Strategic Supply Chain Management The 5 Diciplines for Top Performance Core 2 Develop An End to End Process Architecture

1. Core Dicipline 2 :
Develop an End-to End
Process Architecture
Presented by :
Freedo Syafitra (122131038)
Selvi (122131099)
Siska Suryanto (122131101)
Tugas Manajemen Logistik dan Rantai
Pasokan
Dosen Pembimbing :
Dr. Dadang Surjasa, Ssi, MT
Program MM Trisakti
2015
STRATEGIC SUPPLY CHAIN MANAGEMENT
The 5 Diciplines for Top Performance

2. Core Dicipline 2
Develop an End-to End Proses
Architecture
Four Tests of
Supply Chain
Architecture
Strategic
Fit
End To End
Process
Simplicity
Integrity
Architectural
Toolkits
The Top Three
Level of The
Scor Model
SCOR
Level 1
SCOR
Level 2
SCOR level
3
Five Process
For End to End
Supply Chain
Management
Plan
Sources
Make
Deliver
Return
Next
Generation
Processs
AVON

3. Four Primary
Components on the Process Architecture
◆ Proses supply chain (plan, source, make deliver, dan
return) dan bagaimana proses tersebut berhubungan
satu sama lain
◆ Interaksi proses supply chain dan core interprise
processes
◆ Aplikasi pendukung proses supply chain, termasuk data
dan indikator kinerja untuk process execution and control
◆ Integrasi aplikasi termasuk specific data dan frequency of
communication

5. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE

6. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE
Persyaratan Architecture memenuhi Strategic Fit :
◆ The value of new practices diukur sebelum diintegrasikan
ke dalam the supply chain architecture.
◆ New business practices diprioritaskan berdasarkan
kemampuannya untuk memajukan supply chain strategy.
◆ The supply chain architecture reviewed regularly agar
memastikan keselarasan dengan arah current strategic.

7. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE
Critical need to improved customer service and working capital
Total Supply Chain
Management
Order Fulfillment
Lead Time
Cash-to-Cash
Cycle Time
On-time Delivery
(to Commit Date)

8. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE

9. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE

10. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE
Persyaratan Architecture memenuhi End to End Focus :
◆Sistem informasi dan proses yang terintegrasi didalam
dan luar perusahaan (mencapai key suppliers and
customers).
◆Mengoptimalkan supply chain resources seluruh
perusahaan seperti kapasitas and inventory dan
dengan key suppliers and customers.
◆ Standard metrics, tujuan perusahaan, performance
visibility and management dinfokan ke seluruh
perusahaan dan dengan key suppliers and customers.

11. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE
Supply Chain
Configuration
Product and Service
Proliferation
Process and Systems
Inconsistency
Overautomation

12. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE
Persyaratan Architecture memenuhi Simplicity Test :
◆ Standarisasi supply chain process architecture .
◆ Kompleksitas produk dan jasa serta biaya terkait
diukur dan dikelola.
◆ Mendefinisikan dan memenuhi standar komponen
dan material.
◆Mereview dan menyederhanakan konfigurasi
physical supply chain (warehouses, order desks,
factories, supplier locations, distribution centers).

13. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE

14. Strategic Fit
End To End
Process
Simplicity Integrity
FOUR TESTS OF SUPPLY CHAIN ARCHITECTURE
Persyaratan Architecture memenuhi Integrity :
◆ Integrasi aplikasi yang didefinisikan dalam supply
chain process architecture dan isu dampak integrasi
aplikasi pada kinerja perusahaan.
◆ Dokumentasi proses tiap level supply chain
architecture dengan deskripsi data yang jelas pada
tiap proses
◆ Kualitas data diukur dan dikelolan dengan
kepemilikan yang jelas untuk data creation and
maintenance.

15. • Supply chain  Plan, Source, Make, Delivery
• Supply Chain Architecture  mendeskripsikan bisnis
proses dan interaksi tiap bisnis proses
• Matriks Supply Chain Performance
described unambiguosly, communicated
consistenly, redesigned to achieved competitive
advantage, measured, managed, controlled, refine to
meet a specific purpose
• Supply Chain Operations Reference –model (SCOR)
ARCHITECTURAL TOOLKITS

16. SCOR
Manfaat SCOR :
menyediakan framework dan standarisasi
terminologi agar organisasi dapat terintegrasi dengan
management tools seperti business process
reengineering, benchmarking dan best practice
analysis
SCOR :
SCOR level 1 (proses)
SCOR level 2 (subproses)
SCOR level 3 (aktivitas)
SCOR level 4  detailed workflow level tasks
Translate business strategy into a supply
chain architecture ddsigned to achieve
spesific business objective

18. • Fokus pada 5 proses utama supply chain (plan,
source, make, deliver, return)
• Standarisasi proses, information system costs,
menentukan kemampuan perusahaan dalam
implementasi praktek bisnis tertentu.
THE TOP THREE LEVELS OF THE SCOR MODEL
SCOR Level 1 SCOR Level 2 SCOR Level 3

