0
Using SCOR to Integrate your Customer’s Customer Into  Your Supply Chain  Module 5: Fall Conference Dallas, TX November 24...
© Copyright 1997 The Supply-Chain Council 15536 The Supply Chain Operations Reference-model (SCOR) has been developed and ...
Agenda <ul><li>Imperative:  Why Are Companies “Integrating” Their  Supply Chains? </li></ul><ul><li>Benefits of Integratin...
Session objectives <ul><li>Demonstrate the imperative for integrating downstream customers into your supply chain </li></u...
Imperative for “Integrating”  Supply Chains © Copyright 1997 The Supply-Chain Council 15536–Module 5
Historically, intercompany relationships consisted of one-way, sequential flow of material and information <ul><li>Activit...
Competition is driving intercompany integration… <ul><ul><li>“ Establish flexibility to weather unpredictability” </li></u...
… coupled with new “enablers” that make it easier <ul><li>Electronic Commerce—EDI, provides “seamless” links of data </li>...
<ul><li>Partnering with customers has increased flexibility, and on-time delivery, yielding satisfied customers </li></ul>...
Leaders   increase profit margins through customer integration <ul><li>Integration of downstream customers lowers the cost...
Leaders stabilize operations  through customer integration <ul><li>Predictability of supply is increasing in emphasis </li...
Leaders realize product differentiation  through customer integration   <ul><li>Manufacturers leverage customers to develo...
Benefits of Integrating  Supply Chains © Copyright 1997 The Supply-Chain Council 15536–Module 5
PRTM’s benchmark studies show that quantifiable benefits can be carried to the bottom line Source:  PRTM Integrated Supply...
Integrating the supply chain also yields a wealth of qualitative benefits <ul><li>Common supply-chain “language” that faci...
What Does Integration Mean? © Copyright 1997 The Supply-Chain Council 15536–Module 5
Planning links suppliers’ and customers’ supply-chain management processes <ul><li>Each intersection of two execution Proc...
Supply-chain integration is based on “sharing” <ul><li>Shared objectives </li></ul><ul><ul><li>A clear understanding and m...
Customer integration requires joint planning, schedule sharing and rapid replenishment Manufacturer Customer Joint Plannin...
Best-in-class companies are using a variety of practices to achieve customer integration Yesterday’s “best practice” is co...
Best-in-class companies are using a variety of practices to achieve customer integration Yesterday’s “best practice” is co...
Best-in-class companies are using a variety of practices to achieve customer integration Yesterday’s “best practice” is co...
How to Initiate the Integration Effort © Copyright 1997 The Supply-Chain Council 15536–Module 5
“ Integration” changes focus from internal to external process management <ul><li>Intra-company (Inward Focus) </li></ul><...
Stage 1:  Present overall Supply-Chain Process <ul><li>Educate the customer—assumes internal optimization  has occurred </...
Stage 2:  Share Supply-Chain Configurations <ul><li>Gain an understanding of how the two configurations “interlock” </li><...
Stage 3:  Drive Intercompany Process Improvement <ul><li>Implement with help of a Joint Service Agreement (JSA) </li></ul>...
<ul><li>Review with your customer “their” critical customers  </li></ul><ul><ul><li>Discuss issues, concerns, possibilitie...
Case Study © Copyright 1997 The Supply-Chain Council 15536–Module 5
To illustrate, we will walk through an integration effort between two companies <ul><li>XYZ is a manufacturer of injection...
Stage 1:  XYZ educates ABC on SCOR, and shows them their configuration Customers Suppliers P1  Plan Supply Chain Plan P2  ...
Stage 1:  XYZ will discuss its current SCOR processes and the threads that link them XYZ Coatings XYZ Final Production XYZ...
XYZ then discusses integration opportunities such as planning XYZ Coatings XYZ Final Production XYZ Intermediate Productio...
Stage 1:  XYZ also points out where new perspectives can help reduce cost and internal effort XYZ Coatings XYZ Final Produ...
Stage 1:  Finally XYZ discusses where schedule integration can provide benefits XYZ Coatings XYZ Final Production XYZ Inte...
Stage 1:  XYZ uses its performance scorecard to identify quantitative gaps Example company  performance XYZ balanced “SCOR...
After identifying opportunities, a “to-be” XYZ supply chain is configured XYZ Coatings XYZ’s Suppliers ABC (Customer) Add-...
