Develop an End-to-End

Process Architecture

Strategic Supply Chain Management

Supply Chain Architecture

• Without a proper layout, you won’t be

able to envision how the many pieces
fit together within the existing
infrastructure to form an integrated
whole

• In supply chain management, that

design/layout is your supply chain
architecture.
Supply Chain Architecture

• Your supply chain architecture details

the process, applications, and
information needed to improve and
evolve your supply chain.

• Companies with supply chain

architectures in sync with their
business goals have better overall
business performance
Four Components of Supply
Chain Architecture
◆ A description of all supply chain
processes (plan, source, make,
deliver, and return) and how they
relate to each other

◆ A view of the interactions between the

supply chain processes and other
core enterprise processes
Four Components of Supply
Chain Architecture
◆ A description of the applications
required to support supply chain
processes, including the data and
performance indicators needed for
process execution and control

◆ A description of how the applications

will be integrated, including specific
data and frequency of
communications
Four Components of Supply
Chain Architecture
Process Architecture
Supply Chain Architecture

• How to ensure that your supply chain

architecture is correct / affective ?

• Four test of SC architecture:

1) The test of Strategic Fit
2) The test of End to End Focus
3) The Simplicity test
4) The Integrity test
Strategic Fit
• Supply chain strategy must drive the
choices you make in your supply
chain architecture

• It’s important before deciding how you

want to operate to think critically
about why you need to operate a
certain way
Strategic Fit

• Avoid the trap of choosing costly

leading-edge practices that provide
only marginal support
Strategic Fit

Your architecture has met the test of

strategic fit when:

1)The value of new practices is

quantified before they are integrated
into the supply chain architecture

2)New business practices are prioritized

based on their ability to drive forward
the supply chain strategy.

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Strategic Fit

Your architecture has met the test of

strategic fit when:

3) The supply chain architecture is

reviewed regularly to ensure
alignment with current strategic
direction

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End-to-End Focus

• End-to-end focus identifies integration,

both internal and external

• It can create value for the company as

a whole

• Integration, means shared goals and

alignment of the processes, systems,
and organizations needed to achieve
those goals.
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End-to-End Focus

• Without shared objectives, it doesn’t

make sense to invest in end-to-end
processes

• When a supply chain architecture

meets the test of end-to-end focus?

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End-to-End Focus

1)
Processes and supporting information
systems are integrated within and beyond
the enterprise—reaching key suppliers and
customers.

2)
Supply chain resources such as capacity
and inventory are optimized across the
organization and with key suppliers and
customers
End-to-End Focus
3)
Standard metrics and quantitative
objectives are shared across the
organization and with key suppliers and
customers.

4)
Performance visibility and management are
shared across the organization and with
key suppliers and customers.
End-to-End Focus

Particulars Internal Integration External Integration

1) Process &
supporting √ √
information system

2) Supply Chain
resourses √ √
3) Standard metrics
and quantitative √ √
objectives
4) Performance
visibility and √ √
management
The Simplicity test

• External integration increases the

risks of complexity.

• In this scenario, each process, data

element, and system must be clearly
defined and agreed to
The Simplicity test

Four Complexity drivers to be avoided:

◆ Supply chain configuration

◆ Product and service proliferation
◆ Process and information systems
inconsistency
◆ Overautomation
The Simplicity test
◆ Supply chain configuration:
-Too many locations, factories, warehouses, operations
nods etc
-Trying to manage too many customer and supplier
relationships directly?

◆ Product and service proliferation:

-An ever-increasing number of products and services?

-This means more items to plan, source, make, and

deliver—all of which drive supply chain costs and
inventory
The Simplicity test
◆ Process and information systems
inconsistency:

Different locations have different processes and

systems, the company loses speed and efficiency
and added additional investment costs...

◆ Overautomation:

Overautomated processes are difficult to manage

because the people who use them don’t completely
understand how they work
The Integrity test

• The best supply chains have an

integrated flow of information.

• Integrity in the form of integrated

applications, accurate data, and
documented processes
The Integrity test

Test of Integrity:

-Integration should be defined in Architecture

-All processes are documented at each level of

architecture

- Data quality is measured and managed