The document discusses value chain analysis and the Supply Chain Operations Reference (SCOR) model. It defines Porter's value chain as including all activities from raw materials to final product/service delivery and support. The value chain categorizes activities as primary (operations, distribution, sales) or support (R&D, HR). SCOR integrates concepts like process reengineering, benchmarking, and measurement into a cross-functional framework. It can help hospitals identify weak areas and implement improvements to ultimately enhance performance. The document then outlines how SCOR describes the key processes in a hospital supply chain at different levels.

1. PRESENTED BY,
GROUP NO 41

2. Value Chain &SCOR model in supply chain
management and its application in hospital
industry
2

3. •Anoof kamal
•Geethu eg
•Shafeeque kk
•Rajalakshmy k
3

4. What is the value
chain?Porter’s definition includes all activities to design,
produce, market, deliver, and support the
product/service.
The value chain is concentrating on the activities
starting with raw materials till the conversion into
final goods or services.
Two categories:
Primary Activities (operations, distribution,
sales)
Support Activities (R&D, Human Resources) 4

5. Value Chain is categorized into types
based on the type of organizations.
*Manufacturing based.
*Service based.
*Both manufacturing and service based.
Types Of
Value Chain
5

6. what is value chain
analysis?
• Used to identify sources of competitive
advantage
• Specifically:
Opportunities to secure cost advantages
Opportunities to create product/service
differentiation
• Includes the value-creating activities of all
industry participants
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7. Value Chain Model
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8. Types of firm
activitiesPrimary activities:
Those that are involved in the
creation, sale and transfer of
products (including after-sales
service)
– Inbound logistics
– Operations
– Outbound logistics
– Sales and marketing
– Service and support
Support Activities:
Those that merely support the
primary activities
– Human resources
(general and admin.)
– Tech. development
– Procurement
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9. Value Chain Model
Firm Infrastructure (General Management)
Human Resource Management
Technology Development
Procurement
Inbound
Logistics
Operation
s
Outbound
Logistics
Sales &
Marketing
Service and
Support
PRIMARY ACTIVITIES
SUPPORT
ACTIVITIES
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10. PRIMARY ACTIVITIES
1.INBOUND LOGISTICS
- concerned with receiving, storing, distributing
inputs (e.g. handling of raw materials,
warehousing, inventory control)
2. OPERATIONS
- Comprise the transformation of the inputs into the
final product form (e.g. Production, assembly, and
packaging)
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11. 3. OUTBOUND LOGISTICS
-involve the collecting, storing, and distributing the
product to the buyers (e.g. processing of orders,
warehousing of finished goods, and delivery)
4. MARKETING AND SALES
-identification of customer needs and generation of
sales.
(e.g. advertising, promotion, distribution)
5. SERVICE
-involves how to maintain the value of the product
after it is purchased.(e.g. installation, repair,
maintenance, and training)
11

12. Value Chain Model
Firm Infrastructure (General Management)
Human Resource Management
Technology Development
Procurement
Inbound
Logistics
Ops. Outbound
Logistics
Sales &
Marketing
Service and
Support
PRIMARY ACTIVITIES
SUPPORT
ACTIVITIES
12

13. SUPPORT ACTIVITIES
1.FIRM INFRASTRUCTURE
The activities such as Organization structure, control system,
company culture are categorized under firm infrastructure.
2.HUMAN RESOURCE MANAGEMENT
Involved in recruiting, hiring, training, development and
compensation.
3.TECHNOLOGY DEVELOPMENT
These activities are intended to improve the product and the
process, can occur in many parts of the firm.
4.PROCUREMENT
Concerned with the tasks of purchasing inputs such as raw
materials, equipment, and even labor.
13

14. Uses Of Value Chain Analysis:
• The sources of the competitive advantage of a firm
can be seen from its discrete activities and how
they interact with one another.
• The value chain is a tool for systematically
examining the activities of a firm and how they
interact with one another and affect each other’s
cost and performance.
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15. • A firm gains a competitive advantage by
performing these activities better or at lower
cost than competitors.
• Helps you to stay out of the “No Profit Zone”
• Presents opportunities for integration
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16. Application of value chain in
health Industry
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17. Value chain of a hospital
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20. SCOR Model
Supply
Chain
Operations
Reference
Model (SCOR)
20