Stage 2:  XYZ helps ABC define its own supply chain links XYZ ABC’s Customers P2 P3 S1 S3 P4 Sub- Assembly D3 M3, M4 ABC S...
Stage 2:  Likewise ABC identifies supply chain redundancies  P2 P3 S3 P4 Sub- Assembly D3 M3, M4 S3 D2 D2 S1 S1 S1 P2 P3 D...
Stage 2:  ABC also identifies where it can leverage sourcing from a common vendor Independent sourcing from common supplie...
Stage 2:  ABC identifies significant planning integration opportunities P2 P3 S3 P4 Sub- Assembly D3 M3, M4 S3 D2 D2 S1 S1...
Stage 2:  ABC created “to-be” supply-chain configuration sketch S3 Sub- Assembly D3 S3 D2 D2 S1 S1 P4 D1 S1 P3 P1 P4 D1 P2...
Stage 2:  ABC and XYZ work together to compare configurations ABC’s Customers S3 Sub- Assembly D3 S3 D3 D2 S1 S1 P4 D2 S1 ...
Stage 2:  ABC and XYZ use SCOR to identify appropriate best practices for integration
Stage 2:  ABC and XYZ also use SCOR to identify appropriate integration metrics
Stage 3:  Discuss opportunities to integrate ABC — XYZ supply chain <ul><li>Integrate planning processes between the two e...
Stage 3:  Use SCOR to orchestrate improvement discussions with supply-chain partners The results of these discussions are ...
Stage 3:  Discuss mutual benefits <ul><li>Reduced inventories </li></ul><ul><li>Predictable supply to customers </li></ul>...
Stage 3:  Build the plan to address opportunities Benchmark Validate Opportunities Build Value Proposition Negotiate JSA I...
Stage 3:  Build the JSA <ul><li>Agree to performance targets for the manufacturer/customer relationships </li></ul><ul><li...
Next Steps © Copyright 1997 The Supply-Chain Council 15536–Module 5
What you can do to get started New to SCOR  “Prepare” SCOR Veteran  “Integrate” <ul><li>Create your configuration </li></u...
Engaging the customer to participate in an integration effort <ul><li>Understand SCOR supply-chain concepts </li></ul><ul>...
Summary <ul><li>Engage customer in a three-stage integration effort </li></ul><ul><ul><li>Educate in Stage 1 </li></ul></u...
Motivate your customer to use SCOR to integrate with their customer <ul><li>Encourage downstream customers to participate ...
Conclusion Module 5: Fall Conference Dallas, TX November 24, 1997
Upcoming SlideShare
Loading in...5
×

Training Module 5

345

Published on

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
345
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
22
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide
  • 1 1 1
  • 2 2 2 2
  • 3 3
  • 4 3 3
  • 8 7 7
  • 9 8 8
  • 10 9 9
  • 11 10 10
  • 12 11 11
  • 13 12 12
  • 14 13 13 9
  • 15 14 14 10
  • 17 16 17 13
  • 19 18 19 14
  • 22 21 22 18 27
  • 23 22 23 19
  • 24 23 24
  • 25 24 25
  • 26 25 26
  • 27 26 27
  • 28 27 28
  • 29 28 29
  • 30 29 30
  • 31 30 31
  • 32 31 32
  • 33 32 33
  • 34 33 34
  • 35 34 35
  • 36 35 36
  • 37 36 37 44
  • 39 38 39 34
  • 40 39 40 35
  • 41 40 41 36
  • 42 41 42 37
  • 43 42 43 38
  • 44 43 44 9
  • 45 44 45
  • 46 45 46
  • 47 46 47
  • 48
  • 1 1 1
  • Transcript of "Training Module 5"

    1. 1. Using SCOR to Integrate your Customer’s Customer Into Your Supply Chain Module 5: Fall Conference Dallas, TX November 24, 1997
    2. 2. © Copyright 1997 The Supply-Chain Council 15536 The Supply Chain Operations Reference-model (SCOR) has been developed and endorsed by the Supply-Chain Council (SCC), an independent not-for-profit corporation, as the cross-industry standard for supply-chain management SCOR is freely available to all who wish to use the standard reference model The SCC was organized in 1996 by Pittiglio Rabin Todd & McGrath (PRTM) and Advanced Manufacturing Research (AMR), and initially included 69 voluntary member companies Council membership is now open to all companies and organizations interested in applying and advancing state-of-the-art supply-chain management systems and practices Member companies pay a modest annual fee to support Council activities All who use the SCOR model are asked to acknowledge the SCC in all documents describing or depicting the SCOR model and its use All who use SCOR are encouraged to join the SCC, both to further model development and to obtain the full benefits of membership Further information regarding the Council and SCOR can be found at the Council’s Web site, www.supply-chain.com
