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The SCOR model is a process reference model that integrates the well-known concepts of business process reengineering, benchmarking, and process measurement into a cross-functional framework. A process reference model contains standard descriptions of management processes; a framework of relationships among the standard processes; standard metrics to measure process performance; management practices that produce best-in-class performance; and standard alignment to features and functionality.
Once a complex supply chain management process is captured in the SCOR standard process
reference model forms, it can be implemented purposefully to achieve competitive advantage, it is described unambiguously and communicated, measured, managed, and controlled, and tuned and re-tuned to a specific purpose. Bottom line, SCOR is a process reference model that provides a language for communicating among supply-chain partners. solutions to the SCOR key performance indicators.
SCOR is a hierarchical process reference model based on 3 levels.
At the first level (Level 1) we have five core Management Processes that provide the organizational structure of the model. SCOR decomposes any complex supply chain management processes into these Level 1 core processes, also called 'Process Types':
PLAN: Processes that balance aggregate demand and supply to develop a course of action which
best meets sourcing, production and delivery requirements.
SOURCE: Processes that procure goods and services to meet planned or actual demand.
MAKE: Processes that transform product to a finished state to meet planned or actual demand.
DELIVER: Processes that provide finished goods and services to meet planned or actual demand, typically including order management, transportation management, and distribution management.
RETURN: Processes associated with returning or receiving returned products for any reason.
These processes extend into post-delivery customer support. A set of standard notations is used throughout the model. For Level1 Process Types, P depicts Plan elements; S depicts Source elements; M depicts Make elements; D depicts Deliver elements; R depicts return elements.
At Level 2, each SCOR process can be further described by a Process Category. From the SCOR Toolkit, an example of Process Category is M1 - Make to Stock - that describes the process of manufacturing in a Make-to-Stock environment. Make to stock products are intended to be shipped from finished goods or "off the shelf", are completed prior to receipt of a customer order, and are generally produced in accordance with a sales forecast. According to the SCOR hierarchical structure, the 'M1' notation indicates a Level 2 process category.
A SCOR Level 3 Process Element presents detailed information for each Level 2 Process Category.
An example of SCOR Level 3 Process Element logic flow for the Level 2 Process Category S1 -
Source Stocked Product - (MILK AND MILK PRODUCTS (MOTHER DAIRY) is provided below.
The SCOR Metrics
SCOR uses five performance measures categories or "SCOR Performance Attributes." The
Performance Attributes are characteristics of the supply chain that permit it to be analyzed and
evaluated against other supply chains with competing strategies. Just as to describe a physical
object like a piece of lumber using standard characteristics (e.g., height, width, depth), a supply
chain requires standard characteristics to be described. Without these characteristics it is extremely difficult to compare an organization that chooses to be the low-cost provider against an organization that chooses to compete on reliability and performance.
Performance Attributes include:
Supply Chain Reliability
The performance of the supply chain in delivering the correct product, to the correct place, at the
correct time, in the correct condition and packaging, in the correct quantity, with the correct
documentation, to the correct customer.
Supply Chain Flexibility
The agility of a supply chain in responding to marketplace changes to gain or maintain competitive advantage.
Supply Chain Responsiveness
The velocity at which a supply chain provides products to the customer.
Supply Chain Costs
The costs associated with operating the supply chain.
Supply Chain Asset Management
The effectiveness of an organization in managing assets to support demand satisfaction. This
includes the management of all assets: fixed and working capital.Related to these attributes is a set of Level 1 metrics for which SCOR provides the algorithms tocalculate the numerical results as well as the impact these metrics will have on the company's balance sheet and income statement. Level 1 Metrics are primary, high level measures that may cross multiple SCOR processes.
ttribute Definition Level 1 Metric
The performance of the supply chain indelivering: the correct product, to the correct place, at the correct time, in the correct condition and packaging, in the correct quantity, with the correct documentation, to the correct customer. Perfect Order Fulfillment
The speed at which a supply chain provides products to the customer. Order Fulfillment Cycle Time Upside Supply Chain Flexibility Upside Supply Chain Adaptability
The agility of a supply chain in responding to marketplace changes to gain or maintain competitive advantage. Downside Supply Chain Adaptability
Supply Chain Supply Chain Management Cost
The costs associated with operating the supply chain. Cost of Goods Sold
Supply Chain Cash-to-Cash Cycle Time
The effectiveness of an organization in managing assets to support demand satisfaction. This includes the management of all assets: fixed and working capital.
Return on Supply Chain Fixed
Metrics in the Model are hierarchical - just as the Process Elements themselves.
Level 1 Metrics are created from lower level calculations. (Level 1 Metrics are primary, high level
measures that may cross multiple SCOR processes. Level 1 Metrics do not - however - necessarily
relate to a specific SCOR Level 1 process (PLAN, SOURCE, MAKE, DELIVER, RETURN).