Supply Chain Management

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CONTENTS

1. SUPPLY CHAIN MANAGEMENT 2

1.1 Introduction 2

1.2 Overview 2

2. COMPANY PROFILE - FOCUS POINT 4

3. PERFORMANCE IN SUPPLY CHAIN MANAGEMENT 5

4. CHARACTERISTIC OF GOOD MEASURES 9

4.1 Question to Determine Good Metric 10

4.1.1 Is Quantitative 10

4.1.2 Is Easy to Understand 10

4.1.3 Encourages Appropriate Behaviour 10

4.1.4 Is Visible 10

4.1.5 Is Defined and Mutually Understood 11

4.1.6 Encompasses Both Outputs and Inputs 11

4.1.7 Measures Only What Is Important 11

4.1.8 Is Multidimensional 11

4.1.9 Uses Economies of Effort 12

4.1.10 Facilitates Trust 12

5. PERFORMANCE CATEGORIS 12

6. SCOR MODEL 13

6.1 Benefits of using the SCOR Model 14

6.2 The Process Modeling Pillar 14

6.3 SCOR Process Framework 17

6.4 The Performance Measurements Pillar 18

6.5 The Best Practices Pillar 19

7. CONCLUSION 23

1. SUPPLY CHAIN MANAGEMENT

1.1 Introduction

Supply Chain Management is one of the most important strategic aspects of any business enterprise. Decisions must be made about how to coordinate the production of goods and services, how and where to store inventory, whom to buy materials from and how to distribute them in the most cost-effective, timely manner.

Figure 1

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Consider a typical manufacturer. The supply chain is made up of many interrelated firms (Figure 1). There are parts suppliers, component suppliers and subassembly suppliers. Further up the chain are the suppliers’ suppliers, finally reaching the raw materials suppliers at the far end of the chain.

Going downstream, back through the producing firm, the supply chain continues through the warehousing and distribution channels and then through the retail channels, ending with the consumer.

The supply chain encompasses all activities associated with the flow and transformation of goods and services from the raw materials stage (at one end of the supply chain) through to the customer (at the other end of the chain),...