    3. 3. Agenda <ul><li>Imperative: Why Are Companies “Integrating” Their Supply Chains? </li></ul><ul><li>Benefits of Integrating Supply Chains </li></ul><ul><li>What Does Integration Mean? </li></ul><ul><li>How to Initiate the Integration Effort </li></ul><ul><li>Case Study </li></ul>
    4. 4. Session objectives <ul><li>Demonstrate the imperative for integrating downstream customers into your supply chain </li></ul><ul><li>Introduce a proven approach to perform inter-company supply-chain integration using SCOR </li></ul><ul><li>Enable session participants to use SCOR to facilitate supply-chain integration discussions with customers </li></ul>
    5. 5. Imperative for “Integrating” Supply Chains © Copyright 1997 The Supply-Chain Council 15536–Module 5
    6. 6. Historically, intercompany relationships consisted of one-way, sequential flow of material and information <ul><li>Activities were not coordinated </li></ul><ul><li>Communication flow was interrupted </li></ul><ul><li>“ Full-stream” decision-making was not possible </li></ul>“ Walls” of separation prevented supply-chain optimization Customer Activities Manufacturer Activities Supplier Activities Deliver Make Source Deliver Make Source Deliver Make Source
    7. 7. Competition is driving intercompany integration… <ul><ul><li>“ Establish flexibility to weather unpredictability” </li></ul></ul>Reliability <ul><ul><li>“ Retain our customers and secure new ones” </li></ul></ul>Growth <ul><ul><li>“ Reduce our cost and increase our margin” </li></ul></ul>Margin Product Differentiation <ul><ul><li>“ Develop products that meet customer needs” </li></ul></ul>
    8. 8. … coupled with new “enablers” that make it easier <ul><li>Electronic Commerce—EDI, provides “seamless” links of data </li></ul><ul><li>Joint Service Agreements—provides a relationship of “agreement” </li></ul><ul><li>Value-added services promote collaboration </li></ul><ul><ul><li>Vendor Managed Inventory </li></ul></ul><ul><ul><li>Consignment </li></ul></ul><ul><ul><li>Consumption-based replenishment </li></ul></ul><ul><ul><li>Schedule sharing </li></ul></ul><ul><ul><li>Pull mechanisms </li></ul></ul><ul><li>ERP Systems—potential for better information </li></ul>
    9. 9. <ul><li>Partnering with customers has increased flexibility, and on-time delivery, yielding satisfied customers </li></ul><ul><li>Satisfied customers are responding by awarding more business to “predictable” manufacturers </li></ul><ul><li>Elimination of redundant activities allows redeployment to capture revenue </li></ul>Leaders increase their market share through the integration of customers Manufacturing Activities = Increased Market Share = Customer Customer Customer Manufacturing Activities Customer Activities Customer Activities Manufacturing Activities Satisfied Customers Reliability Growth Margin Product Differentiation
    10. 10. Leaders increase profit margins through customer integration <ul><li>Integration of downstream customers lowers the cost of customer retention </li></ul><ul><li>Alliances with fewer manufacturers and customers have eliminated redundant planning costs </li></ul><ul><li>Elimination of transactions benefits both companies </li></ul><ul><ul><li>Cost </li></ul></ul><ul><ul><li>Time </li></ul></ul><ul><ul><li>Accuracy </li></ul></ul>Reliability Growth Margin Product Differentiation
    11. 11. Leaders stabilize operations through customer integration <ul><li>Predictability of supply is increasing in emphasis </li></ul><ul><li>Availability of upstream and downstream information helps manufacturers to balance production </li></ul><ul><li>Supply-chain integration leads to consistent revenue stream </li></ul>Reliability Growth Margin Product Differentiation
