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SCOR Model: Analyzing Supply Chain Operations

• SCOR analyzes supply chain operations in three levels based on five management processes.
• The processes of Source, Make, and Deliver of the company, clients, and suppliers form a "supply chain" planned as a whole by the actors in the Plan process.
• The process Return is included in all "contact links" Deliver-Source for managing returns.
• Level 1 defines the scope and content for the Supply Chain Operations Reference-model, where basic strategic objectives regarding operations areas are established.
• PLAN process balances aggregate demand and supply to develop a course of action that meets business rules and sets competition performance targets.
• To avoid the Bullwhip effect, companies must establish narrow relations with suppliers and clients to plan production according to demand.
• Inventory planning for agricultural businesses is challenging due to uncontrollable events affecting the product procured.
• SOURCE process procures goods and services to meet planned or actual demand, and quality standards must be established by suppliers to satisfy final clients.
• MAKE process transforms goods to a finished state to meet planned or actual demand, taking into account all activities of the transformation process and consumer preferences.
• DELIVER process provides finished goods and services to meet planned or actual demand, including order management, transportation management, and distribution management.
• For perishable inputs, a short supply interval is necessary to support minimal inventory and avoid high storage costs.
• To continuously improve the process, quality standards and methods are proposed to support stepwise control of the productive process and satisfy consumer needs.

Overview of Supply Chain Operations Reference (SCOR) Model

• The SCOR model includes processes for delivering finished goods and services to meet planned or actual demand, such as order management, transportation management, and distribution management.
• The process of delivery involves managing client requirements and shipments of products while minimizing unnecessary costs of transport and excessive deliveries.
• The process of returns management involves handling returned products and raw materials efficiently to minimize costs and maintain good relations with clients and suppliers.
• Companies can configure their supply chain at Level 2 by selecting from 30 core process categories defined by the relationship between a SCOR process and a process type.
• The Planning process type involves aligning necessary resources to meet demand, while the Execution process type involves transforming materials and sequencing production based on demand.
• The Enable process type supports and prepares information or relationships on which the Planning and Execution processes depend.
• Level 3 of the SCOR model presents detailed information for each Level 2 process category, including process element definitions, inputs and outputs, performance metrics, best practices, and required system capabilities.
• In the Source process, it is important to differentiate treatment of inputs and raw materials based on their shelf life, and to use tools for analyzing provider companies to establish strong interrelationships with the Deliver process.
• Maintaining quality control throughout the supply chain is crucial for food products.
• The Make process involves detailed information on production phases such as stewing, cooling, packing, and storage, as well as distribution.
• The SCOR model helps companies identify necessary inputs and outputs for each process element, and establish best practices and system capabilities to compete successfully in their chosen markets.
• Effective supply chain management can lead to competitive advantages and cost savings while maintaining good relationships with clients and suppliers.

Overview of SCOR Methodology and Metrics

• SCOR methodology presents detailed information on the process elements of Make, Source, and Deliver, including material flows, income sources, and product destinations.
• The methodology considers production phases, such as stewing, cooling, and packing, as well as later phases like storage, freezing, and distribution.
• It takes into account different treatment for managing orders from normal clients versus orders from retailers, with the latter requiring more fluency and anticipation.
• SCOR methodology identifies strengths such as a structured approach for aligning strategic and operational metrics, standardized multi-level process performance metrics, and industry benchmark data sources.
• It also identifies weaknesses such as inadequate organization-wide training and development and few analytical tools for problem-solving at the macro-level.
• SCOR defines five generic performance attributes and three levels of measures for measuring supply chain performance.
• The five performance attributes are reliability, responsiveness, agility, cost, and asset management.
• The three levels of measures are m0 (internal-facing measures), m1 (customer-facing measures), and m2 and m3 (measures for specific processes and sub-processes).
• SCOR metrics must link to business objectives, be repeatable, and provide insights into managing the supply chain more effectively.
• The SCOR team can use variations and refinements of the measures to measure sub-processes or activities.
• The SCORcard shows the performance attributes, a set of metrics, and benchmark data for a hypothetical company, along with estimates of potential value achieved by moving the supply chain process closer to industry averages.
• SCOR methodology can help companies identify improvement opportunities and deliver a comprehensive opportunity and project portfolio with detailed ROI analysis.