Today’s Supply Chains are more complexed, demanding, fast-paced, and risk-prone than ever before. The SCOR Model (Supply Chain Operations Reference Model), provides a comprehensive, holistic, and dynamic approach to understanding, measuring, and executing supply chain operations.

The Next Level Purchasing Body of Knowledge underpins, integrates and enhances the essential components of the SCOR Model in simple how to do steps. This cutting-edge BOK is designed by practitioners for practitioners.

The Critical components of SCOR are, the Business Context, the Supply Chain Improvement Portfolio, Plan, Source, Make, Deliver and Return Processes.

business-context Business Context – While the basic framework of the SCOR Model is Plan, Source, Make, Deliver, and Return, these processes lose value if there is ambiguity, lack of purpose, and lack of strategic alignment. The business context or situation focuses on the current performance of organizations relative to the demands and requirements of their customers. This type of focus provides better insight of conformance gaps affecting the critical SCOR processes.

Tools: SWOT Analysis, Benchmarking and Environmental Scanning and Value Stream Mapping are vital tools leveraged in a robust Business Contextual Study.

supply-chain improvement-portfolio

Supply Chain Improvement Portfolio – Continuous improvement of supply chain processes is key to achieving the profound benefits of the SCOR Model. A genuine contextual study would reveal several opportunities for improvement of the Plan, Source, Make, Deliver, and Return processes. Each opportunity should be considered as a project. A set of projects, score-carded, ranked by strategic criteria underpinned by Customer Requirements, is funneled into a Supply Chain Improvement Project Portfolio. Some criteria may be, strategic fit, cost-benefit, impact on customer requirements, and technical feasibility.

Tools: Customer Requirements Matrix, Project Portfolio Matrix, and Project Charter

plan-process

Plan Process – This process entails all core supply chain and procurement dimensions. The primary focus is to meet customer demand in an efficient, cost-effective manner. This requires quantification, and analysis of available resources to meet projected demand with the appropriate quantities at the right time, place, and cost structure. Source, Make, Deliver and Return processes must be effectively planned, organized, lead, and controlled.

Tools: Material Requirements Matrix, Production Schedule, Kanban, Rough-Cut Capacity Planning Matrix, Receiving and Shipping logs, Forecasting Matrix, and Project Charter, Time Study Analysis, Total Productive Maintenance Schedule, Manpower Matrix

Source Process – This process focuses on assuring a consistently reliable, high quality, timely supply of inputs or raw materials to production (Make Processes) and enabling processes. The Key Performance Indicator of a source process is the Total Cost of Ownership of the required production input and enabling materials. Suppliers must be capable, inputs robust, conversion processes capable of high First Pass Yields to deliver great outcomes to customers and key stakeholders.

Tools: Robust Source Process (like NLPA 10 step Global Sourcing Process), Detailed SIPOC Matrix (Suppliers, Inputs, Process, Output, Customers), TCO Matrix, Should Cost Models.

Make Process – This process should be broken into Design and Production dimensions. The design of robust high-quality products and services is essential for companies to maintain competitive advantage and market share.

Design for X is a powerful methodology, where X is considered as the critical variables needed to deliver excellence to customers.

Examples of Design for X are:

  1. Design for Ease of Use
  2. Design for Ease of Manufacture
  3. Design for Ease of Repair
  4. Design for Environmental Safety
  5. Design for Ergonomics
  6. Design for Ease of Shipping and Receiving

Tools: House of Quality Matrix, Kano Model, Stage-Gate Process.

delievery-process

Delivery Process – This process should focus on slim, trim and efficient logistics with the least amount of movement possible to deliver on time value to customers. This process must be monitored for process waste emanating from excess transportation, over-processing, waiting, and motion in the supply chain.

Keep in mind that the typical business supply chain has about 10% Value Add activity, 30% Non-Value Add but Essential activity, and 60% Waste.

Tools: Spaghetti Charts, Waste Audit Matrix, Geographical Maps with Flow

return-process

Return Process – This process should be as efficient as possible because it is a cost driver that does not add value.

Tools: Spaghetti Charts, Waste Audit Matrix, Geographical Maps with Flow

Caveat: Strategic Alignment is critical to business success. The SCOR Model works best when it is strategically aligned to the customer and mission-critical parameters of an organization.

Understand these parameters and you will understand how best to leverage this profoundly robust methodology. Keep it simple!

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David Millington

David Millington M.Sc.QSM, NPDP, CL6σBB, SPPSM, SPSM3®, CM® Director of Education (Next Level Purchasing Association) A Certified Strategic Planning Professional, David Millington brings over 15 years experience in the Strategy Execution, Product / Service Development, Organizational and Supply Chain Excellence Arenas. He is a Certified Supply Chain Professional, Certified New Product Development Professional, Certified Strategic Planning Professional, and a Certified Lean Six Sigma Black Belt. David holds a master’s degree in Quality Systems Management, from The National Graduate School of Quality Management, Falmouth MA, USA. This equips him with mastery of vast bodies of knowledge and best practices. David Millington brings hands-on experience at VP, Director, and Manager Levels, guiding and facilitating the development of strategic and tactical solutions to intricate organizational, product, and service challenges.

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