Supply Chain Operations
Reference Model (SCOR)
Ozgun C. Demirag
Supply Chain Operations Reference Model
(SCOR): Information about (SCC)
Developed by Supply Chain Council (SCC)
SCC: Independent, not-for-profit corporation organized in 1996 by:
Global management-consulting firm, Pittiglio Rabin Todd &
McGrath (PRTM) and
Market research firm, Advanced Manufacturing Research (AMR)
in Cambridge, Massachusetts.
Started with 69 voluntary companies; now close to 1000 members.
SCC Objective: To develop a standard supply-chain process reference
model enabling effective communication among the supply chain
partners, by
Using standard terminology to better communicate and learn the
supply chain issues
Using standard metrics to compare and measure their performances
Supply Chain Operations Reference Model
(SCOR)
SCOR:
Integrates Business Process Reengineering, Benchmarking, and
Process Measurement into a cross-functional framework.
Capture the “as-is”
state of a process
and derive the
desired “to-be”
future state
Business Process
Reengineering
Capture the “as-is” state
of a process and derive
the desired “to-be”
future state
Quantify the
operational
performance of
similar companies
and establish
internal targets
based on “best-inclass” results
Benchmarking
Characterize the
management
practices and
software solutions
that result in “bestin-class”
performance
Best Practices
Analysis
Quantify the operational
performance of similar
companies and establish
internal targets based on
“best-in-class” results
Characterize the
management
practices and
software solutions
that result in “best-inclass” performance
Process Reference
Model
Supply Chain Operations Reference Model
(SCOR)
The Primary Use of SCOR:
To describe, measure and evaluate supply chain configurations.
SCOR 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
Enables the companies to:
Evaluate and compare their performances with other companies
effectively
Identify and pursue specific competitive advantages
Identify software tools best suited to their specific process
requirements
Supply Chain Operations Reference Model
(SCOR): Boundaries
SCOR spans:
• All customer interactions, from order entry through paid invoice.
• All product (physical material and service) transactions, from
supplier’s supplier to customer’s customer, including equipment, supplies,
spare parts, bulk product, software, etc.
• All market interactions, from the understanding of aggregate demand
to the fulfillment of each order
SCOR does not attempt to describe every business process or activity,
including:
• Sales and marketing (demand generation)
• Research and technology development
• Product development
• Some elements of post-delivery customer support
Supply Chain Operations Reference Model
(SCOR):Basic Management Processes
Plan-Source-Make-Deliver-Return
Plan
Deliver
Supplier’s
Supplier
Source
Return
Make
Deliver
Return
Supplier
(Internal or
External)
Source
Make
Return
Deliver
Return
Your Company
Source
Return
Make
Deliver
Source
Return
Customer
(Internal or
External)
Customer’s
Customer
Plan-Source-Make-Deliver-Return provide the organizational structure of the SCOR-model
Scopes of Basic Management Processes
Plan (Processes that balance aggregate demand and supply to develop a
course of action which best meets sourcing, production and delivery
requirements)
Balance resources with requirements
Establish/communicate plans for the whole supply chain
Source (Processes that procure goods and services to meet planned or
actual demand)
Schedule deliveries (receive, verify, transfer)
Make (Processes that transform product to a finished state to meet planned or
actual demand)
Schedule production
Deliver (Processes that provide finished goods and services to meet planned
or actual demand, typically including order management, transportation
management, and distribution management)
Warehouse management from receiving and picking product to load and
ship product.
Return (Processes associated with returning or receiving returned products)
Manage Return business rules
Three Levels of Process Detail
Level
#
Description
Supply Chain Operations Reference Model
1
Top Level
(Process Types)
Plan
Source
Return
Make
Deliver
A company’s supply chain can be “configuredto-order” at Level 2 from the core “process
categories.” Companies implement their
operations strategy through the configuration
they choose for their supply chain.
Configuration Level
(Process
Categories)
3
Process Element
Level (Decompose
Processes)
P1.1
Identify, Prioritize, and Aggregate
Supply-Chain Requirements
P1.2
Identify, Assess, and Aggregate
Supply-Chain Requirements
Implementation
Level (Decompose
Process Elements)
Level 1 defines the scope and content for the
Supply chain Operations Reference-model. Here
basis of competition performance targets are set.
Return
2
4
Not
in Scope
Comments
Schematic
P1.3
P1.4
Balance Production Resources with
Supply-Chain Requirements
Establish and
Communicate
Supply-Chain Plans
Level 3 defines a company’s ability to compete
successfully in its chosen markets, and consists
of:
Process element definitions
Process element information inputs, and outputs
Process performance metrics
Best practices, where applicable
System capabilities required to support best
practices
Systems/tools
Companies implement specific supply-chain
management practices at this level. Level 4
defines practices to achieve competitive
advantage and to adapt to changing business
conditions.
Level 1
Performance Metrics
Customer-Facing
Supply Chain
Reliability
Responsiveness
Internal-Facing
Flexibility
Cost
Assets
Performance Attributes
Delivery performance
Fill rate
Perfect order fulfillment
Order fulfillment lead time
Supply Chain Response Time
Production flexibility
Total SCM cost
Cost of Goods Sold
Value-added productivity
Warranty cost or returns processing cost
Cash-to-cash cycle time
Inventory days of supply
Asset turns
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Level Metrics Facts
Level 1 Metrics are primary, high level measures that may cross
multiple SCOR processes.
