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DCOR 2.

0 Framework Update

Next release of the Design Chain


Operational Reference-model
(DCOR)

John Nyere
Special Assistant for Supply Chain Systems,
ODUSD (Business Transformation)

May 13, 2009


This presentation is the exclusive property of the Supply
Chain Council. Copyright © Supply Chain Council. 2009. All
rights reserved. The marks SCOR®, CCOR™, DCOR™ and
SCOR Roadmap™ are the exclusive property of the Supply
Chain Council.
Today’s Agenda

•  DCOR History
•  Teams
•  Macro Differences – last release and proposed
release
•  Design Chain definition and importance
•  DCOR overview
•  Where it fits
•  Execution Elements
•  Amend
•  Planning
•  Enable
•  Metrics
•  Recap and Questions
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DCOR Update History
•  2006 : SCC releases DCOR release 1.0.
This includes best practices , revamped
metrics and a 3rd Amend process- Specification Change.
•  Sep 2008 : started revision of DCOR release 2.0.
Goal: Bring DCOR model to same level of maturity as SCOR
•  Proposed 2.0 at TDSC in October
•  Teams Reviewed and Revised
•  16 April to 10 May – Cleanup and Publish “Preview”
•  “Preview” Release 13 May at Convergence Forum in Atlanta
•  Post 13 May - Review issues, complete consolidations
•  Formal approval and release, then package for publication

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Teams

•  Research – HP
•  Design – PRTM, ValuePlus (Taiwan)
•  Integrate –Cisco
•  Amend – USAF, BearingPoint
•  Planning – SCC
•  Metrics – IBM China
•  Best Practices – PTC
•  Risk Management – IBM (D,Morrow)
•  Model Hosting/support - EiiSolutions
•  Lead - DoD

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DCOR 2.O Differences – the Macro

So what is new and different?


1.  Revised to conform to look and feel of SCOR 9
2.  Seven new process elements – 5 Risk Management, 2 Integrate
3.  New Metric Trees from L1 to L3
4.  More Metrics –
DCOR 1.0 DCOR 2
Cost * 117 219
Responsiveness * 69 208
Agility 10 345
Asset Management 11 161
Reliability 5 201
5.  Best Practices: 270 373 New and proposed
6.  Inputs/Outputs 115 495 SCOR 9 aligned
7.  Best Practice index
8.  KPI Indices

* Aligned to refresh, new product and new technology –


widely different cycle-times/risks/costs 5
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Design Chain Importance
•  When you are producing or repairing product in the supply chain,
where do Specifications come from?
•  When you Engineer-To-Order products, or for that matter Make
to Stock or Order, where do BOMs, routings, work instructions,
procedures, product documentation, etc come from?
•  Where does product data come from? What can I specify as a
deliverable if I am a customer with various sustainment
strategies?
•  When the product fails, where do you go to fix it.
•  When you are a customer, and put in your “requirements.” how
and when do you know they are being achieved? e.g. reliability,
cost, sustainment, maintainability, reliability, all the “Design
For’s” …..
•  How do you revise an existing product, develop new products
and acquire new technology/materials/vendors?
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Design Chain

•  The collection of processes that translate ideas for


products into product definitions –such as recipes,
BOMs, work instructions, workflow– and develops or re-
uses the processes and infrastructure for selling,
fulfillment and support of the product.
•  Is where we:
•  refresh products,
•  design new products and procedures,
•  obtain new technologies/materials/sources
•  address non-conforming, fallout, deficient products and change
our specifications/requirements
•  manage our product development portfolio
•  Develop and maintain our product data over the product lifecycle
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Design Chain

Product/Portfolio Management
Product/Portfolio (PPM)
Management

Customer processes
Supplier processes

Product Design Sales & Support


DCOR™ CCOR™

Supply Chain
SCOR ®

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Design Chain Processes

Design ChainChain
Supply Processes

“Customer”
processes

Plan

Customer processes
Supplier processes
“Supplier”

Research Design Integrate

processes
Amend

Process, arrow indicates design materials flow direction

Process, no design materials flow Information flow

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A designer and manufacturer of complex products

Design Chain Processes Supply Chain Processes

Plan Plan

Customer
Research Design Integrate Source Make Deliver

Amend Return

Operations
VP VP VP Product
New Product Manufacturing Sustainment
Development
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End-to-End

"Supplier" "Component" "Product"

hard drive co. storage

flash drive co. human interface mp3 player

hard and flash co. mp3 technology

online music store

internal labs. web technology


research design integrate research design integrate research design integrate

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DCOR: Another Process Framework