    12. 12. Leaders realize product differentiation through customer integration <ul><li>Manufacturers leverage customers to develop differentiated products and services </li></ul><ul><ul><li>Customized raw materials </li></ul></ul><ul><ul><li>Technical assistance </li></ul></ul><ul><ul><li>Joint development programs </li></ul></ul><ul><li>Early involvement by customers is instrumental in product and service differentiation </li></ul><ul><li>Best-in-class companies reduce R&D cycle times by forging partnerships with customers </li></ul>Survival Is Increasingly Dependent on a Willingness to Integrate With Customers Reliability Growth Margin Product Differentiation
    13. 13. Benefits of Integrating Supply Chains © Copyright 1997 The Supply-Chain Council 15536–Module 5
    14. 14. PRTM’s benchmark studies show that quantifiable benefits can be carried to the bottom line Source: PRTM Integrated Supply Chain 1997 Benchmarking Study Delivery Performance Inventory Reduction Fulfillment Cycle Time Forecast Accuracy Overall Productivity Lower Supply-Chain Costs Fill Rates Improved Capacity Realization 16% – 28% Improvement 25% – 60% Improvement 30% – 50% Improvement 25% – 80% Improvement 10% – 16% Improvement 25% – 50% Improvement 20% – 30% Improvement 10% – 20% Improvement Typical Quantified Benefits from Integrating the Supply Chain
    15. 15. Integrating the supply chain also yields a wealth of qualitative benefits <ul><li>Common supply-chain “language” that facilitates communications </li></ul><ul><li>Mutual awareness of business needs and improvement </li></ul><ul><li>Creation of a virtual “chain of chains” environment </li></ul><ul><li>Improved speed and consistency in decision-making </li></ul><ul><li>Improved working environment </li></ul><ul><li>Superior customer satisfaction from improved responsiveness </li></ul>
    16. 16. What Does Integration Mean? © Copyright 1997 The Supply-Chain Council 15536–Module 5
    17. 17. Planning links suppliers’ and customers’ supply-chain management processes <ul><li>Each intersection of two execution Processes (Source, Make, Deliver) is a “link” in the supply chain </li></ul><ul><li>Planning processes manage these customer-supplier relationships </li></ul>Customer and Supplier Supply Chain Customer and Supplier Customer and Supplier Plan Plan Plan Plan Source Make Deliver “ Manages relationship” with supplier Manages source/make relationship Manages make/deliver relationship “ Manages relationship” with customer
    18. 18. Supply-chain integration is based on “sharing” <ul><li>Shared objectives </li></ul><ul><ul><li>A clear understanding and mutual respect for each other’s objective </li></ul></ul><ul><li>Shared expertise </li></ul><ul><ul><li>Leveraging each other’s skill sets, processes and core competencies </li></ul></ul><ul><li>Shared knowledge </li></ul><ul><ul><li>Leveraging models, frameworks, benchmarking and best practices </li></ul></ul><ul><li>Shared information </li></ul><ul><ul><li>Synchronization of activities (schedules, demand, inventory, marketing data, sales data, design and technology plans) </li></ul></ul><ul><li>Shared experiences </li></ul><ul><ul><li>Communicating experiences which may save time and cost </li></ul></ul><ul><li>Shared responsibility </li></ul><ul><ul><li>Inventory – Cycle times </li></ul></ul><ul><ul><li>Quality – Cost </li></ul></ul>
    19. 19. Customer integration requires joint planning, schedule sharing and rapid replenishment Manufacturer Customer Joint Planning Manufacturing Schedule Sharing Issue Resolution Replenishment Plan Source Make Deliver Plan Source Make Deliver
    20. 20. Best-in-class companies are using a variety of practices to achieve customer integration Yesterday’s “best practice” is commonplace today Practices Results
    21. 21. Best-in-class companies are using a variety of practices to achieve customer integration Yesterday’s “best practice” is commonplace today — Continued Practices Results
    22. 22. Best-in-class companies are using a variety of practices to achieve customer integration Yesterday’s “best practice” is commonplace today — Continued Practices Results
