SCOR®10.0 for Supply Chain Optimization

SCOR® Walkthrough 10.0
Supply-Chain Operations Reference-model

John PAUL
© 2011 Copyright iCognitive Pte. Ltd. All rights reserved

Professor & Research Fellow at BEM (Bordeaux Ecole de Management-France)
Qualified SCOR® Instructor by Supply Chain Council
Managing Director, iCognitive

PLAN SOURCE MAKE DELIVER RETURN


SUPPLY CHAIN COUNCIL
OVERVIEW

2

Supply Chain Council Overview
An independent, non-profit global association
• The SCC is an independent, not-for-profit, trade association
• Membership open to all companies and organizations
• Focus is on research, application and advancement and advancing state-of-the-art
supply chain management systems and practices
• 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
• Approaching 1000 Association Members
• Chapters in North America, Europe, Japan, South Africa, Latin America, Australia/New
Zealand, South East Asia and Greater China, with developing Chapters India and
Middle East

Driving value through the use of SCOR®

3

Supply Chain Council Overview
SCOR Model available in English and Chinese

On sale on: http://alturl.com/mqzzp
www.supply-chain.org www.icognitive.com

4


SCOR OVERVIEW VERSION 10.0

5

SCOR® Introduction
Six distinct management processes
structure SCOR®

Building Block Approach
Processes Metrics
Best Practice Technology

6

SCOR® Introduction
SCOR®: A process reference model
Business Process Best Practices Process Reference
Reengineering Benchmarking Analysis Model

Capture the “as-is” Capture the “as-is” state of a
state of a process and process and derive the
derive the desired desired “to-be” future state
“to-be” future state Quantify the
operational
performance of Quantify the operational
similar companies performance of similar
and establish internal companies and establish
targets based on internal targets based on
“best-in-class” results

“best-in-class” results
Characterize the
management Characterize the
practices and management practices
software solutions and software solutions
that result in “best-in- that result in “best-in-
class” performance class” performance

7

SCOR® Introduction
SCOR® contains three levels of details

SCOR is a
Top-Down
Process

8

SCOR® Introduction
Supply-Chain Operations Reference-model (SCOR)
10.0 – Processes [1/2]
Plan P1 Plan Supply Chain

P2 Plan Source P3 Plan Make P4 Plan Deliver P5 Plan Returns

Source Make Deliver
S1 Source Stocked Products M1 Make-to-Stock D1 Deliver Stocked Products
Suppliers

S2 Source MTO Products M2 Make-to-Order D2 Deliver MTO Products

Customers
S3 Source ETO Products M3 Engineer-to-Order D3 Deliver ETO Products

D4 Deliver Retail Products

SR1 Source Return Defective Product DR1 Deliver Return Defective Product

SR2 Source Return MRO Product DR2 Deliver Return MRO Product

SR3 Source Return Excess Product DR3 Deliver Return Excess Product

Enable
9

SCOR® Introduction
Supply-Chain Operations Reference-model (SCOR)
10.0 – Processes [2/2]
Plan P1 Plan Supply Chain

P2 Plan Source P3 Plan Make P4 Plan Deliver P5 Plan Returns

Level 1
Source Make Deliver
processes
and
S1 Source Stocked Products M1 Make-to-Stock D1 Deliver Stocked Products
Level 2
variations
S2 Source MTO Products M2 Make-to-Order D2 Deliver MTO Products

S3 Source ETO Products M3 Engineer-to-Order D3 Deliver ETO Products

D4 Deliver Retail Products

D2.7 D2.6 D2.5 D2.4 D2.3 D2.2
D2.1
Level 3 Select Carriers & Route Plan & Build Consolidate Reserve Resources Receive,
Sub Rate Shipments Shipments Loads Orders & Configure, Enter &
Process Inquiry
processes of Determine Validate Order
& Quote
Delivery Date
D2

D2.8 D2.9 D2.10 D2.11 D2.12 D2.13 D2.14 D2.15
Receive Product Pick Product Pack Product Load Product Ship Product Receive & Install Invoice
from Source or & Generate Verify Product Product
Make Shipping Docs by Customer

10

SCOR® Introduction

Using latest Version 10.0
• Structure
– Section1: Introduction
– Section 2: Metrics
– Section 3: Processes
• Chapter 3.1: Plan and Workflow Graphics
• Chapter 3.2: Source and Workflow Graphics
• Chapter 3.3: Make and Workflow Graphics
• Chapter 3.4: Deliver and Workflow Graphics
• Chapter 3.5: Return and Workflow Graphics

• Chapter 3.6: Inputs and Outputs
– Section 4: Best Practices
• SCOR
• Green SCOR
• Risk Management
– Section 5: People
– Section 6: Special applications
• Green SCOR

11

SCOR® Introduction

Version 10.0 – Using Metrics Coding
• Metrics Coding
XX.y.z
XX= Performance Attribute. The possible values for XX are:
• RL= Reliability
• RS= Responsiveness
• AG= Agility
• CO= Cost

