Supply Chain Operations Reference Model (SCOR) SCOR Brief Overview.
How Do I Use SCOR? - Any2Any Technologies, Ltd to... · How Do I Use SCOR? Supply Chain World -...
Transcript of How Do I Use SCOR? - Any2Any Technologies, Ltd to... · How Do I Use SCOR? Supply Chain World -...
How Do I Use SCOR?Supply Chain World Supply Chain World -- April, 2001April, 2001
Peter Bolstorff [email protected] Consulting Group, Ltd.www.pragmatek.com
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Supplier
Plan
Customer Customer’sCustomer
Suppliers’Supplier
Make DeliverSource Make DeliverMakeSourceDeliver SourceDeliver
Internal or External Internal or External
Your Company
Source
What is Supply Chain?
Supply Chain Operations Reference Model
The integrated processes of Plan, Source, Make and Deliver, spanning your suppliers’ supplier to your customers’ customer, aligned with Operational Strategy, Material, Work & Information Flows.
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Material Flow
Operations StrategyAnalyze
Basis of Competition
ConfigureSupply Chain
AlignPerformance
Levels, Practices,
and Systems
AlignPerformance
Levels, Practices,
and Systems
ImplementSupply-Chain
Changes
ImplementSupply-Chain
Changes
SCOR Project Roadmap•Supply Chain Scope•Performance Metrics•Supply Chain SCORcard•Competitive Performance Requirements•SCORcard Gap Analysis•Business Case
•AS IS Geographic Map•Disconnects & ROI•Design Specifications•TO BE Geographic Map •AS IS Process Flow •TO BE Process Flow
Informationand Work Flow
•AS IS Work/Information Map•Disconnects•Design Specifications•TO BE Work/Information Map•Prioritized List of Changes
Implementation •Master Schedule of Projects•Detail Design•Technology Selection•Pilot•Roll Out
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Project Approach
Analyze Basis of Competition
Configure Supply Chain
Implement Supply Chain Changes
3-4 Months 6+ Months1-2 Weeks
Discover Analyze Design Develop Implement
OpportunityOpportunity StrategyStrategy SolutionSolution PrototypePrototype InstallInstall
Align Performance Levels, Practices &
Systems
SCOR Project Roadmap
Educate
SupportSupport
1 Week
• Workshops• Executive
Briefings• Customized
Training
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Educate for Support
WHO
– The Evangelist– Core Team Buy IN– Active Executive
Sponsorship
WHAT
– General SCOR Workshops
– Customized SCOR Workshops
– Executive Briefing
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Discover Opportunity
Business Team
!Value Proposition!Profit & Loss Statement!Balance Sheet!Critical Success Factors!Critical Business Issues! Internal Profile!External Profile
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Discover Opportunity
PerformanceIssues
!Deficiency! Improvement!Core Competency
Investment
Goals, Design, &Management
!Organization! Process!Technology! Jobs/People
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Discover DeliverableProject Charter
I. Introduction!Maintenance of the Project
Charter
II. Project Overview!Scope!Business Objectives!Project Objectives
III. Project Approach!Methodology!Project Schedule!Project Milestones &
Deliverables!Dependencies
IV. Project Budget
V. Project Organization!Organization Chart!Project Resources!Roles and Responsibilities
VI. Measures of Success!Stakeholder Expectations!Benchmarks!Benefit Analysis 8
VII. Project Communication!Communication Plan!Control Procedures
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PRAGMATEK SMEPRAGMATEK SME
CLIENT Advisory/Steering CommitteeCLIENT Advisory/Steering Committee
PRAGMATEK Project ManagerPRAGMATEK Project ManagerCLIENT Project ManagerCLIENT Project Manager
PRAGMATEK Extended TeamPRAGMATEK Extended Team CLIENT Extended TeamCLIENT Extended TeamCLIENT Design TeamCLIENT Design Team
CLIENT Project SponsorCLIENT Project Sponsor
Discover DeliverableProject Organization
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Discover DeliverableProject Plan
