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
Capture
the
as-is
state
of
a
process
state
of
a
process
and
the
andderive
derive
the
desired
to-be
desired
to-be
future
futurestate
state

Business Process
Reengineering

Quantify
Quantifythe
the
operational
operational
performance
of
performance
of
similar
companies
similar
companies
and
andestablish
establish
internal
targets
internal
targets
based
on
best-inbased
on
best-inclass
results
class results

Benchmarking

Capture
the
state
Capture
theas-is
as-is
state
of
a
process
and
derive
of
a
process
and
derive
the
to-be
thedesired
desired
to-be
future
state
future state

Characterize
Characterizethe
the
management
management
practices
and
practicessolutions
and
software
software
solutions
that
thatresult
resultinin
best-in-class
best-in-class
performance
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,
configurations.

measure

and

evaluate

supply

chain

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
suppliers supplier to customers 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

Suppliers
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)

Customers
Customer

Plan-Source-Make-Deliver-Return provide the organizational structure of the SCORmodel

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

Top Level
(Process Types)

Plan
Source
Return

Make

Deliver

A companys supply chain can be configured-toorder 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)

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

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 companys 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

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 (PlanSource-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
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

ES.4

WIP Inventory Location

EM

Finished Goods Inventory

Location

ED

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