scor referencemodel

8/13/2019 SCOR ReferenceModel

1/29

Version 5.0a

August , 2001

Supply Chain Council&

Supply Chain Operations Reference (SCOR)Model Overview

Scott Stephens

Chief Technology Officer

Supply-Chain Council, Inc.

303 Freeport Road

Pittsburgh, PA 15215 USA

www.supply-chain.org


2/29

Version 5.0a

August, 2001 2

Supply Chain Management Changing Times

! Eighteen months ago boom! Central issues

!Revenue Capture!Demand forecast

!Speed! One month ago bust

! Central Issues!Cost!

Inventory! Now Uncertainty! Emerging Issues

!Just-in-case vs. just-in-time!Consumer confidence

! Supply chain management is now a watchword in business, WallStreet, and in the news media


3/29

Version 5.0a

August , 2001

Supply Chain Management&

The Supply Chain Council


4/29

Version 5.0a

August, 2001 4

The SCC is an independent, not-for-profit, global corporation withmembership open to all companies and organizations interested inapplying and advancing state-of-the-art supply chain managementsystems and practices.

Over 700 Company Members

Cross-industry representation

Chapters in Australia/New Zealand, Europe, Japan, Korea,Latin America, and South East Asia with petitions for additionalchapters pending.

Over 30 new members per month

The Supply-Chain Council (SCC) has developed and endorsed theSupply Chain Operations Reference-model (SCOR) as the cross-industry standard for supply chain management

The SCC was organized in 1996 by Pittiglio Rabin Todd & McGrath (PRTM) and AdvancedManufacturing Research (AMR), and initially included 69 voluntary member companies


5/29

Version 5.0a

August, 2001 5

SCC Organization - Chapters and Staffing

SydneyAustralia / New Zealand

Accantia

SydneyAustralia / New Zealand

Accantia

SingaporeSouthEast Asia

Intel

SingaporeSouthEast Asia

Intel

Tokyo, Japan

Hitachi

Tokyo, Japan

Hitachi

Seoul, Korea

Korean Management

Assoc.

Seoul, Korea

Korean Management

Assoc.

Mexico City, Latin America

EXEL

Mexico City, Latin America

EXEL

Pittsburgh, PA

Bayer

Headquarters*Executive Director

Pittsburgh, PA

Bayer

HeadquartersHeadquarters*Executive Director

Amsterdam- Europe

Siemens

Amsterdam- Europe

Siemens

Under Development: Hong Kong, India


6/29

Version 5.0a

August, 2001 6

Membership

! 700+ SCC members,! Compos i t ion

! 40%: Pract i t io ners

! 25%: Enabl ing Techno logy Provid ers

! 20%: Consul tants! 15%: Universi t ies, Associat ion s, Government Organizat ions

S CC Member Compos i tion

P ractitioners

S oftw are V en dors

C on sultants

U niversities/G ov.

O rgs /A ssns .

S CC Members hip by R egion

N orth A m e rica

E urop e

Japan

O the r


7/29

Version 5.0a

August, 2001 7

C-Dennis Zagrodnik Daimler/Chrylser

VC -Paul Welch - Nokia

Current Technical Committee Structure

Integration Committee

Plan Committee

Source Committee

Make Committee

Deliver Committee

Metrics Committee

C-Peter Bolstorff Pragmatek

V-Larry Gray CobreGroup

C-Katie Kaspar -

VC -Oscar ChappelTech Connection C -Ed Biancarelli Washington Group

VC -Irving Briks BellSouth

C -Dan Swartwood Pragmatek

VC - Rick Hughes Lockheed Martin

Intel Siemens

RosettaNet

George Brown INTELHerbert Heinzel - Siemens

C- Major Scott Koster (USMC)

Return Committee


8/29

Version 5.0a

August , 2001

Supply-Chain Operations Reference-model(SCOR) Overview


9/29

Version 5.0a

August, 2001 9

Quantify theoperationalperformance ofsimilar companiesand establishinternal targetsbased on best-in-

class results

Quantify theoperationalperformance ofsimilar companiesand establishinternal targetsbased on best-in-

class results

Benchmarking

Characterize themanagementpractices andsoftware solutionsthat result in best-in-classperformance

Characterize themanagementpractices andsoftware solutionsthat result in best-in-classperformance

Best PracticesAnalysis

Process ReferenceModel

Capture the as-isstate of a process

and derive thedesired to-befuture state

Capture the as-isstate of a processand derive thedesired to-befuture state

Business ProcessReengineering

Capture the as-is stateof a process and derivethe desired to-be futurestate

Quantify the operationalperformance of similarcompanies and establishinternal targets based onbest-in-class results

Characterize themanagementpractices andsoftware solutionsthat result in best-in-class performance

What is a process reference model?