19. • Review pilihan proses supply chain dan
mengkonfirmasi bagaimana proses supply chain align
dengan infrastruktur (lokasi fisik dan teknologi
informasi).
• Configuration level  mengembangkan dan
mengevaluasi high level option untuk proses supply
chain  flavors of plan, source, make, deliver, return
THE TOP THREE LEVELS OF THE SCOR MODEL
SCOR Level 1 SCOR Level 2 SCOR Level 3

20. • Process element level
• Complete supply chain architecture dengan
menambahkan operational detail
• Mengetahui praktek bisnis spesifik, associated metrics
dan panduan sistem yang diperlukan untuk support
process.
• Lean principles  reducing process and information
systems complexity, creating better linkages between end
customer demand and end production, eliminating similar
activities, conducted in multiple locations and reducing
wait time and associated inventory, lead times
THE TOP THREE LEVELS OF THE SCOR MODEL
SCOR Level 1 SCOR Level 2 SCOR Level 3

21. THE TOP THREE LEVELS OF THE SCOR MODEL
SCOR Level 1 SCOR Level 2 SCOR Level 3

23. FIVE PROCESSES FOR END TO END SUPPLY CHAIN MANAGEMENT
PLAN SOURCE MAKE DELIVER RETURN
Use Timely, Accurate
Information
Focus Resources On
Business Priorities
Aim For Simplicity
Integrate All Supply
Chain Requirement
Create Explicit
Actions And
Accountabilities
Plan input merupakan informasi demand, supply and
supply chain resources sehingga memungkinkan
pengambilan keputusan yang lebih baik dan memandu
semua kegiatan supply chain yang terkait dengan
eksekusi proses (source, make, deliver, and return)

24. FIVE PROCESSES FOR END TO END SUPPLY CHAIN MANAGEMENT
Aim For The Lowest
Total Cost Of
Ownership (TCO)
Set Procurement
Strategies According
To Category
Maintain An
Enterprisewide
Focus
Measure And
Manage
Performance
PLAN SOURCE MAKE DELIVER RETURN
Menerapkan plan yang dihasilkan plan source,
supply chain sources semua material dan jasa yang
diperlukan, melakukan kegiatan operasional
purchasing, scheduling, receiving, inspecting dan
authorizing supplier payment

25. FIVE PROCESSES FOR END TO END SUPPLY CHAIN MANAGEMENT
Focus On Business
Priorities
Aim For Speed And
Flexibility, Not Just
Low Costs
Set And Monitor
Quality Standards
Synchronize All
Manufacturing
Activities
PLAN SOURCE MAKE DELIVER RETURN
The supply chain make process mengubah resource
menjadi produk dan jasa sesuai dengan spesifikasi
yang ditentukan dan regulatory

26. FIVE PROCESSES FOR END TO END SUPPLY CHAIN MANAGEMENT
Balance Service
With The Cost To
Serve
Cut Costs And Time
With Straight-
through Processing
Set Up End-to-end
Tracking And
Traceability
Manage Data For
Ongoing Accurancy
And Timeliness
PLAN SOURCE MAKE DELIVER RETURN
Proses delivery dimulai dari menerima order
customer termasuk semua kegiatan yang diperlukan
untuk memenuhi order tersebut, seperti menyediakan
price quote untuk mengumpulkan payment dari
customer. Deliver make order visible to source dan
make for execution, memastikan keperluan customer
terkomunikasi dengan jelas. Semua aktivitas
warehousing, transportation, dan distribution juga
termasuk deliver .

27. FIVE PROCESSES FOR END TO END SUPPLY CHAIN MANAGEMENT
Create a Distinct
Supply Chain For
Return
Feed Back Return
Information Quickly
Base Return Policies
On Total Cost Of
Return
Maximize Revenue
Opportunities
PLAN SOURCE MAKE DELIVER RETURN
Return merupakan reverse supply chain
process yang memiliki karakteristik dan
specific requirements yang berbeda dari
forward supply chain.

28. NEXT GENERATION PROCESSES

29. CASE STUDY
A
V
O
N
P
R
O
F
I
L
E
CALLING ON
CUSTOMERS
COST-
EFFECTIVELY

30. AVON HISTORY
1886 David H McConnell mendirikan sebuah perusahaan The
California Perfume Company (BPK).
1892 The California Perfume Company (BPK) berganti nama
menjadi Avon yang berkantor di New York City.

31. Douglas R. Conant
Chairman

32. TRUST
RESPECT
HUMILITY
INTEGRITY
BELIEF
AVON
VALUE

33. Principles That Guide Avon
 To provide individuals an opportunity to earn in support of
their well-being and happiness.
 To serve families throughout the world with products of the
highest quality backed by a guarantee of satisfaction.
 To render a service to customers that is outstanding in its
helpfulness and courtesy.
 To give full recognition to employees and Representatives, on
whose contributions Avon depends.
 To share with others the rewards of growth and success.
 To meet fully the obligations of corporate citizenship by
contributing to the well-being of society and the environment
in which it functions.
 To maintain and cherish the friendly spirit of Avon.

