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Topic 10 IT Enabled Supply Chain Models
Topic 10 IT Enabled Supply Chain Models
Topic 10 IT Enabled Supply Chain Models
Models
Measurement of SCM
performance through Supply
Chain Operations Reference
(SCOR) model
1
Agenda
Foundations
Phase I: Opportunity identification
Phase II: Analyzing basis of
competition
Phase III: Designing Material flow
Phase IV: Implementation
Extending SCOR beyond Supply
Chain
2
Foundations
The roots lie in the Supply Chain council a
non-profit organization www.supply-chain.org
An initiative that had individuals from 69
leading companies (Compaq, Procter &
Gamble, Lockheed Martin, 3M, etc)
Focus: develop a supply chain process model
MISSION: Promote use of the SCOR Model through
development, research, conference events and
application in industry
Foundations
SCOR Model
Foundations
Organizational Support
Requires an Evangelist [Leader]
o Understanding of business domain
o Keen listener
o Can drive incremental as well as radical
change
Assess the
financial
performance
o Top line sales,
etc
o Bottomline
profits
Trousers
T-Shirts
Suits
Peter
England
Shirts
Trousers
T-Shirts
Blazers
Planet
Fashion
Multi Brand
Outlets
Exclusive
Brand Outlets
Factory
Seconds
outlet
External Facing
Internal Facing
Data in each Shareholder
scorecard Facing
Biz Unit I
Biz Unit II
Omit
Omit
Omit
Omit
10
Financial metrics
o Asset turns
o Gross margins
o Return on Assets
11
PRODUCT
Jeans
T-Shirts
Shirts
Jackets
Bags
Ordered
1512
1000
500
250
100
Picked
55
100
47
31
0
Despatche
d
1235
700
412
212
72
Pending
222
200
41
7
28
Order Fill
Rate
82%
70%
82%
85%
72%
13
14
15
16
17
External
Internal
Perf. Metric
OTIF
Supply Chain
Delivery reliability Perfect Order
Requirement
Supply Chain
Responsiveness Cycle time
Supply Chain
Upside SC
flexibility
Flexibility
COGs
96%
Total SCM costs 15.50%
Supply Chain Cost
SG&A costs
7%
Warranty/Return
Costs
0.70%
Cash-to-cash
197
Supply Chain Asset cycle time
Management
Inventory days
Efficiency
of supply
91
Asset turns
2
45 days
3 days
1 day
-31.5
29 days days
27.00%
3.90% -6.00%
10%
69%
9.50%
17%
35%
6.70%
9%
1.50%
1.00%
0.50%
1%
97.9
63.8
29.7
-99
74
2.5
37
4.7
7.0
-18
-1
18
20
Forecast or
replenishment
requirement from PLAN
23
Forecast or
replenishment
requirement
24
Two types
o Returns from customers (DRx)
o Returns to suppliers (SRx)
25
100
80
60
40
20
0
Disconnect
Analysis: Using
Fishbone
Diagram
Cause
Methods
Machinery
Re-design screen
Office Layout
New office
working
method
Training
Teamwork
Materials
Manpower
30
Trading Partner
Organization
Process
People-Jobs
Technology
Goals-Strategy
Design
Replenishment &
Cost & Service
purchasing
Priority
relationship
Competitive
Requirements,
Organizational
i.e. SAP
Structure
Measurement
Service Level
Agreement
Scorecard
Customer
Responsiveness TO BE processes,
[more efficient] leading practices
Defect Analysis
Annual
Performance
Job Scope &
Goals
Responsibilities Performance Appraisal
Screenshot
Technology
Storyline, detailed Uptime, response
Strategy
solution, etc
time
31
33