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Business Process Re-Engineering Best Practice Implementation
Business Process Re-Engineering Best Practice Implementation
Optimization Objectives
Analyzing business processes currently supported by the System with a proven Supply Chain Methodology Understanding SAP Functionality Gaps in supporting business processes Determine the operating level of the Purchase to Pay business process Develop recommendations for functional gap mitigation/resolution Re-engineer business processes with Best Practices moving organization to next sustainable level Optimizing SAP System functionality with configuration changes and enhancements Develop recommendations on project implementation, including staffing requirements and cost
Supply Chain Operations Reference (SCOR) Model Structured around Five Distinct Management Processes
Plan
Deliver Return
Source Return
Make
Deliver Return
Source Return
Make
Deliver Return
Source Return
Make
Deliver Return
Source Return
Supplier
Internal or External
Organization
Customer
Internal or External
Customers Customer
SCOR Model
Building Block Approach Processes Best Practice Metrics Technology
Characterize the Characterize management the management practices and practices and software solutions software in bestthat resultsolutions that result in-class in bestin-class performance performance
Suppliers
Source
S1 Source Stocked Products
Make
M1 Make-to-Stock
Deliver
D2 Deliver MTO Products
M2 Make-to-Order
M3 Engineer-to-Order
Return Source
SR1- Return Defective Product SR2- Return MRO Product SR3- Return Excess Product
Return Deliver
DR1- Return Defective Product DR2- Return MRO Product DR3- Return Excess Product
Enable
Customers
Source
Processes that procure goods and services to meet planned or actual demand. Processes that transform product to a finished state to meet planned or actual demand.
Make
Deliver
Processes that provide finished goods and services to meet planned or actual demand, typically including order management, transportation management, and distribution management. Processes that handle the return of materials to suppliers and receipt of goods from customers, including defective products, MRO products and excess products . Processes that prepare, maintain or manage information or relationships on which planning and execution processes rely
Return
Enable
Metrics
Best Practices
Tech Enablers
SCOR Spans:
All supplier / customer interactions
Order entry through paid invoice
Returns
Comments
Level 1 defines the scope and content for the Supply Chain Operations Reference model Here basis of competition performance targets are set A companys supply chain can be configured-toorder at Level 2 from approximately30 core process categories. Companies implement their operations strategy through their unique supply chain configuration. Level 3 defines a companys ability to compete successfully 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 Companies fine tune their Operations Strategy at Level 3
1 Top Level (Process Types) 2 Configuration Level (Process Categories) 3 Process Element Level
(Decompose Processes)
P3.1 Identify, Prioritize, and Aggregate Production Requirements
Source
Make
Deliver
Return
Return
Not in Scope
Implementation Level
(Decompose Process Elements)
Companies implement specific supply chain management practices at this level Level 4 defines practices to achieve competitive advantage and to adapt to changing business conditions