•  Process frameworks integrate the well-known


concepts of business process reengineering,
benchmarking, and process measurement into a
cross-functional framework
•  Standard processes:
Plan, Research, Design, Integrate, Amend
•  Standard metrics:
Perfect Design, Design Chain Cycle Time, Design Chain Cost, etc
•  Standard practices
Collaborative design, Stage gate reviews, etc

•  Pre-defined relationships between processes,


metrics and practices
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DCOR Hierarchy
Level 1 Level 2 Level 3 Level 4 Level 5
Scope Configuration Activity Workflow Transactions

R1 EDI
Design Chain R1.2
Research
Research
Source Materials XML
Product Refresh

Differentiates Differentiates Names Tasks Sequences Links


Business Complexity Steps Transactions
Defines Scope Differentiates Links, Metrics, Job Details Details of
Capabilities Tasks and Automation
Practices

Framework Framework Framework Industry or Technology


Language Language Language Company Specific
Specific Language
Language

Standard DCOR definitions Company/Industry definitions


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Execution Processes

•  DCOR recognizes three mainstream execution processes:


Research, Design and Integrate. These processes source,
integrate and distribute product definitions, procedures and
methods, and rules throughout the company

Plan

Research Design Integrate

Amend

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Research (Level 1)

•  Objective:
•  Finding, testing and approving sources of materials, knowledge and
technology for products or services. This includes collecting and
archiving specifications of parts, obtaining (new) manufacturing, delivery
and/or sales techniques, and identification and verification of (sub-)
contractors.

•  Keywords:
•  Technology/knowledge/product trends
•  Supplier identification
•  Supplier and component verification
•  Documentation of form/fit/function

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Capability Models – Level 2

Level: Different capabilities – need different measurements

Product Refresh (R1, D1, I1)


•  Plan driven
•  Minor changes to the product
•  Short turn-around times (now discretely measured and costed)

New Product (R2, D2, I2)


•  Market driven
•  Significant change in product (line)
•  Longer turn-around times (now discretely measured and costed)

New Technology (R3, D3, I3)


•  Market and technology driven
•  Significant change to product and
production processes
•  Strategic change, long lead-times (now discretely measured and costed)

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Research (Level 3) – No Change
Product Refresh (R1) New Product (R2) New Technology (R3)

R2.1 Receive and R3.1 Receive and


Validate Request Validate Request
R3.2 Identify Sources for
Technology
R1.1 Schedule Research R2.2 Schedule Research R3.3 Schedule Research
Activities Activities Activities
R1.2 Source Materials R2.3 Source Materials R3.4 Source Materials/
Technology
R3.5 Establish
Verification Process
R1.3 Verify Materials R2.4 Verify Materials R3.6 Verify Materials/
Technology
R1.4 Transfer Findings/ R2.5 Transfer Findings/ R3.7 Transfer Findings/
Materials Materials Materials
R1.5 Authorize Supplier R2.6 Authorize Supplier R3.8 Authorize Supplier
Payment Payment Payment 17 17
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Design (Level 1)

•  Objectives:
•  Decomposition of the (new) product requirements
and design of the product or service. This includes developing
and testing prototypes.

•  Keywords:
•  Prototypes ('laboratory' environment)
•  Technical drawings/Specifications
•  Form, fit and function
•  Product/service costing
•  Manufacturing process design
•  Supply chain process design
•  Service and support process design 18
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Design (Level 2)

•  Design Product Refresh (D1)


•  Plan-driven scheduled update of an existing product or service.
The existing product specifications are refreshed, no significant
redesign activities.
•  Design New Product (D2)
•  The grounds-up or significant redesign of a product or service.
The product or service is build on an existing technology
•  Design New Technology (D3)
•  Design new technology. This includes technology that is new to
your company. Technology includes techniques for
manufacturing or services delivery.

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Design (Level 3)

Product Refresh (D1) New Product (D2) New Technology (D3)


D2.1 Receive Validate and D3.1 Receive Validate and
Decompose Decompose
D1.1 Schedule Design D2.2 Schedule Design D3.2 Schedule Design
Activities Activities Activities
D3.3 Acquire Knowledge

D1.2 Design and D2.3 Design and D3.4 Design and


Validate Validate Validate
D1.3 Build and Test D2.4 Build and Test D3.5 Build and Test
Prototype Prototype Prototype
D1.4 Package Design D2.5 Package Design D3.6 Package Design

D1.5 Release Design to D2.6 Release Design to D3.7 Release Design to


Integrate Integrate Integrate
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Integrate (Level 1)

•  Objective:
•  Preparing the company for new or changed product. This includes
distributing the information, such as contracts, work-instructions,
business rules and goals, throughout the company: supply-chain, sales,
service and support.