    23. 23. How to Initiate the Integration Effort © Copyright 1997 The Supply-Chain Council 15536–Module 5
    24. 24. “ Integration” changes focus from internal to external process management <ul><li>Intra-company (Inward Focus) </li></ul><ul><li>Each business optimizes inside its own supply chain </li></ul><ul><li>Problems tend to be limited to internal solutions </li></ul><ul><li>Intra-company relationships are identified </li></ul><ul><li>Inter-company (Outward Focus) </li></ul><ul><li>Links the output activities of one company to the input activities of another </li></ul><ul><li>Processes are integrated by macro level planning </li></ul><ul><li>Allows for maximum reduction in cost and cycle time </li></ul>Migration from intra- to intercompany assumes you have optimized internally first Plan Make Deliver Source Make Source Deliver Make Source Deliver Source Supplier Customer Customer’s Customer Suppliers’ Supplier (internal or external) (internal or external) Your Company Deliver
    25. 25. Stage 1: Present overall Supply-Chain Process <ul><li>Educate the customer—assumes internal optimization has occurred </li></ul><ul><ul><li>Identify target customer accounts </li></ul></ul><ul><ul><li>Provide “SCOR” education to customer </li></ul></ul><ul><ul><li>Share “your” supply-chain configuration </li></ul></ul><ul><ul><li>Explain benefits of “interlocking” supply chains </li></ul></ul>
    26. 26. Stage 2: Share Supply-Chain Configurations <ul><li>Gain an understanding of how the two configurations “interlock” </li></ul><ul><ul><li>Setup a session to help your customer configure their supply chain </li></ul></ul><ul><ul><li>Bring them to a similar level of understanding of supply-chain configurations and how to use it </li></ul></ul><ul><ul><li>Connect your configurations with theirs </li></ul></ul>Customer Customer’s Customer
    27. 27. Stage 3: Drive Intercompany Process Improvement <ul><li>Implement with help of a Joint Service Agreement (JSA) </li></ul><ul><ul><li>Discuss redundancies </li></ul></ul><ul><ul><li>Discuss mutual benefits </li></ul></ul><ul><ul><li>Develop plan to address redundancies and optimize benefits </li></ul></ul><ul><ul><li>Develop a JSA to capture “new” responsibilities of both parties </li></ul></ul><ul><ul><li>Implement the JSA </li></ul></ul>JSA
    28. 28. <ul><li>Review with your customer “their” critical customers </li></ul><ul><ul><li>Discuss issues, concerns, possibilities </li></ul></ul><ul><li>Encourage your customer to educate their customer </li></ul><ul><li>Link the entire supply-chain and begin additional discussions to improve entire supply-chain </li></ul>Integrating your customer’s customer should follow a similar but collaborative approach Educate their Customer on SCOR Share Configurations Drive Intercompany Process Improvements Customer Your Company Customer’s Customer Customer Your Company Customer’s Customer JSA
    29. 29. Case Study © Copyright 1997 The Supply-Chain Council 15536–Module 5
    30. 30. To illustrate, we will walk through an integration effort between two companies <ul><li>XYZ is a manufacturer of injection molded plastics </li></ul><ul><ul><li>Produces plastics products in two manufacturing facilities </li></ul></ul><ul><ul><li>XYZ configured their supply chain using SCOR </li></ul></ul><ul><ul><li>XYZ benchmarking assessment identified order fulfillment improvement opportunities </li></ul></ul><ul><ul><li>Senior management launched a major supply-chain improvement effort </li></ul></ul><ul><li>ABC is a primary customer of XYZ </li></ul><ul><ul><li>Two manufacturing plants </li></ul></ul>
    31. 31. Stage 1: XYZ educates ABC on SCOR, and shows them their configuration Customers Suppliers P1 Plan Supply Chain Plan P2 Plan Source P3 Plan Make P4 Plan Deliver Source Make Deliver S3 Source Engineer-to-Order Products S0 Source Infrastructure M0 Make Infrastructure D0 Deliver Infrastructure D3 Deliver Engineer-to-Order Products P0 Plan Infrastructure S1 Source Purchased Materials S2 Source Make-to-Order Products M1 Make-to-Stock - Process M2 Make-to-Order - Process M3 Make-to-Order - Discrete M4 Make-to-Stock - Discrete M5 Engineer-to-Order - Discrete D1 Deliver Stocked Products D2 Deliver Make-to-Order Products