Execution
Enable
P1.2 Identify, Assess, and Aggregate SupplyChain Resources (P2.4) Sourcing Plans (P3.4) Product MAKE Plans (P4.4) Delivery Plans (EP.3) Planning Data (EP.5, EP.6) Projected Internal and External Production Capacity (EP.5, EP.6) Revised Capital Plan (EP.5, EP.6) Outsource Plan (EP.8) Regulatory Requirements (Customer) Inventory
S1.2
S1.3
Receive Product
Verify Product
Receipt Verification (ES.1, ES.2, Procurement Signal (Supplier) ES.6 ES.8) Sourced Product on Order (P2.2), (ES.9) Scheduled Receipts (M1.1, M2.1, M3.2, D1.8, D4.2) (M) (D) Product Pull Signals (ES.4) Product Inventory Location (EM) WIP Inventory Location (ED) Finished Goods Inventory Location
S1.4
S1.5 Authorize Supplier payment Inventory Availability (P2.2, ES.4, M1.2, M2.2, M3.3, D1.8, D4.2) Daily Replenishment Requirements (D4.1) Loaded Cart (D4.4)
Transfer Product
Inventory Availability (P3.2) Information Feedback (M1.1) Replenishment Signal (S1.1, S2.1, S3.3) Product Location Information (EM.6)
M1.4
M1.6 Release Product to Deliver Information Feedback (M1.1) Finished Product Release (D1.8, D4.2)
Package
D1.6
D1.4
Route Shipments
Consolidate Orders
Scheduled Deliveries (P) (S1.1) Scheduled Receipts (S1.4) Inventory Availability (M1.1) Production Schedule (M1.6) Product Release (SR2.2) Authorization to Scrap (SR2.2) Authorization to Return to Service
Load Information (P4.2) Daily Shipment Plan and Build Loads Volume Information (SR2.4)
Order Backlog (P1.1, P4.1) Validated Order Inventory Availability/ Delivery Optional Payment Date (P4.2) Replenishment Signal (S1.1)
D1.8
From Make or Source
D1.9
D1.12
Receive Product
Pick Product
Install Product
Payment
Deliver Return
Ship To Data Return Policy Warranty Claim Return Policy Product Recall Notice Fault Isolation
SR1.6
DR1.4
DR1.1
Authorize Return
Disposition Record
Receipt Transaction
Return Shipment
Analyze
- Identification and documentation of SAP functionality gaps - Infrastructure assessment - Develop implementation alternatives & validate - Develop high level project plan (timing, resources)
Present Findings
- Present Findings, & Implementation Strategy - Next Steps
Prepare
Week 2
Week 3
Week 4
Week 5
Week 6
Findings Workshop
Level 1
Process Type
Process Type
Process Type
Level 2
Process Category
Process Category
Process Category
Level 3
Process Element
Process Element
Process Element
Level 4
Level 5
Work Activity
Work Activity
Work Activity
Key Activities Identify Business Scope Business Group Products Distribution Channels Locations Key Objective: Use SCOR and business scope to define which level 1 processes are in scope. Defines the basis for level 2 scope Level 1 Scope Utilize SCOR to identify Level 1 scoping Level 2 Scope
Return
DELIVERABLE: Level 1 Scope by Product/Supply Chain Variation within Specific Business Business/Product Product A Product B Product C P S M D RD RS
MAKE
M1 Make-to-Stock M2 Make-to-Order M3 Engineer-toOrder
DELIVER
D1 Deliver Stocked Product D2 Deliver Make-to-Order Product SR2 Return MRO Product D3 Deliver Engineer-to-Order Product SR3 Return Excess Product D4 Deliver Retail Product
RETURN (SOURCE)
SR1 Return Defective Product
RETURN (DELIVER)
DR1 Return Defective Product DR2 Return MRO Product DR3 Return Excess Product
Key Objective: Use SCOR, business scope and Level 1 scope to define which level 2s are relevant to business/product.