3/20 5/1 6/1 7/1 8/1 9/1 +
Supply Chain Design/PilotRoll OutQuick Hit Changes
Roll Out Non-Technical Changes
Bus
ines
s
Technology Assessment/ Optimization
FunctionalRequirements
ConferenceRoom Pilot
Roll Out Integrated Solution
Tech
nica
l
Analyze Design Develop Implement
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Analyze
Drive a Tight Supply Chain Scope
Benchmark Defines Business Opportunity
Supply Chain SCORcard “Hot Links” to the P&L
Business Management Team Ownership
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Analyze DeliverableSCORcard
Cust
omer
Fac
ing
Inte
rnal
Facin
g
Actual SCORcard
SCOR Level 1 Metric Actual Parity Advantage Superior Value from Improvements
Order Fillrate98% 76% 87% 97%
Need To Maintain Superior Performance
Delivery Reliability
Line Fillrate N/A 90% 96% 98+% N/A
Flexibility & Responsiveness
Fulfillment Leadtime, (Order Receipt to Customer Receipt)
5 - 12 days 3 days 2 days 1 day Opportunity for Competi tive Advantage
COGS, (Cost of Sales % to Net Sales)
34.7% 60.0% TBD TBD Need To Maintain Superior Performance
Warranty/Returns, (Returns as % of Net Sales)
16.0% TBD TBD TBDOpportunity for
Performance Improvem ent
CostTotal Supply Chain Cost, (As a % of Net Sales)
----- 8.0% 7.0% 5.0%Opportunity for SG&A
Reduction
Order Management, (Customer Service A llocat ion + Freight +
Fulf illment )8.5% 4.0% 3.0% 1.5% $2.5M estimated Home
Delivery opportunity
Material Acquisition Very Low 3.0% 2.0% 0.5% Need To Maintain Superior Performance
AssetsCash to-Cash, (Inventory days of supply + days sales outstanding - average payment period)
7 days 65 days 40 days 20 days Need To Maintain Superior Performance
Net Asset Turns, (Total gross product revenue/Total net assets)
TBD 2.5 5 7 TBD
Actual Performance Versus Consumer Packaged Goods Benchmarks
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Analyze DeliverableCompetitive Performance Requirements
" Superior
Legend
# Advantage $ Parity
Delivery Reliability
Flexibility/ Responsiveness
Cost
Asset
Performance Attribute
MATURE NEW
Performance vs.
Competition
"
$#$"
$# $
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DesignMaterial Flow
Geographic Map– Physical Locations– Product ID, SKU, and/or Family
Disconnects– Drive the ROI– Prioritize the Work
SCOR Level 2 defines types of processes used by physical location– “Lean Manufacturing” concepts
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DesignMaterial Flow Deliverable
M anu fac tu rin g
Dis tr ibu to r
O E M S u pp lie r
W arehouse
C ust om e rDis tr ibu to r
Dis tr ibu to r
Dis tr ibu to r
W arehouse
W arehouse
W arehouse
C ust om e r
C ust om e r
C ust om e r
Texa s Su pp lie r
(S2, M2, D2)
(S1, D1) (S1, D1)
(S2, M1, D1)
(D2)
(S1)
(S1, M1, D1)
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DesignMaterial Flow Deliverable
1 = Forecasting
2 = Competitive Part Material Flow
3 = Non-working Inventory
4 = Inbound Freight
5 = Reorder Point
6 = Schedule Agreements
7 = Current/Non-current (TBD)
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DesignMaterial Flow Deliverable
4. Inbound Transportation between Suppliers is not optimized which includesboth Parcel and LTL, normal and expedite shipping, and cross dockoperations. This is further complicated by the conflict between physicalspace for staging shipments to support truck utilization AND leadtime todealer order needs.
Metric P&L Line ImpactLine Fillrate Net Sales No impact on Line Fillrate.BackorderDuration
Net SalesCVA/EVA
Minimum of 2 days of backorderduration due to transportation time.
COGS Gross Profit Inbound transportation as a ruleshows up in STANDARD COST,MFG Variance and PurchaseVariance. 60% of the shipmentsare parcel. Actual spend in 1999was $2.5M.
Supply ChainCost
Direct ProfitContribution
The inbound cost of supply chaincost shows up in Warehouse linevia allocation. Actual spend in1999 was $.5M.