! Process reference models integrate the well-known concepts ofbusiness process reengineering, benchmarking, and processmeasurement into a cross-functional framework


10/29

Version 5.0a

August, 2001 10


11/29

Version 5.0a

August, 2001 11

Supplier

Plan

CustomerCustomersCustomer

Suppliers

Supplier

Make DeliverSource Make DeliverMakeSourceDeliver SourceDeliver

Internal or External Internal or External

Your Company

Source

SCOR is structured around five distinctmanagement processes

SCOR ModelSCOR Model

Return Return ReturnReturn Return Return

Return Return

Building Block Approach

Processes Metrics

Best Practice Technology

Supply Chain Operations Reference model


12/29

Version 5.0a

August, 2001 12

Customers

Su

ppliers

P1 Plan Supply ChainPlanPlan

P2 Plan Source P3 Plan Make P4 Plan Deliver

Source Make Deliver

S1 Source Stocked Products M1 Make-to-Stock

M2 Make-to-Order

M3 Engineer-to-Order

D1 Deliver Stocked Products

D2 Deliver MTO Products

D3 Deliver ETO Products

S2 Source MTO Products

S3 Source ETO Products

Supply-Chain Operations Reference-model(SCOR) 5.0 - Processes

Return

Source

P5 Plan Returns

Return

Deliver

Enable


13/29

Version 5.0a

August, 2001 13

#

Level

Schematic Comments

1

2

3

4

ConfigurationLevel

(ProcessCategories)

ProcessElement Level

(DecomposeProcesses)

Plan

DeliverMakeSource

A companys supply chain can be configured-to-order at Level 2 from approximately 24 core processcategories.

Companies implement their operations strategythrough their unique supply chain configuration.

Companies fine tune their Operations Strategy atLevel 3

Level 3 defines a companys ability to competesuccessfully in its chosen markets and consists of: Process element definitions Process element information inputs and outputs Process performance metrics Best practices, where applicable System capabilities required to support best

practices

ImplementationLevel

(DecomposeProcess

Elements)

Companies implement specific supply chainmanagement practices at this level

Level 4 defines practices to achieve competitiveadvantage and to adapt to changing businessconditions

Su

pplyChainOperationsReference

model

Top Level

(Process Types)

Level 1 defines the scope and content for the SupplyChain Operations Reference model

Here basis of competition performance targets are set

Notin

Scope

Description

Balance Production Resources withProduction Requirements

Establish DetailedProduction Plans

Identify, Prioritize, and AggregateProduction Requirements

Identify, Assess, and AggregateProduction Resources

P3.1

P3.3 P3.4

P3.2

SCOR Contains 3 Levels of Detail

ReturnReturn


14/29

Version 5.0a

August, 2001 14

Mapping material flow

Latin AmericanLatin American

SuppliersSuppliers

(D1)

WarehouseWarehouse

Other SuppliersOther Suppliers(D1)

ManufacturingManufacturing

European SupplierEuropean Supplier(S1)

(SR1,SR3)

Customer

Customer

Customer

Customer

(S1, D1)(SR1,DR1,DR3)

(S1, S2, M1, D1)

(SR1,SR3,DR3)

(D2)

(DR1)

WarehouseWarehouse

WarehouseWarehouse

WarehouseWarehouse

(S1, D1)(SR1,DR1,DR3)

(S1, D1)(SR1,DR1,DR3)

(S1, D1)(SR1,DR1,DR3)

(S1)

(SR1,SR3)

(S1)

(SR1,SR3)

(S1)

(SR1,SR3


15/29

Version 5.0a

August, 2001 15

Mapping the processes

Consumer

P2P2

P4P4

P3P3

P4P4

S1 D1 S1

P2P2

P2P2

P3P3

P4P4

M2S2 D2

M1 D1 S1S2D1

M1

EuropeanRM Supplier

EuropeanRM Supplier

Key OtherRM

Suppliers

Key OtherRM

Suppliers

S1

AlphaRegional

WarehousesRM Suppliers ConsumerALPHA

P1P1

P1P1

P1P1

Li ki S l Ch i P f Att ib t d


16/29

Version 5.0a

August, 2001 16

PerformanceAttribute

Performance Attribute Definition Level 1 Metric

Supply ChainDelivery Reliability

The performance of the supply chain indelivering: the correct product, to the correctplace, at the correct time, in the correct condition

and packaging, in the correct quantity, with thecorrect documentation, to the correct customer.

Delivery Performance

Fill Rates

Perfect Order Fulfillment

Supply ChainResponsiveness

The velocity at which a at which a supply chainprovides products to the customer.