• AM= Asset Management

y= Level of the metric

z= a unique number

12

SCOR® Introduction

Planning Processes

Customer
Customer processes
Supply Chain
Supplier processes
Supplier
Supply
Plan

Chain
Source Make Deliver

Return Return

13

SCOR® Introduction
PLAN – Balancing requirements and resources
• Plan provides two important functions
within the SCOR Model
– Plan processes provide the mechanism for balancing
demand requirements and available resources
Plan – Plan processes provide an integrating function
between other process elements and suppliers /
customers
• Includes elements such as:
– Prioritizing demand requirements

– Planning inventory, distribution, production,
material, and rough-cut capacity for all products and
The balancing of all channels
requirements – Supply chain configuration, long-term capacity and
against resources resource planning, business planning, product
phase-in/phase-out, manufacturing ramp-up, end-
of-life management, product-line management
– Manage planning infrastructure

14

SCOR® Introduction

Execution Processes

Customer
Supply Chain

Customer processes
Supplier processes
Supplier
Supply
Plan

Chain
Source Make Deliver

Return
Return Return
Return

15

SCOR® Introduction
SOURCE – Ordering and receipt of goods
• Source processes document the activities
that connect an organization to its suppliers
• Source Processes include activities such as:
Source – Material Acquisition
• Obtain, receive, inspect, hold, and
issue material
– Vendor certification and feedback, sourcing quality,
in bound freight, vendor contracts, initiate vendor

payments
– Raw Materials Warehouse management
Activities that connect – Raw Materials Transportation
us to our suppliers • Manage traffic
• Manage inbound freight
– Manage Source business rules
– Manage RM inventories

16

SCOR® Introduction
MAKE – Conversion of materials
• Make documents the processes that transform /
converts raw materials into finished goods
– Make processes do not imply a change of location but a
qualitative transformation of the raw materials
– Not all organizations will necessarily perform Make
Make processes
• Make processes include activities such as:
– Request and receive material from Source processes
– Manufacture and test product, package, hold and/or

release product
– Engineering changes, facilities and equipment, production
Change to status, production quality, shop scheduling/sequencing,
form, fit, or short-term capacity
– WIP Transportation
function – Manage production business rules
– Manage WIP inventories

17

SCOR® Introduction
DELIVER – Fulfillment of customer orders
• Deliver processes document the activities that connect an
organization to its customers
• Deliver processes include activities such as:
– Order management
• Enter and maintain orders
• Generate quotations
Deliver • Create and maintain customer database, maintain
product/price database
• Manage accounts receivable, credits, collections and
invoicing
– Finished Goods Warehouse management
• Store, pick, pack and configure products, create customer

specific packaging/labeling, consolidate orders, ship
Activities that products
connect us to our • Finished Goods Transportation and installation management
– Manage traffic, manage outbound freight, manage Schedule
customers installation activities, perform installation, verify performance
• Manage channel business rules, order rules, manage deliver
inventories, manage deliver quality. Manage product
import/export

18

SCOR® Introduction
RETURN – Reverse flow of goods
• Return processes document the activities
associated with the handling of returns, that
is, the return of a product to a supplier or
the receipt of a returned product from a
Return customer

• Return Source
– Activities associated with returning material to a
supplier including the communication with the

trading partner, the generation of documentation,
and the physical return / shipment of product.
How to manage
returns from your • Return Deliver
customers and – Activities associated with receiving and disposing of
returned material from a customer including the
to your suppliers communication with the trading partner, the
generation of documentation, and the physical
return / receipt and disposal of product.

19

SCOR® Introduction
SCOR links Company Strategy to Business Operations

Strategic Europe
an RM
Supplie
S2 M2 D2

S2
r
M1 D1 S1 D1 S1
DR1 SR1
DR1 SR1 DR1 SR1

DR3 SR3
S1

Key S1 M1 D1
Other

RM

Tactical Supplie
rs RM
Supplie
ALPHA
Alpha
Regional
Warehou
Cons
umer
rs ses

Operational

Systems

20

SUPPLY CHAIN PERFORMANCE

Supply Chain Competitive Analysis - Measuring
Performance Metrics

21
21

Supply Chain Performance
Measuring how well the supply chain performs is as
essential as understanding how it operates

• Measurements must link to business
objectives
• Measurements must provide insights into how
to manage the supply chain more effectively

• Measurements must be appropriate for the
process activity they are measuring
– Same level

22

Supply Chain Performance

Eleven Level 1 metrics
Performance Attributes
Level 1 Strategic Metrics Customer-Facing Internal-Facing
Reliability Responsiveness Agility Costs Assets

Perfect Order Fulfillment √
Order Fulfillment Cycle Time √
Upside Supply Chain Flexibility √
Upside Supply Chain Adaptability √
Downside Supply Chain Adaptability √

Overall Supply Chain Value-At-Risk √
Supply Chain Management Cost √
Cost of Goods Sold √
Cash-To-Cash Cycle Time √
Return on Supply Chain Fixed Assets √
Return on Working Capital √