Assets CVA/EVA The FOB destination as currentlypracticed, is the Supplier’s dockwhich impacts the Inventory by anestimated $.1M (25 days)
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DesignMaterial Flow Deliverable
Ease of Implementation
Easy Tough
Bus
ines
s Im
pac
t Small Pay-Off
Big Pay-Off
Quick Hits Caution
Gems Extra Effort4
7
6 5
32
1
$ 1M Annual Savings
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DesignWork & Information Flow
Defines the work and information which moves the material
Incorporates the major system applications and transactions
“Swim Diagram” approach
Illustrates the impact of “e” to your business
Additive to the ROI derived in Material Flow
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A s - I s L e ve l 3 O p er at i o n sW o rk a n d I nf or ma t i o n F l o w
Pac
k/S
toc
kO
rde
r Fill
/
Shi
p
Inv
ento
ry
Con
trol
Ord
er F
ill/
Shi
pP
urch
asin
gP
ack
/Sto
ck
Rec
eiv
ing
Rec
eiv
ing
DC
2D
C1
HQ
S 2. 1 & S 1. 1
S che dul e M at er i al
D el ive r ie s
P 2. 4 Es ta bl ish
D et ai le d So ur ci ng
P la ns
S 2. 2 & S 1. 2
R ece ive and V er i fy
M at er i al
S 2. 3 & S 1. 3
T ra nsf er M at er i al
S 2. 2 & S 1. 2
R ece ive and V er i fy
M at er i al
S 2. 3 & S 1. 3
T ra nsf er M at er i al
Pkg Sli pf rom
Suppl ier
St ockxpor tf romDC 2
Recei ptTo AP
Pi ck Ti cket
Rel ease t o st ockM ove t icket
Rel ease t o
I nspe ct
Pkg Sli pf rom
Suppl ier
St ockxpor tf rom
Pl ants
Recei ptTo AP
ToSuppl ier
JITSchedul e
PO t oSuppl ier
To MFG( all pl ants)
St ockxpor t
Fi rmReq
?? ?
P 2. 3 Ba la nce
M at er i al
R eso ur ce s w i th
M at ' l R eqm t s
P 2. 2 Id en ti fy ,
A sse ss, &
A ggr e gat e M at ' l
R eso ur ce s
?? ??
D1. 1 P rocess Inqui ry &Quot e
D1. 2 R eceive, Ent er &Val idat e O rder
D1. 3 R eserve Invent ory
and Deter m ine Deli veryDat e
D 1. 4 C ons ol ida te
O r der s
D 1. 5 P lan & Bu il d
Lo ads
Cust omerDef ined Rout e
Del iver y
Due List
Fr omPl antsSt ock
xpor ts
St ock
Or der sFr om
Cust omer
Di rect
Or der sFr om
Cust omer
Backor ders
P 2. 1 Id en ti fy ,
P ri or i ti ze , &
A ggr e gat e M at er i al
R eso ur ce s
Cust omerBackor ders
Consum pti onRe- or der
poin tt ri pped
M arket ingPl an
NewPar tSet up
Pr oducti onSchedul e( seasonal)
?? ?
D 1. 4 C ons ol ida te
O r der s
D 1. 5 P lan & Bu il d
Lo ads
Cust omerDef ined Rout e
Del iver yDue List
Di rect
Or der sFr om
Cust omer
D 1. 6 R out e
S hi pm en ts
Cust omerDef ined Rout e
Del iver yDue List
D 1. 6 R out e
S hi pm en ts
Cust omerDef ined Rout e
Del iver y
Due List
S 1. 1 & S 1. 3
S UB C O N TR AC T
P RO C E SS
( pe r ch il d)
PO t oSuppl ier
541542
Par ent S1. 1
D1. 7 S elect Car r ier s andRat e S hipm ents
Cust omerDef inedRout e
Pi cki ng T ickets
Pi cki ng T ickets1/ line
D 1. 8, S2 .2 , & S 1. 2
R ece ive & V er if y
M at er i al ( P r odu ct )
D 1. 8, S2 .2 , S 2. 3,
S 1. 2 & S 1. 3
R ece ive , V er i fy ,
an d Tr an sf er
M at er i al ( P r odu ct )
D 1. 9 P ick P r odu ct
Avai lable
I nven tor
y
D 1. 9 P ick P r odu ct
Avai lable
I nven tory
Fr om
Subcont ractPr ocess541
PostGood sI ssue
D 1. 10 L oad
V ehi cl e, G e ner a te
S hi p Do cs, & S hi p
ToDC 2
St ockxpor t
D 1. 10 L oad
V ehi cl e, G e ner a te
S hi p Do cs, & S hi p
Handw ri tt en
Pi ck Ti cket
Handw ri tt en
Pi ck Ti cket
Xf er
Post ing
Post G oodsI ssue
To
VendorR- ti cket
BO L
To PlantM ovem ent
Type
BO L
To Custom er
Packi ng Sl ipBO L
M 1. 1 S che dul e
M an uf act ur i ng
A ct ivi t ie s
Re-or derPoi nt
Saf etySt ock
D1. 11 R eceive & V eri fy
M ater ial at C ust omerSi te
M 1. 3 M a nuf ac tu re
& T est ( Ki t ti ng )
D1. 13 I nvoice & Receive
Paym ent
Post G oodsI ssue
M 1. 2 I ssu e
M at er i al
Pr oducti on
Workor der
P 3 Pl an M a ke
( Ki t ti ng )SAP Pr oduct ion
Pi ckl ist
M 1. 4 P ack age
M 1. 5 S ta ge
P ro du ct
Physi calM ove
M 1. 6 R el ea se
P ro du ct t o
D el ive r
Pr oducti onOr der
Backf lush
Rel ease t o S tock
M ater ial M oveTo D1. 8, S1.1
P 4. 4 Es ta bl ish
D et ai le d
D el ive r y Pl ans
P 4. 3 Ba la nce
D el ive r y
R eso ur ce s w i thD el ive r y Re qm t s
To D1. 3D1. 5
P 4. 2 Id en ti fy ,
A sse ss, &
A ggr e gat e
D el ive r y
R eso ur ce s
P 4. 1 Id en ti fy ,P ri or i ti ze , &
A ggr e gat e
D el ive r y Re qm t s
Sam e asP2. 1
P 1. 4 Es ta bl ish
S upp ly C ha in
P la ns
?? ?
