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Supply Chain Excellence: A Handbook for Dramatic Improvement Using the SCOR Model, Second Edition

Book Description

The Supply Chain Council (SCC) is a nonprofit organization dedicated to developing best practices in supply chain management. Now in a newly revised, second edition,

Supply Chain Excellence

is the first and only book on the DCOR, CCOR, and SCOR Models. It gives professionals implementing new supply chain projects a clear, step-by-step guide to adopting the accepted and proven methodologies developed by the SCC. This book shows readers how they can:

* align strategy, material, workflow, and information * conduct the proper competitive analysis to define business opportunity * establish the metrics that will determine the project’s level of success * gain internal support by educating employees and executives

Complete with new case studies, a Value Chain Excellence project roadmap, and the addition of the DCOR and CCOR process frameworks, the second edition of Supply Chain Excellence gives readers all the practical tools they need, whether they’re trying to improve the performance of an existing supply chain system or implement a new one.

Table of Contents

  1. Copyright
    1. Dedication
  2. Preface
  3. Introduction
    1. Defining Supply Chains
    2. Supply Chain Performance Improvement: Fifteen Common Scenarios
      1. 1: Building a Technology Investment Plan
      2. 2: Searching for a Return on Investment
      3. 3: Creating a Supply Chain Strategy
      4. 4: Implementing a Supply Chain Strategy
      5. 5: Improving Sales and Operations Planning
      6. 6: Meeting Financial Commitments
      7. 7: Building Support and Competence
      8. 8: Optimizing Enterprise Resource Planning
      9. 9: Maximizing Use of Existing Technology
      10. 10: Achieving Operational Excellence
      11. 11: Performing Mergers and Acquisitions
      12. 12: Standardizing and Managing Business Processes
      13. 13: Extending the Value Chain to Solve Tough Issues
      14. 14: Integrating Lean Six Sigma and SCOR to Build a Better Project Portfolio
      15. 15: Defining and Building an Effective Supply Chain Organization
    3. Why Supply Chain Excellence?
    4. How This Book Is Structured
  4. Acknowledgments
  5. 1. About the Supply Chain Operations Reference Model
    1. The Supply-Chain Council
    2. The SCOR Framework
    3. Value Chain Processes
      1. “Operationalizing” the Definition of Value Chain
      2. Integrated Level One Processes
    4. Using SCOR to Drive Supply Chain Improvement
      1. Educate for Support
      2. Discover the Opportunity
      3. Analyze Basis of Competition
      4. Design Material Flow
      5. Design Work and Information Flow
      6. Implementation Planning and Project Portfolio Development
      7. Value Chain Excellence
    5. The Value of a SCOR Initiative
  6. 2. Building Organizational Support for Supply Chain Improvement: Planting the Seeds for Organizational Change: Educate for Support
    1. The Evangelist
      1. The Evangelist’s Resume
      2. Experience
    2. The Active Executive Sponsor
      1. Educate-for-Support Behaviors of the Active Executive Sponsor
      2. Planning and Organizing Behaviors of the Active Executive Sponsor
      3. Measures and Strategy Behaviors of the Active Executive Sponsor
      4. Design Solutions Behaviors of the Active Executive Sponsor
    3. Establishing Core Team Buy-In
      1. Collective Experience
      2. Attitude
      3. Effective Communication Skills
      4. Ability to Cope Well in Chaos
    4. Picking the Project Design Team
      1. Problem-Solving Experience
      2. Personality Factors
      3. Dedication: Discipline to Tasks
      4. Access to Data
  7. I. Discover the Opportunity
    1. 3. Week One: Planning and Organizing: Decide What to Work On and How to Get Started
      1. The Business Context Summary
        1. Strategic Background
        2. Financial Performance
        3. Internal Profile
        4. External Profile
        5. The Supply Chain Definition Matrix
      2. The Project Charter
  8. II. Analyze Basis of Competition
    1. 4. Week Two: Project Kickoff and Supply Chain Operations Reference Metrics: Get a Good Start and Begin to Define Supply Chain Metrics
      1. The Project Kickoff
      2. Picking a Balanced Set of Supply Chain Metrics
      3. Data Collection and Benchmarks
    2. 5. Week Three: Benchmarks, Competitive Requirements, and Steering Team Review Number One: Start to Put Data to Work
      1. Data Review
      2. Competitive Requirements Analysis
        1. Rules for Prioritization
      3. Preparing for Steering Team Review Number One
    3. 6. Week Four: Scorecards: Tackle the Difference Between Competitive Requirements and Actual Performance
      1. The Scorecard Review
      2. The Gap Analysis
  9. III. Design Material Flow
    1. 7. Week Five: Initiating AS IS Material Flow and Steering Team Review Number Two: Transition from Data Collection to Analysis and Action
      1. Validating Gap Analysis and Preparing Steering Team Review Number Two
        1. Change Management: Dealing with Denial