23


GREEN SCOR
SCOR BEST PRACTICES

24
24

Best Practices - Green SCOR

An Excellent Foundation for
Environmental Accounting
• Sustainable business models and
environmental accounting are growing
business concerns.
• There are multiple approaches to measuring
the total environmental footprint of an

organization or supply chain with no agreed
upon standards.
• SCOR provides an excellent foundation for
environmental accounting in the supply chain.
25

Best Practices - Green SCOR
Green metrics Aggregation along SCOR process structure

Total Carbon Footprint
Level 1
Air + Liquid + Solid - % Recycle = Total Environmental
Footprint
Tier 3 Tier 2 Tier1 Your Customer
S2 M2 D2 S2 M2 D2 Company
Level 2 D1 S2 M2 D2 D2

S1 M1 D1 S1 M1 D1 Carbon
Air
Liquid

Solid
% Recyc
M2.1 M2.2 M2.3 M2.4 M2.5 M2.6 M2.7

Schedule Issue Produce and Package Stage Release Waste
Level 3 production Product Test Product Product to Disposal
Activities Deliver
Carbon Carbon Carbon Carbon Carbon Carbon Carbon
Air Air Air Air Air Air Air
Liquid Liquid Liquid Liquid Liquid Liquid Liquid
Solid Solid Solid Solid Solid Solid Solid
% Recyc % Recyc % Recyc % Recyc % Recyc % Recyc % Recyc

26


SCOR BEST PRACTICES
RISK MANAGEMENT

27
27

Best Practices – Risk Management
Supply Chain Risk Management (SCRM)

• SCRM
– The systematic identification, assessment and mitigation of
potential disruptions in logistics networks with the
objective to reduce their negative impact on the supply
chain network’s performance.

• Related SCOR Processes
– EP.9, ES.9, EM.9, ED.9, ER.9

28

Example of Typical Supply Chain Risks

29


Three phase approach for SCRM
Phase 1: Phase 2: Phase 3:
Risks identification Risks assessment Risks mitigation

Supply risks Risks assessment & Control and monitor
evaluation
Operations risks
Risks strategy Mitigation measures
management selection

Demand risks

Security risks Decreasing the
Risks plan definition
impact
Other risks
(regulations,
environmental, Decreasing the
etc…) likehood

30


SCOR Enables Risk Monitoring
Delivery Performance 12

100%
10

80%8

60%6

40%4

20%2

0 0
Fournisseur Fournisseur Fournisseur Fournisseur Fournisseur Fournisseur Fournisseur Fournisseur Fournisseur Fournisseur
Chine Singapore Europe du Europe de Europe Afrique de Afrique de Amerique du Amerique Amerique du
Nord l'Est Occidentale l'Ouest l'Est Nord centrale Sud

Suppliers
© 2008 Copyright – iCognitive Pte, Ltd . Tous droits réservés

Example of Supplier Risk Monitoring

31

WHAT IS NEW IN V10.0?
SCM SKILLS AND CAPABILITIES -
PEOPLE

32
32

People
Introduction to Supply Chain Management Skills in SCOR
Supply Chain Architecture Overview

People Section
Skills • Experience • Aptitude • Training • Competency

33

People
Supply Chain Assets – Human Capital
Key elements of the People section

Skill Experience Aptitude Training Competency
• Capacity to • The knowledge • A natural, • A particular skill • The state or
deliver pre- or skill acquired acquired, or type of quality of being
determined by observation learned or behavior qualified, having
results with or active developed learned through the ability, to
minimal input of participation ability to instruction over perform a
time and energy • i.e. Cycle perform a a period of time specific role

• i.e. Master Counting, Cross certain kind of • i.e. SCOR-S • 5 Levels: Novice,
Scheduling, Docking, and work at a certification, Beginner,
Import/Export Hazardous certain level. APICS CPIM Competent,
Regulations, Materials • i.e. Accuracy, certification but Proficient,
Production Handling Analytical, also include on- Expert
Planning, Risk Natural the-job training
Mitigation etc leadership etc etc.

34

Full presentation with more details about SCOR
V10.0 is available on:
http://www.icognitive.com/index.php?option
=com_phocadownload&view=category&id=6
%3A&download=107%3Ascor_v10_sc_optimiz

ation&Itemid=64&lang=en

iCognitive Downloads: http://alturl.com/878ek

35


Thank you
For more information please
contact us at
info@icognitive.com or
+65 6325 2810
www.icognitive.com

iCognitive, an Expert in Supply Chain Management

CONSULTING BENCHMARKING

RESEARCH IN
SUPPLY CHAIN

TRAINING TECHNOLOGY

37

With Hands-On Experience in SCOR

Supply Chain Excellence Award - With support
of iCognitive, British American Tobacco Pakistan
SCOR implementation project won two awards
from Supply Chain Council:
•Supply Chain Operational Excellence Award
•Global Award for Supply Chain Excellence

Provider of SCOR® workshops as
qualified SCOR® instructor certified by
the supply chain council : more than
2000 supply chain professionals trained
in more than 200 companies.

38

SCOR®10.0 for Supply Chain Optimization

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