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
Capture the “as-is” of a process and derive
state of a process the desired “to-be”
and derive the future state
desired “to-be” Quantify the Quantify the operational
future state operational performance of similar
performance of companies and establish
similar companies internal targets based on
and establish “best-in-class” results
internal targets Characterize the
based on “best-in- Characterize the management
class” results management practices and
practices and software solutions
software solutions that result in “best-in-
that result in class” performance
Business Process Benchmarking “best-in-class”
Best Practices Process Reference
Reengineering performance
Analysis 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 Source Make Deliver Source Make Deliver Source Make Deliver Source

Return Return Return Return

Supplier’s Return Return

Customer’s
Supplier Customer
Supplier Customer
(Internal or (Internal or
Your Company External)
External)

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
 Level
Three Levels of Process Detail
# Description Schematic Comments

1 Level 1 defines the scope and content for the

Plan Supply chain Operations Reference-model. Here
Supply Chain Operations Reference Model

Top Level Source Make Deliver basis of competition performance targets are set.
(Process
Types) Return Return

2
A company’s supply chain can be “configured-
Configuration to-order” at Level 2 from the core “process
Level (Process categories.” Companies implement their
Categories) operations strategy through the configuration
they choose for their supply chain.

3 Level 3 defines a company’s ability to compete

Process
successfully in its chosen markets, and consists
Element Level
of:
(Decompose
•Process element definitions
Processes)
P1.1
Identify, Prioritize, and Aggregate •Process element information inputs, and outputs
•Process performance metrics
Supply-Chain Requirements
P1.3 P1.4
Balance Production Resources with Establish and
P1.2
Identify, Assess, and Aggregate
Supply-Chain Requirements Communicate
Supply-Chain Plans •Best practices, where applicable
Supply-Chain Requirements
•System capabilities required to support best
practices
•Systems/tools

4 Implementatio Companies implement specific supply-chain

n Level management practices at this level. Level 4
Not defines practices to achieve competitive
(Decompose
in Scope advantage and to adapt to changing business
Process
Elements) conditions.
 Customer-Facing Internal-Facing
Level 1 Supply Chain Responsiveness Flexibility

Performance Metrics
Reliability
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 
 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-Source-Make-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 Level 2 Process Categories
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
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 None Identified
Alliance and Leverage agreements
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-of- Pay on receipt
use in manufacturing to reduce costs and Specify delivery location and time (to the
cycle time minute)
Specify delivery sequence
Capability Transfer to Organization None Identified
Example Continued

Inputs Plan Source Make Deliver

Product Pull Signals M D
Product Inventory Location ES.4
WIP Inventory Location EM
Finished Goods Inventory ED
Location

Outputs Plan Source Make Deliver

Inventory Availability P2.2 ES.4 M1.2, D1.8,
M2.2, D4.2
M3.3
Daily Replenishment D4.1
Requirements
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 Suppliers Assemble/ Package Distribution Centers Geo Ports of Entry

Supplier

Americas--->

Europe--->

Asia--->
 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%2
06.0%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