21. 21

22. Quantify the
operational
performance of
similar companies
and establish
internal targets
based on “best-in-
class” results
Benchmarking
Characterize the
management
practices and
software solutions
that result in
“best-in-class”
performance
Best Practices
Analysis
Process Reference
Model
Capture the “as-
is” state of a
process and derive
the desired “to-
be” future state
Business Process
Reengineering
Capture the “as-is” state
of a process and derive
the desired “to-be”
future state
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-
in-class”
performance
Process reference models integrate the well-known concepts of
business process reengineering, benchmarking, and process
measurement into a cross-functional framework
Supply Chain Operations Reference
Model (SCOR)
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23. Best Practical Use of SCOR
• In practical use
SCOR model integrate three basic processes of
Business:
reengineering, benchmarking and process measurement
into a cross-functional framework
• It is helpful to determine the week links in the business
processes.
• It is helpful to implement improvements in the weak
areas of performance
• Improve ultimately performance of Business
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24. Importance of SCOR in business
In today’s business world , each company want to be
the leader in the industry
The company can be a leader by
• making reduction in costs
• Increasing the revenue
• Making improvement in their management
practice
SCOR helps to improve performance by comparing
with the best in the industry
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25. Scope of SCOR Processes
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26. Demand/Supply Planning
and Management
• Balance resources with requirements and
establish/communicate plans for the whole supply
chain, including Return, and the execution processes
of Source, Make, and Deliver.
• Management of business rules, supply chain
performance, data collection, inventory, capital assets,
• transportation, planning configuration, and
regulatory requirements and compliance.
• Align the supply chain unit plan with the financial
plan. 26

27. Sourcing Stocked, Make-to-Order,
and
Engineer-to-Order Product
• Schedule deliveries; receive, verify, and transfer
product; and authorize supplier payments.
• Identify and select supply sources when not
predetermined, as for engineer-to-order product.
• Manage business rules, assess supplier
performance, and maintain data.
• Manage inventory, capital assets, incoming
product, supplier network, import/export
requirements, and supplier agreements. 27

28. • Schedule production activities, issue product,
produce and test, package, stage product, and
release product to deliver.
• Finalize engineering for engineer-to-order
product.
• Manage rules, performance, data, in-process
products (WIP), equipment and facilities,
• transportation, production network, and
regulatory compliance
Make-to-Stock, Make-to-
Order, and Engineer-to-Order
Production Execution
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29. Order, Warehouse ,Transportation, Installation
Management for Stocked, Make-to-Order, and
Engineer-to-Order Product.
• All order management steps from processing customer
inquiries and quotes to routing
• shipments and selecting carriers.
• Warehouse management from receiving and picking
product to load and ship product.
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30. • Receive and verify product at customer site
and install, if necessary.
• Invoicing customer.
• Manage Deliver business rules, performance,
information, finished product inventories
capital assets, transportation, product life
cycle, and import/export requirements
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31. Return of Raw Materials (to Supplier) and Receipt of
Returns
of Finished Goods (from Customer), including
Defective
Products, MRO Products, and Excess Products
• All return defective product steps from authorizing
return; scheduling product return; receiving,
verifying, and disposition of defective product; and
return replacement or credit.
• Return MRO product steps from authorizing and
scheduling return, determining product condition,
transferring product, verifying product condition,
disposition, and request return authorization.
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32. • Return excess product steps including
identifying excess inventory, scheduling
shipment, receiving returns, approving
request authorization, receiving excess
product return in Source, verifying excess,
and recover and disposition of excess
product.
• Manage Return business rules, performance,
data collection, return inventory, capital
assets, transportation, network configuration,
and regulatory requirements and
compliance.
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35. 35

36. Application of SCOR model in
health Industry
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37. Level 2 description of hospital
supply chain
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38. 38

39. SCOR level 3 description: source
specialties.
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