P 1. 3 Ba la nce
S upp ly- C ha in
R eso ur ce s w i th
S upp ly- C ha in
R eqm ts
??
P 1. 2 Id en ti fy ,
A sse ss, &A ggr e gat e
S upp ly- C ha in
R eso ur ce s
BudgetRqm ts
Ser viceLevelRqm ts
Tur nGoal s
Sal es $
ToDi stSal es
Goal s $
P 1. 1 Id en ti fy ,
P ri or i ti ze , an d
A ggr e gat e
S upp ly- C ha in
R qm t s
Fi nishedGood sUni ts in
Oper at ion
Ave Par tsUseage
$/Oper at ion
Sal es
Hi stor y$
ToCust omer
Packi ng Sl ipBO L
DesignWork & Information Flow Deliverable
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Inve
ntor
yC
ontr
olP
urch
asin
g
AS IS
DesignWork & Information Flow Deliverable
P1.4 Establish Supply Chain
Plans
P1.3 Balance Supply Chain
Resources with Supply Chain Requirements
P1.2 Identify, Assess, &
Aggregate Supply Chain Resources
P1.1 Identify, Prioritize, and
Aggregate Supply Chain
Requirements
??
??
BudgetRqmts
Sales$
Service Level Rqmts
Turn Goals
Sales Goals $
Finished Goods Units in
Operation
Sales History
$
Avg Product Usage
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Inv
ento
ryC
on
tro
lP
urc
ha
sin
gM
ark
etin
gM
anu
fact
uri
ng
TO BE
DesignWork & Information Flow Deliverable
P1.3 Balance Supply Chain
Resources With Supply
Chain Reqmts
P1.2 Identify,
Assess, & Aggregate
Supply Chain
Resources
P1.1 Identify,
Prioritize, and
Aggregate Supply Chain
Reqmts
P1.4 Establish Supply
Chain Plans
Unit Forecast
Existing Inventory
Net Unit Supply
Plan ProfitContribut
ion $$
Consensus Unit Plan
Rolling 12 mo Aggregate
Unit Plan (to P2)
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Develop Solution
Balance Quick Hits and Non-Technology Changes with Longer payback projects
Leverage a Conference Room Pilot Scenario
Link a formal Technology Selection Process to the Design Process
Transition Team from “Design” to “Implementation”
Detail “TO BE” Design at Level 4
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Challenges/Dependencies:
- Define Requirements
- Explore tool options
- Test/prove design
- Enlist support from MRP controllers
- Data integrity.