Order Fulfillment Lead Times

Supply ChainFlexibility

The agility of a supply chain in responding tomarketplace changes to gain or maintaincompetitive advantage.

Supply Chain Response Time

Production Flexibility

Supply Chain Costs The costs associated with operating the supplychain.

Cost of Goods Sold

Total Supply Chain ManagementCosts

Value-Added Productivity

Warranty / Returns ProcessingCosts

Supply Chain AssetManagementEfficiency

The effectiveness of an organization in managingassets to support demand satisfaction. Thisincludes the management of all assets: fixed and

working capital.

Cash-to-Cash Cycle Time

Inventory Days of Supply

Asset Turns

Linking Supply Chain Performance Attributes andLevel 1 Metrics

upp y a n car ap na ys s


17/29

Version 5.0a

August, 2001 17

upp y a n car ap na ys sNEW Product Line

50%

$30M Revenue

$30M Indirect Cost

35 days

97 days

0%

63%

Supply Chain SCORcard Performance Versus Comp et i t ive Populat ionOverview Metrics SCOR Level 1 Metrics Actual Parity Advantage Superior Value from Improvements

Delivery Performance to

Commit Date85% 90% 95%

Fill Rates 94% 96% 98%

EXTER

NAL

SupplySupply

ChainChain

ReliabilityReliability

Perfect Order Fulfillment 80% 85% 90%

Order Fulfillment Lead times7 days 5 days 3 days

Flexibility

Responsiveness

Production Flexibility 30 days 25 days 20 days

Total SCM ManagementCost 19% 13% 8% 3%

INTERNAL Cost Warranty Cost NA NA NA NA NA

Value Added Employee

ProductivityNA $156K $306K $460K NA

Inventory Days of Supply 119 days 55 days 38 days 22 days NA

AssetsCash-to-Cash Cycle Time

196 days 80 days 46 days 28 days

Net Asset Turns (Working

Capital)2.2 turns 8 turns 12 turns 19 turns NA

Supply Chain ResponseTime 82 days 55 days 13 days

45 days

$7 M Capital Charge

Key enabler to cost andasset improvements

$30M Revenue


18/29

Version 5.0a

August, 2001 18

S1 D1 S1

M2S2 D2

M1 D1 S1

S2

D1M1

S1

Cycle Time

ScheduleAchievement

Perfect OrderFulfillment

DeliveryPerformance

Supplieron time delivery




On Time

In Full

Docs

Damage

On Time

In Full

Docs

Damage

RevenueAccounts Receivable

Cash Flow

Decomposing Metrics

EuropeanRM Supplier

EuropeanRM Supplier

Key OtherRM

Suppliers

Key OtherRM

Suppliers

ConsumeAlpha

RegionalWarehouses

RM Suppliers ConsumerALPHA


19/29

Version 5.0a

August, 2001 19

Consumer

RMSuppliers

S1 D1 S1

M2S2 D2

M1 D1 S1

S2

D1M1

S1

Cycle Time

ScheduleAchievement


DeliveryPerformance





On Time

In Full

Docs

Damage

On Time

In Full

Docs

Damage

RevenueAccounts Receivable

Cash Flow


Actual - 85%

Perfect OrderFulfillmentGoal 95%

ScheduleAchievementActual 95%


Actual 90%

Delivery

PerformanceActual 99%


Actual 85%

MetricsConflict

Inventory

Under-performance

Process

Systems

Under-performanceProcess

Systems

Performance Measurement

ConsumeAlpha

RegionalWarehouses

RM Suppliers ConsumerALPHA

EuropeanRM Supplier

EuropeanRM Supplier

Key OtherRM

Suppliers

Key OtherRM

Suppliers

SCOR Project Roadmap


20/29

Version 5.0a

August, 2001 20

Material FlowMaterial Flow

SCOR Level 1

OperationsOperations

StrategyStrategy

Analyze Basisof

Competition

SCOR Level 2

Configuresupply chain

AlignPerformance

Levels, Practices,and Systems

Implementsupply chain

Processes andSystems

Implementsupply chain

Processes and

Systems

SCOR Project Roadmap

Competitive Performance RequirementsPerformance MetricsSupply Chain ScorecardScorecard Gap AnalysisProject Plan

AS IS Geographic MapAS IS Thread DiagramDesign SpecificationsTO BE Thread DiagramTO BE Geographic Map

Informationand Work Flow

AS IS Level 2, 3, and 4 MapsDisconnectsDesign SpecificationsTO BE Level 2, 3, and 4 Maps

Develop,Test, andRoll Out

OrganizationTechnologyProcessPeople

SCOR Level 3

SCOR I l t ti


21/29

Version 5.0a

August, 2001 21

SCOR Implementations

! Plan, development, and formation of a company to support a new product line

(Complete)! Re-engineering of supply chain processes for a corporation (138 divisions, 190

countries, 770 sites) (In process)

