Using SCOR® to Manage Supply Chain Operations

Many supply chain professionals have heard of or used SCOR® (Supply Chain Operations Reference Model), but with little success due to limited comprehensive understanding about the model. SCOR® is a registered product of APICS Supply Chain Council. This article provides a brief overview of SCOR®.

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About SCOR® – A Process Framework

  • Process frameworks deliver the known concepts of business process reengineering, benchmarking, best practices and organisational design in a cross-functional framework:
    • Standard processes; Plan, Source, Make, Deliver, ..
    • Standard metrics: Perfect Order Fulfillment, Cash-to-Cash Cycle Time, Total Cost to Serve,..
    • Standard practices: EDI, CPFR, S&OP, Cross-Training, ..
    • Standard job skills: Lean, Accounting, Solicitation, ..
  • SCOR® is a unique framework for defining and linking performance metrics, processes, best practices, and people into a unified structure
  • It has pre-defined relationships between metrics, processes, practices and skills
  • SCOR® is used to evaluate and compare supply chain activities and their performance

Processes

  • Plan, Source, Make, Deliver, Return and Enable
  • Process modelling

Performance / Metrics

  • Reliability, Responsiveness, Agility, Cost, Asset management efficiency
  • Scorecards and performance benchmarking

Practices

  • Emerging, Best and Standard
  • Process standardisation and practice benchmarking

Skills

  • Skills, Experience, Training, Aptitudes and Competency levels
  • Organisational design

PROCESSES: SCOR® is organised around six major management processes

  1. Plan: The Plan processes describe the activities associated with developing plans to operate the supply chain. Alignment of resources to demand
  2. Source: The Source processes describe the ordering (or scheduling of deliveries) and receipt of goods and services. Buying or acquiring materials or services
  3. Make: The Make processes describe the activities associated with the conversion of materials or creation of the content for services. Conversion or value-add within supply chain operations
  4. Deliver: The Deliver processes describe the activities associated with the creation, maintenance and fulfilment of customer orders. Customer interaction, from order to final delivery and installation
  5. Return: The Return processes describe the activities associated with the reverse flow of goods. Reverse material/service flow away from customer back through supply chain
  6. Enable: Enable processes describe those processes associated with the management of the supply chain. Management of supply chain risk, relationships, performance & information

METRICS: SCOR®’s Strategic Level metrics measure the effectiveness of the Supply Chain Strategy 

  Strategic Performance Attribute Metric (Strategic)
Customer Facing Supply Chain Reliability Perfect Order Fulfillment
Supply Chain Responsiveness Order Fulfillment Cycle Time
Supply Chain Agility Supply Chain Flexibility
Supply Chain Adaptability
Overall Value at Risk
Internal Facing Supply Chain Cost Management Total Cost to Serve
Supply Chain Asset Management Efficiency Cash-to-Cash Cycle Time
Return on Supply Chain Fixed Assets
Return on Working Capital

PRACTICES: Typically companies aim for Best Practice is which defined as “A current, structured, proven and repeatable method for making a positive impact on desired operational results.”

  • Current: Must not be emerging and cannot be antiquated
  • Structured: Has clearly stated Goal, Scope, Process, and Procedure
  • Proven: Success has been demonstrated in a working environment and can be linked to key metrics
  • Repeatable: The practice has been proven in multiple environments.

SKILLS: SCOR® defines the skills, experiences, aptitudes, training and competency levels required to manage supply chain processes

  • Skill: Capacity to deliver pre-determined results with minimal input of time and energy
  • Experience: The knowledge or skill acquired by observation or active participation
  • Aptitude: A natural, acquired, learned or developed ability to perform a certain kind of work at a certain level.
  • Training: A particular skill or type of behavior learned through instruction over a period of time
  • Competency level: The state or quality of being qualified, having the ability, to perform a specific role.

Using SCOR® to Prioritise Strategic Requirements

SCOR®’s six major management processes (Plan, Source, Make, Deliver, Return and Enable) drive the achievement of supply chain performance targets:

  Strategic Performance Attribute Strategy
Customer Facing Supply Chain Reliability Consistently getting the orders right; product meets quality requirements
  Supply Chain Responsiveness Consistent speed of providing products/services to customers
  Supply Chain Agility Ability to respond to changes in the market (external influences)
Internal Facing Supply Chain Cost Management Cost associated with managing and operating the supply chain
  Supply Chain Asset Management Efficiency Ability to efficiently utilise the supply chain’s assets in support of fulfilment

Sharyn Grant previously managed the Supply Chain Council Australia and New Zealand (ANZ) Chapter for two years, after one year on the ANZ Chapter Leadership Team. Sharyn has used SCOR® for 15 years, is SCOR-P certified.

(Source: An adaptation of information from SCOR®, APICS Supply Chain Council)