34. AVON PRODUCT
KOSMETIK
PARFUM
PERAWATAN KULIT
LINGERIE
ACESORIES

35. AVON in the World

36. A GROWING BUSINESSS
AND GROWING PROBLEMS
• Ketidaksesuaian selling cycle dan supply chain cycle
• Short selling cycle  setiap 3 minggu dengan direct
sales
• Cycle time produksi 12 minggu.
• Program Campaign  meningkatkan penjualan
melebihi target  marketing mendesak
manufacturing untuk memproduksi produk tidak
sesuai dengan rencana produksi bahkan mengganti
produk yang akan diproduksi sehingga meningkatkan
changeover costs.

37. • Product slow moving  meningkatkan level inventory
hingga 150 hari  overstock  meningkatnya
inventory costs.
• Distribusi produk ke banyak negara, menyebabkan
printed packaging dicetak dengan berbagai bahasa
dan meningkatnya varian produk menyebabkan
meningkatkan lead time supplier untuk menyediakan
packaging  manufaktur harus memesan packaging
sebelum mengetahui sales volumes. Akibatnya order
di negara tertentu tidak dapat terpenuhi karena
ketidaksesuaian persediaan packaging dengan negara
pemesan.

38. RETHINKING THE SUPPLY CHAIN
• Centralized Planning Function  database yang dapat
mengetahui sales trend dan inventory
• Install Manugistic  supply chain planning dan
scheduling system  support integrasi planning dan
coordination di seluruh Eropa.
• Meredesign supply chain dengan model SCOR dengan
mengidentifikasi plan, source, make and delivery
• Meningkatkan kapasitas produksi dengan melakukan
konsolidasi  mendirikan Plant di Polandia walaupun
sudah memiliki Manufacturing Plant di Germany 
menurunkan labor cost dan delivery cost

39. END to END VISIBILITY
• Membeli plain bottle dengan variasi 5-6 bahasa 
memenuhi kebutuhkan pasar dan meningkatkan
kepuasan customer
• One centralized warehouse yang menampung hasil
produksi 2 manufaktur (Jerman dan Polandia) untuk
mendistribusikan produk ke semua cabang.
• Melakukan standarisasi packaging dan mengurangi
diferrensiasi jenis ukuran dan bentuk bottle sehingga
menurunkan production cost dan meningkatkan
efisiensi. Supplier dapat dengan cepat memenuhi
order kemasan karena dapat dilakukan dalam line
produksi yang sama.

40. COLLABORATING WITH SUPPLIERS
• Mengubah sourcing strategy  mengurangi jumlah
supplier, konsep supplier partnerships dan fokus pada
lowest total cost dibanding lowest prices.
• Inventory di supply oleh supplier yang dekat dengan
lokasi manufaktur  harga per unit lebih mahal
• Keuntungan supplier partnerships  supplier lebih
flexible dan responsif, menurunkan total cost, bekerja
sama dengan supplier untuk mendesain kemasan
yang cost effective dan mengidentifikasi inefisiensi
dalam proses manufacturing.
• Supplier dapat mengakses Web-based system untuk
mengetahui production schedules

41. BUILDING ON SUCCESS :
COLLABORATIVE DESIGN
• Mengadakan collaborative design workshop yang
terdiri dari supplier, perusahaan desain, perwakilan
team marketing and supply chain untuk mendesain
konsep new package yang menarik dari sisi
marketing dan design perspective tetapi mengurangi
biaya di setiap tahapan supply chain.

42. REORGANIZATION –AND THE
CHANGE MANAGEMENT CHALLENGE
• Reorganisasi dan restrukturisasi 4 proses utama plan,
source, make , deliver.
• Define primary responsibilities, shared responsibilities
and the supporting metrics.
• Menginfokan redesigned structure, accountabilities, new
metric performance dan menyusun KPIs secara jelas
• Meningkatkan skills karyawan dengan training dan
edukasi
• Integrasi Web Based Sytem untuk mengatasi complexity
of the business

43. CONCLUSION
• Rethinking supply chain meningkatkan efisiensi,
mengurangi biaya dan meningkatkan pendapatan
hingga $50 juta per tahun/two gross margin points.
• Lebih dari 50% keberhasilan Avon karena adanya
kerjasama dengan supplier (the smaller supplier base,
local sourcing strategy, supplier partnership and
collaboration)
• Avon Europe lebih mudah untuk mengelola
perusahaan karena adanya streamline organization,
upgraded skills, simplified processes dan right metrics.

44. Four Tests of
Supply Chain
Architecture
Strategic
Fit
End To End
Process
Simplicity
Integrity
Architectural
Toolkits
The Top Three
Level of The
Scor Model
SCOR Level
1
SCOR
Level 2)
SCOR level
3
Five Process
For End to End
Supply Chain
Management
Plan
Sources
Make
Deliver
Return (v)
Next
Generation
Processs
Develop an End-to End Proses Architecture
 AVON Profile: Calling on Customers Cost
Effectively

45. REFERENCE
Cohen, Shoshanah and Joseph Roussel. 2005. Strategic
Supply Chain Management The 5 Disciplines for Top
Performance. New York : McGraw-Hill
http://www.avoncompany.com/