They do not necessarily relate to a SCOR Level 1 process (Plan-SourceMake-Deliver-Return).
There is hierarchy among the metrics in different levels.
Level 1 Metrics are created from lower level calculations (Level 2
metrics)
Level 2 Metrics:
Associated with a narrower subset of processes.
Example:
Metric related with Delivery Performance: Total number of
products delivered on time and in full based on a commit
date.
Metric related with Production: Ratio Of Actual To Theoretical
Cycle Time
Level 2 Process Types and Definitions
Planning: A process that aligns expected resources to meet expected
demand requirements.
Balance aggregated demand and supply
Consider consistent planning horizon
(Generally) occur at regular, periodic intervals
Execution: A process triggered by planned or actual demand that
changes the state of material goods.
Scheduling/sequencing
Transforming product
Moving product to the next process
Enable: A process that prepares, maintains, or manages information or
relationships on which planning and execution processes rely
P1: Plan Supply Chain
P2-P5: Plan SCOR Process
S1: Source Stocked Product
S3: Source Engineer-to-Order Product
S2: Source Make-to-Order Product
M1: Make-to-Stock
M2: Make-to-Order
M3: Engineer-to-Order
D1: Deliver Stocked Product
D2: Deliver Make-to-Order Product
D3: Deliver Engineer-to-Order Product
D4: Deliver Retail Product (New in Version
6.0)
SR1/DR1: Return Defective Product (Source
Return/Deliver Return)
SR2: Source Return MRO Product
(Maintenance, Repair and Overhaul)
DR2: Deliver Return MRO Product
SR3/DR3: Return Excess Product (Source
Return/Deliver Return)
EP, ES, EM, ED, ER: Enable corresponding
SCOR Processes
Level 2 Process Categories
Example Continued
Process Number: S1
Process Category: Source Stocked Product
Process Category Definition
The procurement, delivery, receipt and transfer of raw material items, subassemblies, product and
or services.
Performance Attributes
Metric
Reliability
% Orders/lines processed complete
Responsiveness
Total Source Cycle Time to Completion
Flexibility
Time and Cost related to Expediting the
Sourcing Processes of Procurement,
Delivery, Receiving and Transfer.
Cost
Product Acquisition Costs
Assets
Inventory DOS
Best Practices
Features
Joint Service Agreements
Alliance and Leverage agreements
None Identified
Example Continued
Process Element Number: S1.4
Process Element: Transfer Product
Process Element Definition
The transfer of accepted product to the appropriate stocking location within the supply chain.
This includes all of the activities associated with repackaging, staging, transferring and stocking
product. For service this is the transfer or application of service to the final customer or end
user.
Performance Attributes
Metric
Reliability
% Product transferred damage free
% Product transferred complete
% Product transferred on-time to demand
requirement
% Product transferred without transaction errors
Responsiveness
Transfer Cycle Time
Flexibility
Time and Cost Reduction related to Expediting
the Transfer Process.
Cost
Transfer & Product storage costs as a % of
Product Acquisition Costs
Assets
Inventory DOS
Best Practices
Features
Drive deliveries directly to stock or point-ofuse in manufacturing to reduce costs and
cycle time
Pay on receipt
Specify delivery location and time (to the
minute)
Specify delivery sequence
Capability Transfer to Organization
None Identified
Example Continued
Inputs
Plan
Source
Product Pull Signals
Product Inventory Location
Make
Deliver
M
D
ES.4
WIP Inventory Location
EM
ED
Finished Goods Inventory
Location
Outputs
Plan
Source
Make
Deliver
Inventory Availability
P2.2
ES.4
M1.2,
M2.2,
M3.3
D1.8,
D4.2
Daily Replenishment
Requirements
D4.1
Loaded Cart
D4.4
Some Graphical Tools:
1st Step in configuring a SC: Illustrate physical layout, material flow
and place Level 2 execution process categories to describe activities
at each location.
SCOR Process Maps
2nd Step: Create the SCOR Process Maps: Place planning process
categories, using dashed lines to show links with execution processes
Software Package for Modeling SCOR: ARIS EasySCOR
The ARIS Toolset and ARIS Easy Design are process modeling
tools. The ARIS Toolset is a BPR tool, Easy Design is used for
process capture.
The EasySCOR Modeler is a software package that includes the
ARIS Easy Design modeling kit and the SCOR model in ARIS
format.
ARIS EasySCOR consists of process models that describe the
SCOR levels 1 to 3. Implementation level, level 4 is not
included.
Process Map Example created in ARIS EasySCOR
Suppliers
Supplier
Suppliers
Assemble/ Package
Distribution Centers
Americas--->
Europe--->
Asia--->
Geo Ports of Entry
Observations
SCOR describes processes not functions. In other
words, the Model focuses on the activity involved, not
the person or organizational element that performs
the activity.
Implementation level, Level 4, is not described in
SCOR.
References
SCOR 6.0 Overview Booklet
http://www.isye.gatech.edu/~lfm/8851/Sources/SCOR/SCOR%206.0%
20OverviewBooklet.pdf
Supply-Chain Operations Reference-model
(SCOR) 6.0 Introduction (in setup files)
About ARIS:
http://www.changeware.net/esitteet/scor-faq.pdf
About ARIS:
http://www.changeware.net/esitteet/scor-faq.pdf