The advantages of SCORIn the search for ever-improving returns on investment and market competitiveness, some of the world’s biggest corporations are applying a model known as SCOR to maximize supply chain efficiency. SCOR is the supply chain industry standard model for providing business process modeling data, metrics for evaluating performance management and best practices information based on practitioners’ experience. SCOR, which stands for Supply Chain Operations Reference, is entirely vendor- and technology-independent, and is the only real in-depth reference model for the complete supply chain of all companies.
The model is organized around five key management processes: plan, source, make, deliver and return. Each of these processes is examined on three levels of detail. The first level is strategic – what the company wants from each process area. The second level maps out exactly what is currently happening within each process area. And the third level examines the operational level of the process area, where execution can be altered.
Analyzing data
SCOR generates complex data from a variety of sources, and if it is going to help companies make better decisions, there needs to be a means of portraying this information in a clear and manageable format.
Not long ago, companies made decisions by analyzing traditional reports from their ERP applications and making educated guesses. These decisions had to be continually reviewed, developed and optimized to stay in line with predicted requirements and, as with any inexact science, errors of judgment would often occur.
The addition of a Key Performance Indicator (KPI) analysis tool and integration of a ‘data warehouse’ of this information has created a Business Intelligence environment that provides greater insight for better decision making. IBS software uses these methods to integrate information with strategic value processes, including reviewing and analyzing strategic goals and KPIs for business re-engineering. It enables IBS to deliver solutions that are aimed at increasing operational efficiency, competitive advantage and overall profitability.
SCOR contains metrics that help businesses improve their operations. For companies such as IBS, the issue is how to put this information in a format that customers can read, understand and act upon. Information relevant to SCOR is available in several places, including ERP and other applications, business partners’ systems and benchmark data. The clever part is making this information available in flexible front-end interfaces, enabling ad hoc queries and reporting.
Sourcing and storing
Core data required to produce SCOR metrics come from companies’ main back-office operations. Financial information from sales, purchase and general ledgers is essential. Similarly, data from the warehouse and HR and other external benchmark data all make up the information that is the lifeblood of organizations. Once this information is gathered, it needs to be combined into a common data structure so it can be held in a central data warehouse.
To access the information held in the data warehouse, there needs to be another level of conversion that exploits the data, allowing end users to manipulate it for advanced reporting. This is performed by developing a range of predefined so-called OLAP (online analytical processing) cubes for the different types of SCOR metrics. These cubes compile the core elements of dimensions (customer, item and such) and measures (net amount, quantity and the like) and can carry out the necessary consolidation and calculations required to create visible SCOR KPIs.
The IBS solution
The final stage is to implement tools for creating predefined reports of SCOR metrics information. IBS has developed a solution that delivers this information in clear, intuitive and secure portals. These portals can display graphs, charts, scorecards and tables that show the SCOR metrics data in its most beneficial form and allow key comparisons to be made across all aspects of the business. At the touch of a button, managers can evaluate all aspects of, for example, delivery performance and can make informed decisions on how and where it can be improved.
The SCOR metrics themselves do not determine what changes companies need to make, but they map out where the weak links are. It is then necessary to apply appropriate execution adjustments specific to the particular supply chain. Successful supply chain management is about consistent scrutiny, getting real-time information so you can react to less-than-optimal performance. IBS can help companies gather, understand and manipulate information to gain the competitive edge needed in the tough world of modern business.
Text: Bengt Jensfelt, BI Product Manager, IBS AB
Illustration: Alan Adler
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