Recommendation: Design, test and implement an integrated supply chain demand planning/forecasting solution for Business Unit
Project Manager:Elaine Reichardt
Change Required:
- Organizational metrics
- Process changes/additions
- Separate demand and supply planning
- Technology changes
Opportunity/Benefit:$2MInventory reduction
Develop Solution DeliverableRecommendation Summary
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Develop Solution
Pace of Change
Fast Measured
Sco
pe
of
Ch
ang
e
Tactical
Strategic
Focused Improvement
Continuous Improvement
Focused Restructuring
Business Process Innovation
Balanced Project Mix
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TYPE PROJECT NAME START SCOR PROJECT MANAGER RESULTS PLAN END JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DECSUPPLY CHAIN SCOPE
Strategic Available to Promise Service Flex ibility 02/08/00
Deliver Jo Ellsw orth Cost Assets 12/31/00
Strategic Make-to-Order Service Flex ibility 10/01/99
Make Dav id Hendrickson Assets 06/30/00
Strategic Outsource Reconf iguration Service Flex ibility 12/03/99
Source Deb Lynch Cost Assets 12/31/00
Defic iency Non Working Inventory Reduction 07/19/99
Deliver Jay Gaus tad Assets 04/30/00
Defic iency Integrated Supply Chain Planning Service Flex ibility 08/16/99
Plan Peter Bolstorf f Cost Assets TBD
Defic iency Texas Consignment Service Flex ibility Det ermine Sched ule
Source Joe Comerford Cost Assets
Strategic Eff icient Material Acquis it ion Det ermine Sched ule
Source Elaine Reichardt Cost
Strategic Direc t to Consumer Transportation Service Flex ibility 03/01/00 2001 plan
Deliver Rick Hardcopf Assets 12/31/00
Co mpleteCap ital P lan
Co mplete Tes t
Br ains to rming
Sess io n
Quar terly
Act io nPlan
Co mplete 2ndQuar ter Plan
Co mplete 3r dQuar ter Plan
Co mplete 4t h
Quar ter Plan
Co mpleteImp lementation
Pro cess Des ig nValid atio n
Pro cess Cut over
PlanningReview
NWIDat a Integ ration
Disco nnects
Reviewed
Act io n
P lan
Mo nthly Act io n P lan R eviews - P lants
Br ains to rmPro ject Ob jectives ;
Set S tr ateg y
Develop Solution DeliverableMaster Project Schedule
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Develop Solution DeliverableLevel 4 Work & Information Flow
S a lesM an ag em e
n t
F ie ldS a les
In s ide
S a les
C u s tom e r
B u s ine ss
A n a lys is
P1.1
P la n nin g
M ar ke tin g
B D U
Det ermine Signif ica ntNet Cus tome r Change
@ SKU @ We ek
Ma int ain Ite m Mas terL ist
Updat e Ne w ProductIn troduct ion Plan @SKU w/ a ppropria te
Foreca st
ApproveRec omme nded SKU
Ret ire me nt s
ne w SKU w/for eca st
ina ctive SKUre comm end ed
SKU ret irem ents
Run M onth EndForeca st Update w/
Foreca st Met hod A, 1,and 2
act iveSKU list w/
con solida tedhist ory
Run Exce pt ion ReportUsing DT @ Product
Code @ 60- 90Forecc ast
up date dJBA &
DTsyste ms
Ana lyze SKUExce pt ions a nd
Conso lidat e Inpu t
SKU>± 25%
fr om 8 0%case volu me
list
Det ermine Signif ica ntMi x impa ct @ SKU @
Cus tome r @ Week
Ana lyze Promotiona lPerfo rmance @ SKU
@ Wee k
Ma int ain Promoti onalPerfo rmance Hi sto ry
@ SKU @ We ek
Ma int ain Promoti onalCale ndar @ SKU @
Wee k
Remodel Fore cas t
SKUExcept ionCha ngeSumm ary
Prom otio nalHisto ryInp ut
Prom otio nalImp act
Mix HistoryInp ut
Net Custom erCha nge Inp ut
Prom otio nCha nge s
Prom otio nalHisto ryInp ut
Ach ieve Conse nsuson 3 0-6 0 and 60- 90
day Forec ast
Reco mme nde dSKU Fo reca st
Adjustm ent s forExcept ions
Ach ieve Conse nsuson 3 0-6 0 and 60- 90
day Forec ast
Ach ieve Conse nsuson 3 0-6 0 and 60- 90
day Forec ast
Ach ieve Conse nsuson 3 0-6 0 and 60- 90
day Forec ast
SKU>± 25%
fr om 8 0%case volu me
list
SKU>± 25%
fr om 8 0%case volu me
list
SKU>± 25%
fr om 8 0%case volu me
list
28
Implement
Implementation of supply changes can be described in 3 phases– Transition– Installation– Institutionalization
Installation is an iterative process– Develop– Prepare– Cut-Over– Evaluate
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Implementation DeliverableDashboard, Self Funding Project
P & L
Results
As Is To Be
Rev Rev(COGS) (COGS)
Gross Gross(SG&A) (SG&A)
NOI NOI(Inv + AR (Inv + AR-AP/I%) -AP/I%)
EVA EVA
Define
PlanPlan
SourceSource
MakeMake
DeliverDeliver
Processes
Design & Improve
Flows
INFORMATION
WORK FLOW
MATERIALS
OPS Strategy
Measure
Performance
Inventory DaysDSO/AR
Order Lead-time
Fill Rate
ReworkAsset Turns
METRICS
Logistics Cost
Cash Cycle Time