    32. 32. Stage 1: XYZ will discuss its current SCOR processes and the threads that link them XYZ Coatings XYZ Final Production XYZ Intermediate Production Add-It Chemicals P2 P3 M1 D1 S1 P2 P4 P3 M1 D1 S1 D3 S1 P1 P4 P1 S3 D1 D2 Supplier’s Supplier ABC’s Customer XYZ’s Suppliers ABC (Customer) XYZ
    33. 33. XYZ then discusses integration opportunities such as planning XYZ Coatings XYZ Final Production XYZ Intermediate Production Add-It Chemicals P2 P3 M1 D1 S1 P2 P4 P3 M1 D1 D2 S1 D3 S1 P1 P4 P1 S3 D1 XYZ has two distinct internal supply-chain “threads,” indicating significant redundant planning activity Supplier’s Supplier XYZ’s Suppliers ABC (Customer) XYZ ABC’s Customer
    34. 34. Stage 1: XYZ also points out where new perspectives can help reduce cost and internal effort XYZ Coatings XYZ Final Production XYZ Intermediate Production Ad-It Chemicals P2 P3 M1 D1 S1 P2 P4 P3 M1 D1 D2 S1 D3 S1 P1 P4 P1 S3 D1 The final production plant views the intermediate plant as any other supplier Each plant sources independently even though they share a key supplier Supplier’s Supplier XYZ’s Suppliers ABC (Customer) XYZ ABC’s Customer
    35. 35. Stage 1: Finally XYZ discusses where schedule integration can provide benefits XYZ Coatings XYZ Final Production XYZ Intermediate Production Add-It Chemicals P2 P3 M1 D1 S1 P2 P4 P3 M1 D1 D2 S1 D3 S1 P1 P4 P1 Supplier’s Supplier S3 D1 Both plants manufacture to stock The production schedule within the final production plant does not drive the production schedule in the intermediate plant XYZ’s Suppliers ABC (Customer) XYZ ABC’s Customer
    36. 36. Stage 1: XYZ uses its performance scorecard to identify quantitative gaps Example company performance XYZ balanced “SCORcard”
    37. 37. After identifying opportunities, a “to-be” XYZ supply chain is configured XYZ Coatings XYZ’s Suppliers ABC (Customer) Add-It Chemicals D1 D2 S3 P2 P3 S1 S1 P1 S1 M1 M2 P4 XYZ Final Production XYZ Intermediate Production D1 D3 D2 XYZ
    38. 38. Stage 2: XYZ helps ABC define its own supply chain links XYZ ABC’s Customers P2 P3 S1 S3 P4 Sub- Assembly D3 M3, M4 ABC Supply-Chain Configuration S3 D1 D2 M4 D2 S1 S1 S1 P2 P3 D1 P4 ABC
    39. 39. Stage 2: Likewise ABC identifies supply chain redundancies P2 P3 S3 P4 Sub- Assembly D3 M3, M4 S3 D2 D2 S1 S1 S1 P2 P3 D1 P4 ABC also has two distinct internal supply chains without significant integration D1 S1 M4 XYZ ABC’s Customers ABC
    40. 40. Stage 2: ABC also identifies where it can leverage sourcing from a common vendor Independent sourcing from common supplier P2 P3 S3 P4 Sub- Assembly M3, M4 D2 D2 S1 S1 S1 P2 P3 D1 P4 S1 D3 S3 D1 M4 XYZ ABC’s Customers ABC
    41. 41. Stage 2: ABC identifies significant planning integration opportunities P2 P3 S3 P4 Sub- Assembly D3 M3, M4 S3 D2 D2 S1 S1 S1 P2 P3 D1 P4 Planning is not rolled-up across the supply chain D1 S1 M4 XYZ ABC’s Customers ABC
    42. 42. Stage 2: ABC created “to-be” supply-chain configuration sketch S3 Sub- Assembly D3 S3 D2 D2 S1 S1 P4 D1 S1 P3 P1 P4 D1 P2 M3, M4 XYZ ABC’s Customers ABC 31 M4
    43. 43. Stage 2: ABC and XYZ work together to compare configurations ABC’s Customers S3 Sub- Assembly D3 S3 D3 D2 S1 S1 P4 D2 S1 M4 P3 P1 P4 D1 S1 P2 M3, M4 XYZ ABC XYZ Coatings XYZ’s Suppliers Add-It Chemicals D1 D2 S3 P2 P3 S1 S1 P1 S1 M1 M2 P4 XYZ Final Production XYZ Intermediate Production D1 D3 D2 XYZ ABC XYZ ABC
    44. 44. Stage 2: ABC and XYZ use SCOR to identify appropriate best practices for integration
    45. 45. Stage 2: ABC and XYZ also use SCOR to identify appropriate integration metrics
    46. 46. Stage 3: Discuss opportunities to integrate ABC — XYZ supply chain <ul><li>Integrate planning processes between the two entities </li></ul><ul><li>Synchronize the manufacturing strategies </li></ul><ul><ul><li>With integrated planning can a “pull,” make-to-order flow be implemented across the supply chain? </li></ul></ul><ul><li>Create Joint Service Agreements (JSAs) between the two entities </li></ul>
