin projects, or for subsequentstudies;The model is increasinglypopular and used in practice,

  • primarily in North America andAsia, with Europe still laggingbehind;There is an assumption ofcorrectness simply because it isapplied. However, there is noobjective external assessment forthe validity of the model or itsinternal measures;This leaves the models user atsome risk that despite wide use, themodel itself may be, at leastpartially, incorrect.

    Due to the represented situation, the

    book tries to find answers to thefollowing research questions (scientific

  • motivation):

    How could the consistency, i.e.,assumed alignment of the modelsperformance measurements, betested?How could the SCOR model bemade operational for statisticalanalysis?What would be the implications ofinconsistency (i.e., lack ofassumed alignment of the modelsperformance measurements)?Is inconsistency a SCORproblem, or one that it inherits andbrings into clearer view due to itsframework?

  • The author by no means claims to

    perform a generally valid and finalexamination of the SCOR model. It isobvious that such a goal would gobeyond the scope of a single and initialresearch effort, if it would be possible atall. The intention is rather to perform anexploratory contribution to research, anexploratory attempt to gain initial andconsequently provisional resultsconcerning the questions and researchgoals listed above, and furthermore, toinitiate and support subsequent researchthat can build upon those results.

  • VI. Acknowledgements The work at hand has been created in thecontext of an in-service dissertationproject over a period of time, primarilybetween 2001 and 2005, at theDepartment of Information Systems andInformation Management at theUniversity of Cologne, Germany by Prof.Dr. Dietrich Seibt, who is presentlyleading the Research Department forInformation Systems and LearningProcesses. Since then, the content hasbeen continuously updated andcomprises the status quo of practicalknowledge and academic research as atthe beginning of 2007.

  • As the author, I have been workingas a consultant and project manager withBearing Point (formerly KPMGConsulting) and SAP AG on projects inEurope and the United States during thecreation of this work. In the course ofthese projects, I had ample opportunityto acquire intensive and extendedinsights into the topics of Supply ChainManagement and SCOR. The resultingexperiences are reflected in the work inmany ways.

    Special thanks for the initiation,development and execution of the workare due to my doctoral advisor, Prof. Dr.Dietrich Seibt. He literally took andfulfilled the role and acted as a real

  • advisor. In this sense, he always gaveme the appropriate and necessaryimpulses at the right time with hissuggestions, encouragement andconstructive criticism.

    The second opinion was kindlyadopted by Prof. Dr. Detlef Schoder,director of the Seminar for InformationSystems and Information Management atthe University of Cologne. The chair ofthe debate was Prof. Dr. UlrichThonemann, director of the Seminar forSupply Chain Management andManagement Science at the University ofCologne.

    Further thanks go to Prof. RichardWelke, director of the Center for

  • Process Innovation at J. Mack RobinsonCollege of Business at the Georgia StateUniversity. Based on his experienceswith normative models in general, andthe SCOR model in particular, heprovided me with helpful references andsuggestions, which have beenincorporated into the work.

    I would also like to thank thelibraries of the University of Stuttgart,Germany, North Carolina StateUniversity, Georgia Institute ofTechnology, and Georgia StateUniversity. They have granted megenerous access to their archive