        2. Change Management: Placing Blame
        3. Change Management: Book the Numbers
      2. Launching Phase III: Design Material Flow
      3. Initiating AS IS Material Flow
      4. About the SCOR Level Two Process Types
        1. Source
        2. Make
        3. Deliver
        4. Return
        5. Plan
      5. Creating a Geographic Map
    2. 8. Week Six: The Planning Process Matrix, Thread Diagram, and Metric Defect Analysis: Build a Deep Understanding of Material Flow
      1. The Planning Process Matrix
      2. The Thread Diagram
      3. Metric Defect Analysis
        1. Perfect Order Fulfillment (and Line Item On Time and In Full)
        2. Order Fulfillment Cycle Time
        3. Upside Supply Chain Flexibility
        4. Cost of Goods, Total Supply Chain Management, and Total Return Management and Warranty Costs
        5. Inventory Days of Supply
      4. Planning for Next Week: Disconnect Analysis
    3. 9. Week Seven: Material Flow Disconnect Analysis and Steering Team Review Number Three: Add Up the Value While Getting the Whole Company Involved
      1. Planning the Brainstorm Event
        1. Invitees
        2. Effective Communication
        3. Organized Brainstorm Categories
        4. The Appropriate Venue
        5. Predefined Leadership Roles
        6. Documentation Approach
      2. Conducting the Brainstorm Session
      3. Conducting Steering Team Review Number Three
    4. 10. Week Eight: The Project Portfolio: How to Take Sixty-Two Issues Down to Fifteen Projects
      1. Consolidating Problems to Projects
      2. Assessing Impact and Effort
    5. 11. Week Nine: Opportunity Analysis and Steering Team Review Number Four: Due Diligence for the Project List
      1. The Opportunity Analysis
        1. The Project Opportunity Worksheet
        2. Identify Further Validation Resources
      2. Conducting Steering Team Review Number Four
    6. 12. Week Ten: TO BE Material Flow: Identify the Drivers for Change
      1. Identifying the Drivers of Change
        1. Thoughts on Leading Practices
      2. Refining TO BE Models and Initiating Quick-Hit Plans
    7. 13. Week Eleven: Quick-Hit Plans, Steering Team Review Number Five, and Initiating the Work and Information Flow Analysis: Dig into Work and Information Flow
      1. Reviewing and Refining Quick-Hit Mini-Charters
      2. Initiating AS IS Work and Information Flow
      3. Planning the Staple Yourself Interviews
      4. Conducting Steering Team Review Number Five
  10. IV. Work and Information Flow Analysis and Design
    1. 14. Week Twelve: The Staple Yourself Interview: Follow the Information Step by Step
      1. Preparing for the Staple Yourself Interview
      2. Understanding the Staple Yourself Interview Worksheet
    2. 15. Week Thirteen: The AS IS Process, Understanding Functional Responsibility, and Steering Team Review Number Six: Learn About Who Really Does What and When
      1. Assembling the Preliminary AS IS Process Diagram
      2. Assembling the Functional Areas and Responsibilities Diagrams
        1. P1.1: Identify, Prioritize, and Aggregate Supply Chain Requirements (Demand Planning)
        2. P1.2: Identify, Assess, and Aggregate Supply Chain Resources (Supply Planning)
        3. P1.3: Balance Supply Chain Resources with Supply Chain Requirements (Reconciliation)
        4. P1.4: Establish and Communicate Supply Chain Plans (Senior Leadership Review)
      3. Steering Team Review No. 6
    3. 16. Week Fourteen: The Process Performance Summary: The Numbers Behind the Pictures
      1. Assembling the Process Performance Summary
        1. Leading Practice Assessment
      2. Initiating TO BE Work and Information Flow
        1. The Blueprint Education
        2. The Fowlers’ SCOR Blueprint Tour
    4. 17. Week Fifteen: The TO BE Work and Information Flow Blueprint and Steering Team Review Number Seven: Define How the Business Should Work
      1. Configuring the Blueprint
      2. Process Maturity and Executive Change: Thinking Ahead
        1. Maturity Checklist
          1. Organizational
          2. Process
          3. Job performer
          4. Technical
        2. Typical Impact of Increasing S&OP Maturity on the Executive
      3. Conducting Steering Team Review Number Seven
    5. 18. Week Sixteen: Level Four Process Development: Where the Process Rubber Hits the Implementation Road
      1. Constructing a SCOR Level 4 Process
      2. Applications of SCOR Level Four Processes
    6. 19. Week Seventeen: Implementation Planning, Program Management, and Steering Team Review Number Eight: Organizing Supply Chain Improvement as Part of Daily Life
      1. Program Management
        1. Supply Chain Process Management
        2. Organization
      2. The Final Steering Team Review
    7. 20. Extending Excellence Beyond the Supply Chain: Improving the Value Chain by Analyzing Barriers to Profitable Growth
      1. Value Chain Excellence
      2. Educate for Value Chain Support
        1. Identify Value Chain Improvement Roles, Evangelists, Active Executive Sponsor(s), Core Steering, and Design Teams
        2. Assemble and Deliver Appropriate Educational Content and Gain Consensus for a Pilot Project