! Implementation of SCOR processes corporate-wide

! Level 1 Metrics used as executive evaluation criteria

! Re-organization of logistics groups into Plan, Source, Make, Deliver (Complete)

! Multiple organizations

! Collaborative forecasting

! Contracts and purchase orders

Thinking is easy, acting is difficult, and

to put one's thoughts into action is the

most difficult thing in the world. Goethe

SCOR P j t A Wid R f Ad ti


22/29

Version 5.0a

August, 2001 22

SCOR Projects A Wide Range of AdoptionSCOR Projects A Wide Range of Adoption

! Consumer Foods

! Project Time (Start to Finish) 3 months

! Investment - $50,000 US

! 1st Year Return - $4,300,000 US

! Electronics

! Project Time (Start to Finish) 6 months

! Investment - $3-5 Million US

! Projected Return on Investment - $ 230 Million US

! Software and Planning

! SAP bases APO key performance indicators (KPIs) on SCOR Model

! Aerospace and Defense

! SCOR Benchmarking and use of SCOR metrics to specify performancecriteria and provide basis for contracts / purchase orders


23/29

Version 5.0a

August, 2001 23

Supply Chain Council Outreach

! SCOR Workshops (2000)

! Atlanta, January 20-21

! Chandler, AZ (Intel), February 8-9

! Fountainbleu, March 9-10

! Oregon (Intel) March 28-29

! Chicago, April 12-13

! Sydney, May 4-5

! Singapore, June 1-2

! Detroit, June 22-23

! London, July 11-12! Philadelphia (SAP), July 18-19

! Waldorf, Germany (SAP), August 1-2

! Auckland, NZ, August 3-4

! Singapore (SAP), August 8-9

! Chandler, AZ (Intel) August

! Amsterdam, September 28-29

! Tokyo, October 5-6

! Mexico City, October 12-13

! St. Louis, October 26-27

!Sydney, November 6-16 (3 - public, SAP, CHH)

! Hanover, Germany November 9-10

! Oslo, Norway Dec 3-5

!Currently working with Intel to develop an instructor training course


24/29

2000 - 2001 Technical Accomplishments


25/29

Version 5.0a

August, 2001 25

2000 2001 Technical Accomplishments

! Released Version 5.0! Completed Return Processes

! Began updating the Models best practice (e-business)

! Began metrics restructure and glossary update

! (Note of caution to users previous to SCOR 5.0)! Research

! Joint APICS research publication

! Continued support of Penn State / Manugistics Research

! Formation of Research Strategies Advisory Board! Workshop material development and conduct

! 5 versions of workshop developed and delivered Over 500members have attended SCOR Workshops with companies likeIntel, HP, EDS, US Department of Defense, Compaq Baxter, SAP,

hosting in-house Workshops


26/29

Version 5.0a

August, 2001 26

SCOR Model Timeline - 6.0

! After completing Version 5.0 changes committees began workingVersion 6.0 - tentatively scheduled for release in Spring 2002

!Metrics Revision and Decomposition Trees! Return Metrics and Best Practice Complete

! Best Practice and e-Business Improvement

!Collaboration

SCOR Model Directions


27/29

Version 5.0a

August, 2001 27

SCOR Model Directions

! Changes anticipated to shift from structural issues to implementationissues

! Product Development

! Customer/Supplier Relationship Management

! Import / Export! E-business

! Reverse logistics / warranty returns

! Inventory optimization

! Service environment! Synchronizing advanced planning and business planning

! Special Industry Groups / International Chapters

! Finance and metrics

! Benchmarking regional issues

SCC provides the forum - SCOR documents the


28/29

Version 5.0a

August, 2001 28

plearning

! Process Model provides a toolset for rapidly modeling and understanding thesupply chain

!

Metrics provide a toolset for evaluating the supply chain and rapidly identifyinghigh value opportunities

! Best practices and features provide a candidate list of improvement options

! The SCOR Model is the only model of its type that links these elements andprovides a means for assessment of the supply chain outside of the individual

organization! Council members have demonstrated dramatic implementation successes in

virtually every industry in every region of the world.

! The pace and number of SCOR implementations is accelerating and more and

more organizations are adopting SCOR as the framework for their supply chainimprovements.

The Bottom Line -


29/29

Version 5.0a

August, 2001 29

The Bottom Line

! Council members have demonstrated dramatic implementationsuccesses in virtually every industry in every region of the world.

! The pace and number of SCOR implementations is accelerating andmore and more organizations are adopting SCOR as the framework fortheir supply chain improvements.

scor referencemodel

Documents