•  Keywords:
•  Pilot builds ('production' environment),
•  Readiness (company operations),
•  Product transition,
•  Product roll-out and migration plans

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Integrate (Level 2)

•  Integrate Product Refresh (I1)


•  Replace an existing product. Examples: minor revision of a car (new
model year), upgrade of standard specs of consumer products such as
appliances, electronics and personal computers

•  Integrate New Product (I2)


•  The roll-out of a new product. Significant change in workflow,
instructions, bills-of-materials/recipes. Normally not a significant change
in production and/or test equipment.

•  Integrate New Technology (I3)


•  Launching new products which contain or require new technology. A
significant change in production and testing equipment, training and
change in procedures.

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Integrate (Level 3) – changes
Product Refresh (I1) New Product (I2) New Technology (I3)
I1.1 Receive & Validate I2.1 Receive & Validate I3.1 Receive & Validate
Request Request Request

I1.2 Decompose Request I2.2 Decompose Request I3.2 Decompose Request

I2.3 Distribute I3.3 Distribute


Requirements Requirements

I1.3 Obtain & Validate I2.4 Receive & Validate I3.4 Receive & Validate
Design Design Design

I1.4 Establish Execution I2.5 Establish Execution I3.5 Establish Execution


Processes Processes Processes

I1.5 Pilot Design I2.6 Pilot Design I3.6 Pilot Design

I1.6 Package Product I2.7 Package Product I3.7 Package Product

I1.7 Release Product I2.8 Release Product I3.8 Release Product 23


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Control processes: Plan, Enable

•  Enable plan and enable processes prepare the design


chain to ensure smooth execution
•  Planning processes balance the need for resources,
materials, lab availability, etc. and the availability of these
resources. This includes prioritization when needed.
•  Enable processes address 9 or 10 control aspects for the
design chain. They monitor compliance, integrate
information from other process areas
and highlight dependencies on these
other process areas

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Plan Process Elements – New Names

Plan Design Chain Plan Research (PR) Plan Design (PD) Plan Integrate (PI) Plan Amend (PA)
(PP)

PP.1 Gather Design PR.1 Gather P3.1 Gather PI.1 Gather PA.1 Gather
Chain Research Design Integrate Amend
Requirements Requirements Requirements Requirements Requirements

PP.2 Gather PR.2 Gather P3.2 Gather PI.2 Gather PA.2 Gather
Design Chain Research Design Integrate Amend
Resources Resources Resources Resources Resources

PP.3 Balance PR.3 Balance P3.3 Balance PI.3 Balance PA.3 Balance
Resources with Resources with Resources with Resources with Resources with
Design Chain Research Design Integration Amend
Requirements Requirements Requirements Requirements Requirements

PP.4 Establish PR.4 Establish P3.4 Establish PI.4 Establish PA.4 Establish
Design Chain Research Design Integration Amend
Plan Plan Plan Plan Plan

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Enable Processes
•  Objective:
The Enable processes are five groups of processes under Plan,
Research, Design, Integrate and Amend with 3 distinct types of
objectives:
1.  Manage process performance
2.  Manage process control data
5.  Manage process relationships

•  Key processes comprehended:


•  Managing business rules and monitoring adherence
•  Measuring design chain performance and determine corrective action
•  Managing supplier and service provider relationships
•  Managing the design chain network and facilities

•  Hint: Documentation management? Probably Enable


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Enable Process Elements

Integrate
Research

Amend
Design
Plan
Manage Business Rules EP.1 ER.1 ED.1 EI.1 EA.1
Manage Process Performance EP.2 ER.2 ED.2 EI.2 EA.2
Manage Process Information EP.3 ER.3 ED.3 EI.3 EA.3
Manage Product Life Cycle EP.4 ER.4 ED.4 EI.4 EA.4
Manage Design-Chain Capital Assets EP.5 ER.5 ED.5 EI.5 EA.5
Manage Knowledge Transfer EP.6 ER.6 ED.6 EI.6 EA.6
Manage Process Network EP.7 ER.7 ED.7 EI.7 EA.7
Manage Process Regulatory Compliance EP.8 ER.8 ED.8 EI.8 EA.8