DELIVERABLE: Level 2 Scope by Business/Product Group Source Business/ Product Product A Product B S1 S2 S3 M1 Make M2 M3 D1 Deliver D2 D3 D4
Level 1: Plan Supply Chain Level 2: Plan/Plan, Plan Source, Plan Make, Plan Deliver
Plan /Plan
PP.1
Level 3
PP.2
PP.3
PP.4
Level 4
P1.1.0
Communicate Goals & Targets Requirements
P1.1.2
Gather Forecast Input Data w/o Constraints
P1.1.3
Statistically Generate Requirements Forecast
P1.1.4
Analyze, Calculate Forecast Independent, Dependent Demand
P1.1.5
P1.1.6
P1.1.7
Adjust Requirements (unconstrained)
P1.1.8
Publish Demand Plan (unconstrained)
Level 1: Plan Supply Chain Level 2: Plan/Plan, Plan Source, Plan Make, Plan Deliver
Plan /Plan
PP.1
Level 3
PP.2
PP.3
PP.4
Level 4
P1.1.0
Communicate Goals & Targets Requirements
P1.1.2
Gather Forecast Input Data w/o Constraints
P1.1.3
Statistically Generate Requirements Forecast
P1.1.4
Analyze, Calculate Forecast Independent, Dependent Demand
P1.1.5
P1.1.6
P1.1.7
Adjust Requirements (unconstrained)
P1.1.8
Publish Demand Plan (unconstrained)
Customer-Facing
Internal-Facing
Flexibility Cost Assets
Responsiveness
SCOR Level 1
Material Flow
AS IS Geographic Map AS IS Thread Diagram Design Specifications TO BE Thread Diagram TO BE Geographic Map
SCOR Level 2
SCOR Level 3
Implement Implement supply chain supply chain Processes and Processes and Systems Systems
Day
Wednesday
Time
9:00 9:30
Description
Recap BPM To Be process issues recorded differences and gaps Best Practice Exercise List HP best practices List number of SCOR best practices covered Break To be model refinement Mix teams/attempt to merge to 1 model Lunch Report on adjusted to be model Break Open Issues in to be model development Next Steps in to be development
Presenter
John Carreau, Connie Fuentes Dave Dresner
9:30 10:00
Team
1:30 2:15 2:15 3:00 3:00 3:15 3:15 4:00 4:00 - 4:45
11:30 12:30 12:30 1:30 2:30 2:45 2:45 3:45 3:45 4:30
4:45 5:00
Wrap Up Day 1
Facilitator
4:30 5:00
Wrap Up Day 2
Facilitator
Day
Tuesday
Time
9:00 9:30 9:30 9:45
Description
DP Example in EMEA BPM To Be process SCOR Framework Review as is in common framework Discuss method for inventing to be Break out: 3 Groups: 2 commercial,1Consumer Use Common process steps to model to be Invent process steps where needed Lunch Report Outs (2 Rpts, 1 hour each) Discuss where Best Practice is included How known issues are dealt with Test with Scenarios that break the model Break Report Outs (cont.) Model Differences
Presenter
JP Walsh John Carreau, Connie Fuentes Dave Dresner
9:45 11:30
Team
4:30 5:00
Wrap Up Day 2
Facilitator
P2 P2
P3 P3 P4 P4
P3 P3 P2 P2 P4 P4
P2 P2 P4 P4
S2
M2
D2
S1
M1
S2 D1 S1
M1
D1
S1
D1
S1
RM Suppliers
Company
Customers
P1 P1
P1.1 P1.2 P1.3 P1.4
P1 P1
P2 P2
P2.1 P2.2 P2.3 P2.4
P3 P3
P3.1 P3.2 P3.3 P3.4
P4 P4 P2 P2
P3 P3
P2.1 P2.2 P2.3 P2.4 P3.1 P3.2 P3.3 P3.4
P4 P4
P4.1 P4.2 P4.3 P4.4
P2 P2
P2.1 P2.2 P2.3 P2.4
P4 P4
P4.1 P4.2 P4.3 P4.4
S2
M2
D2 S2
M1
D1
S1
D1
S1
S1
M1 D1 S1
M2.1 M2.2 M2.3 M2.4 M2.5 M2.6 M1.1 M1.2 M1.3 M1.4 M1.5 M1.6 D1.1 D1.2 D1.3 D1.4 D1.5 D1.6 D1.7 D1.8 D1.9 D1.10 D1.11 D1.12 D1.13 D2.1 D2.2 D2.3 D2.4 D2.5 D2.6 D2.7 D2.8 D2.9 D2.10 D2.11 D2.12 S1.1 S1.2 S1.3 S1.4 S1.5 S2.1 S2.2 S2.3 S2.4 S2.5 M1.1 M1.2 M1.3 M1.4 M1.5 M1.6 D1.1 D1.2 D1.3 D1.4 D1.5 D1.6 D1.7 D1.8 D1.9 D1.10 D1.11 D1.12 D1.13 D1.1 D1.2 D1.3 D1.4 D1.5 D1.6 D1.7 D1.8 D1.9 D1.10 D1.11 D1.12 D1.13
S2.1 S2.2 S2.3 S2.4 S2.5 S1.1 S1.2 S1.3 S1.4 S1.5
RM Suppliers
Level 2
Regional Warehouses
Customers