        3. Durable Products Group Challenges
      3. Discover Value Chain Opportunity
        1. Calculate the Number of Value Chains
        2. Assemble High-Level Industry Comparison
        3. Deciding on Your Project Scope
          1. Durable Products Group challenges
      4. Analyze Value Chain Basis of Competition
        1. Identify Appropriate Value Chain Performance Metrics and Assemble Appropriate Benchmark Comparisons (Combined Steps 1 and 2)
        2. Assess and Prioritize Competitive Requirements
          1. Durable Products Group challenges
      5. Design Product-to-Market Flow
        1. Metric Defect Analysis
        2. Product-to-Market Maps
        3. Process Thread Diagrams
        4. Disconnect and Opportunity Analysis
          1. Durable Products Group challenges
      6. Design Work and Information Flow
        1. Staple Yourself Interviews
        2. Level Three Process, Functional Areas, and Responsibilities Diagrams
        3. Process Performance Summaries
        4. TO BE Level Four Process Diagrams with Information System Storyboards
          1. Durable Products Group challenges
      7. Implementing Value Chain Improvements
      8. Value Chain Conclusions
  11. Fowlers: Business Context Summary
    1. Strategic Profile
      1. Business Description
        1. Food Products Group
        2. Technology Products Group
        3. Durable Products Group
        4. SWOT Analysis Summary
          1. Strengths
          2. Weaknesses
          3. Opportunities
          4. Threats
        5. Value Proposition
          1. Critical Success Factors
          2. Critical Business Issues
        6. Fowlers Financial Information
          1. Financial Performance—Key Points
      2. Internal Profile
        1. Organization
          1. Manufacturing Locations
          2. Distribution Locations
        2. Key Performance Indicators
        3. External Profile
          1. Market Channel/Customer
          2. Suppliers
  12. Fowlers’ Supply Chain Excellence Project Charter
    1. Introduction
      1. Purpose of the Project Charter
      2. Project Charter Contents
        1. Maintenance of the Project Charter
      3. Project Overview
        1. In Scope—White Areas
        2. Out of Scope—Gray Area
          1. Business Objectives
          2. Project Objectives
      4. Project Approach
        1. Methodology
        2. Risks & Dependencies
      5. Roles and Responsibilities
        1. Fowlers’ Steering Team
        2. Fowlers’ Project Sponsor
        3. Fowlers’ Project Manager
        4. Fowlers’ Design Team
        5. Fowlers’ Extended Team
        6. Coach
        7. Benefits and Measures of Success
          1. Stakeholder Expectations
        8. Benchmarks
        9. Benefit Analysis
          1. Project Communication
  13. SCOR and Six Sigma DMAIC Comparison
  14. Supply-Chain Operations Reference-model
    1. Section One: What Is a Process Reference Model?
      1. A Process Reference Model Contains
      2. Once a Complex Management Process is Captured in Standard Process Reference Model Form, It can Be
    2. Section Two: Model Scope and Structure
      1. The Boundaries of Any Model Must Be Carefully Defined
        1. SCOR spans
        2. SCOR does not attempt to describe every business process or activity, including
        3. SCOR assumes but does not explicitly address
      2. Scope of SCOR Processes
      3. A Process Reference Model Differs from Classic Process Decomposition Models
      4. SCOR Contains Three Levels of Process Detail
      5. Process Categories
        1. Level 1 Process Definitions
        2. Performance Attributes and Level 1 Metrics
        3. At Level 2, Each Process Can Be Further Described by Type
      6. SCOR Version 8.0 Level 2 Toolkit
      7. SCOR Level 3
        1. S1 Source Stocked Product
          1. S1.2 Detail
            1. SCOR Model Structure
      8. Examples
      9. Implementation of Supply-Chain Management Practices within the Company Occurs at Level 4 (and below)
    3. Section Three: Applying the SCOR Model
      1. The Concept of “Configurability”
        1. Each Basic Supply-Chain is a “Chain” of Source, Make, and Deliver Execution Processes
        2. How SCOR Logic Supports Horizontal Process Integration
        3. How SCOR Describes One SCM Trade-off
          1. Make-to-Stock Configuration
          2. Make-to-Order Configuration
      2. Configuring Supply-Chain Threads
        1. Supply Chain Threads are Developed from the Geographic Product Flow
      3. SCOR Process Maps are Used as a Basis for Evaluating/Understanding the Supply Chain
        1. In a Classic Logistics World
        2. Effective Supply-Chain Management Requires Balancing Multiple Links Concurrently
    4. Section Four: SCOR Overview Summary
      1. SCOR is used to describe, measure and evaluate Supply-Chain configurations
  15. Partial List of SCOR Model Leading Practices, Sorted by Business Area
    1. The SCOR-model
      1. S1 Source Stocked Product
        1. S1.2 Detail
          1. SCOR Model Structure
  16. Design-Chain Operations Reference-model
    1. The DCOR-model
      1. DCOR Contains Three Levels of Process Detail