Manage Risk EP.9 ER.9 ED.9 EI.9 EA.9

Manage Financial Plan Alignment


EP.10 ED.10
Manage Intellectual Property 27
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Reverse Flow: Amend

•  Objective of this process:


•  Resolving design issues and supporting design adaptations.
•  Example Amend Types:
•  Product cannot be manufactured or fulfilled (A1)
•  Vendor disappeared (earthquake, bankruptcy)
•  Component availability (single vs. dual sourcing)
•  Dimensions not supported (too heavy, too tall)
•  Product does not perform according to specifications (A2)
•  Product 'quality' issues
•  Repair volume increased observed
•  Recalls result from the Amend process
•  Product specification changes to support orders
•  Engineer-to-order orders (e.g. planes, trucks)
•  Pharma, CPG, Systems Engineering (change to Requirement)
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Amend Process Elements

Product Fall Out (A1) Deficient Product (A2) Product Specs (A3)

A2.1 Obtain Deficiency A2.1 Obtain Specification


Information (ECR) Information*
A1.1 Receive & Validate A2.2 Validate Issue A2.2 Validate Issue
Issue (ECR)
A1.2 Decompose Issue (ECN) A2.3 Decompose Issue (ECN) A2.3 Decompose Issue (SCN)

A1.3 Distribute Issue & ECO A2.4 Distribute Issue & ECO A2.4 Distribute Issue & SCO

A1.4 Publish Advisory (ECN) A2.5 Publish Advisory (ECN) A2.5 Publish Advisory (SCN)

* Could be an SCR, ECP, ECR, or other trigger…

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Performance Attributes

Attribute Strategy
Reliability Consistently getting the right product AND process
design, meeting quality requirements and on-time
completion of integration

Responsiveness The consistent speed of designing and integrating


new products/services

Agility The ability to respond to unplanned events


(incl. external influences and quality issues)

Cost The cost associated with managing and operating


the design chain

Assets The effectiveness in managing the design chain’s


assets in support of design and integration of new
products
Question: What are the most important attributes for your design chain?
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DCOR KPIs; Strategic Metrics

Attribute Strategic Metric


Reliability Perfect Product Design

Responsiveness Design Chain Cycle Time

Agility Product Design Chain Change Cycle Time

Cost Total Design Chain Cost or Cost of Goods in Design

Assets Design Chain Fixed Assets Value

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DCOR Performance Attributes
Performance Attribute: a characteristic to describe a strategy. The
following metric trees are in the model.
DCOR Performance Attributes
Design Chain Agility
AG.1.1 Upside Design Chain Flexibility
AG.1.2 Upside Design Chain Adaptability
AG.1.3 Downside Design Chain Adaptability
AG.1.4. Product Design Change Cycle Time
Design Chain Asset Management
AM.1.1 Design Chain Fixed Assets Value
AM.1.2 Return on Design Chain Fixed Assets
AM.1.3 Return on Working Capital
Design Chain Costs
CO.1.1 Total Design Chain Management Costs
CO.1.2 Cost of Goods in Design
Design Chain Reliability
RL.1.1 Perfect Product Design
Design Chain Responsiveness
RS.1.1 Design Chain Cycle Time
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Strategic Cost Metric

Metric: Total Design Chain Cost


Definition: The costs associated with operating the design chain.
Calculation: Sum of the cost to plan, research, design, integrate and
amend. These are all costs associated with managing the
design chain. (People, facilities, materials, etc.)
L2 Metrics: •  Plan Cost
(sample) •  Research cost
•  Design cost
•  Integrate cost
•  Amend cost

Notes: Compare: R&D Cost on the 10-K for public companies

Will probably go away as its corollary in the Supply Chain


(Total Supply Chain Management Cost)
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Or Strategic Cost Metric
Metric: Cost of Goods in Design
Definition: The costs associated with products in Design
A corollary to COGS.
Calculation: The value of the R&D Portfolio of products in
development. Hence the calculation would be:
Portfolio value (cost of new products in development) at
beginning of the year/period +net purchases +cost of labor+
materials and supplies+ other costs - value of products
launched at the end of the year/period
= Cost of Goods in Design
L2 Metrics: •  Plan Cost
(sample) •  Research cost
•  Design cost
•  Integrate cost
•  Amend cost

Notes: Compare: R&D Cost on the 10-K for public companies


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Strategic Reliability Metric