    47. 47. Stage 3: Use SCOR to orchestrate improvement discussions with supply-chain partners The results of these discussions are an agreed to set of supply-chain practices, derived from benchmark performance and industry best practices Process Elements N Process Elements 2 Process Elements 3 Process Elements 1 Current Practices Best Practices Current Performance Desired Performance “ Manufacturer” “ Customer” Process Elements N Process Elements 2 Process Elements 3 Process Elements 1 Current Practices Best Practices Current Performance Desired Performance
    48. 48. Stage 3: Discuss mutual benefits <ul><li>Reduced inventories </li></ul><ul><li>Predictable supply to customers </li></ul><ul><li>Lower costs </li></ul><ul><li>Common goals </li></ul><ul><li>Better on-time delivery </li></ul><ul><li>Efficient tool for communicating and reacting to changes within either entity’s supply chain </li></ul>
    49. 49. Stage 3: Build the plan to address opportunities Benchmark Validate Opportunities Build Value Proposition Negotiate JSA Investigate Tools Pilot Interim Review Pilot Roll-Out
    50. 50. Stage 3: Build the JSA <ul><li>Agree to performance targets for the manufacturer/customer relationships </li></ul><ul><li>Identify and implement mutual best practices </li></ul><ul><ul><li>Understand common practices performed at each company </li></ul></ul><ul><ul><li>Identify redundancies </li></ul></ul><ul><ul><li>Eliminate redundancies and share benefits </li></ul></ul><ul><li>Document a JSA </li></ul>
    51. 51. Next Steps © Copyright 1997 The Supply-Chain Council 15536–Module 5
    52. 52. What you can do to get started New to SCOR “Prepare” SCOR Veteran “Integrate” <ul><li>Create your configuration </li></ul><ul><li>Benchmark </li></ul><ul><li>Identify internal opportunities </li></ul><ul><li>Engage you customer in integration efforts (Stages 1, 2, 3) </li></ul><ul><li>Discuss roles between you and your customer </li></ul><ul><li>Set specific cost sharing and benefit goals </li></ul><ul><li>Motivate your customer to use SCOR to integrate with their customer </li></ul>
    53. 53. Engaging the customer to participate in an integration effort <ul><li>Understand SCOR supply-chain concepts </li></ul><ul><ul><li>Customers will be impressed by your knowledge of supply-chain management </li></ul></ul><ul><li>Initiate your own supply-chain improvement effort </li></ul><ul><ul><li>Configure your supply chain </li></ul></ul><ul><ul><li>Identify opportunities </li></ul></ul><ul><ul><li>Impress the customer by sharing your findings </li></ul></ul><ul><li>Benchmark your supply-chain and encourage customers to do the same </li></ul><ul><ul><li>Participation in benchmarking studies is an easy way to start </li></ul></ul><ul><ul><li>External comparisons provides the impetus for making improvements </li></ul></ul>
    54. 54. Summary <ul><li>Engage customer in a three-stage integration effort </li></ul><ul><ul><li>Educate in Stage 1 </li></ul></ul><ul><ul><li>Understand configurations in Stage 2 </li></ul></ul><ul><ul><li>Plan improvement implementation in Stage 3 </li></ul></ul><ul><li>Use the SCOR model to facilitate the integration sessions </li></ul><ul><li>Define implementable opportunities from linking with the customer’s supply chain </li></ul><ul><li>Develop specific implementation plans, ultimately leading to Joint Service Agreements with customers </li></ul>
    55. 55. Motivate your customer to use SCOR to integrate with their customer <ul><li>Encourage downstream customers to participate in the SCC and use SCOR </li></ul><ul><li>Ensure that your customer’s customer is benchmarking their supply chain </li></ul><ul><li>Offer to conduct a tri-company supply-chain integration effort </li></ul>
    56. 56. Conclusion Module 5: Fall Conference Dallas, TX November 24, 1997
    1. A particular slide catching your eye?

      Clipping is a handy way to collect important slides you want to go back to later.

    ×