Metric: Perfect Product Design


Definition: The ability of the design chain to deliver product designs
which meet the following standards: on-time, right product,
complete documentation, supply-chain ready, product testing
and certification complete
Calculation: [Total perfect designs]/[Total designs] x 100%
Perfect design = on-time request * certifications complete *
documentation complete * manufacturing readiness and risk
assessment complete * more..
L2 Metrics: •  % On-time to commit
(sample) •  # of design errors
•  Documentation complete
•  Perfect Integration
Notes: Perfect design is the product of lower level metrics
For each design the value is either 0 or 100%
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Strategic Responsiveness Metric

Metric: Design Chain Cycle Time


Definition: The average speed at which a design chain generates
product designs.
Calculation: [Sum of actual cycle times for all completed designs]/
[Total number of completed designs]
Actual cycle time = time between receipt of design
requirements and release of the product design to operations
L2 Metrics: •  Research cycle time
(sample) •  Design cycle time
•  Integrate cycle time
Notes: Consider the cycle time targets for
different products and different
technology life cycle phases

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Strategic Agility Metric

Metric: Product Design Change Cycle Time


Definition: Time to change a product design after it has been released to
operations.
Calculation: [Sum of Amend cycle times]/[Total number of events]
Amend cycle time = time between receipt of ECO
requirements and release of the revised design to operations
L2 Metrics: •  Pilot build time
(sample) •  Amend cycle time
•  Re-plan frequency RECA
LL
Notes: Typical scenarios:
•  Supplier bankruptcy
•  Product recalls
The product has previously been released to operations

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Strategic Asset Metric

Metric: Design Chain Fixed Assets Value


Definition: The total value of all design chain assets
Calculation: Sum of Plan, Research, Design, Integrate and Amend fixed
asset values
L2 Metrics: •  Plan Fixed Assets Value
(sample)
•  Research Fixed Assets Value
•  Design Fixed Assets Value
•  Research Fixed Assets Value
•  Integrate Fixed Assets Value
•  Amend Fixed Assets Value

Notes: Check Ex.5 Manage Fixed Asset processes

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Recap: DCOR Background

•  Originally developed by Hewlett-Packard


•  Adopted by Supply-Chain Council
•  First SCC release refined or added metrics, best practices and
A3 Amend product specifications process

•  DCOR is founded on the SCOR framework architecture:


•  Input, process, output, planning and control
•  3 pre-defined levels
•  Integrated metrics, processes and best practices

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Recap: Process Framework

•  Process Framework components and benefits:


•  Processes defined
•  Metrics defined
•  Best practices identified
•  And relationships between these pre-defined

•  What it is not:
•  A pre-defined map of your company
•  A must-have list of metrics
•  A must-have list of practices

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Recap: Key DCOR Processes

•  Planning and control processes:


•  Plan Design Chain; Drive overall plan and budget
•  Plan Research, Plan Design, Plan Integrate, Plan Amend
•  Enable; Align resources and monitor performance

•  Execution processes:
•  Research; Collecting knowledge and parts
•  Design; Technical engineering and documentation
•  Integrate; Prepare and release to operations

•  Reverse processes:
•  Amend; Correct research, design or integration flaws and
addressed changes to orders/requirements/specs
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Recap: Process Configuration

•  Categories:
•  Product Refresh; Existing products, small change
•  New product; Existing technology, change to product
•  New Technology; New processes, significant change

•  Behaviors:
•  Life Cycle status of product determines which category
•  Different categories are measured differently
•  New technology products is partially new product and
partially product refresh
•  New product is partially product refresh

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Recap: Key DCOR Metrics

•  Metric Types
•  Reliability; Perfect Product Design
•  Responsiveness; Design Chain Cycle Time
•  Flexibility; Product Design Change Cycle Time
•  Cost; Total Design Chain Cost
•  Assets; Total Design Chain Fixed asset Value

•  Metrics and levels;


•  Set the scope using level 1 (strategic) metrics
•  Drill down to the root cause
•  Different process configurations make different
measurements
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Model Is Available For Review

•  http://scc-aris.eiisolutions.net:8080/businesspublisher/

•  Userid: Guest Password: DCOR4U

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• www.supply-chain.org
• www.scorlabs.org
For follow-up questions about the DCOR™ Model or the
Supply Chain Council and its Products or Services:

jfrancis@supply-chain.org
For follow-up questions specific to the content and
discussions of this Workshop:

John.Nyere@osd.mil
703 693 1685

This presentation is the exclusive property of the Supply


Chain Council. Copyright © Supply Chain Council. 2009. All
rights reserved. The marks SCOR®, CCOR™, DCOR™ and
SCOR Roadmap™ are the exclusive property of the Supply
Chain Council.
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