New Member Introduction

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New Member Introduction

• How to Define, Align, and Excel Your Supply Chain
  
• January 2008

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Agenda

• The need for superior supply chain management
• Supply chain issues facing companies today
• The role of the SCOR model in optimizing supply
  chain performance
• What is SCOR?
• How has it helped companies improve their supply
  chains?
• The Supply-Chain Council A resource for supply
  chain excellence
• Your Membership Stages of Development
• Appendix The SCC Toolkit

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THE NEED FOR SUPERIOR SUPPLY CHAIN MANAGEMENT
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What Keeps You Up at Night?
Stock Market Volatility, Oil Prices, Labor,
Political Instability, Security
Reducing Inventory/ Working Capital/ Asset
Management
Reducing Total Supply Chain Costs
Supply Chain Resiliency Sustainability Risk
Management Green
Competing in a Global Market
Providing Superior Consistent Customer Service
While Increasing Revenue Margin
Business As Usual Has Been CancelledNow What?
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Superior Supply Chain Management (SCM) has Long
Been a Source of Competitive Advantage
of Revenue
Best-in-class Companies Outperform Their Median
Competitors with a 50 Cost Advantage
Source PRTM/The Performance Measurement Group
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But SCM is Paramount in Times of Economic
Uncertainty

• In 2007, US business logistics costs rose to an
  all time high of 1.4 trillion (10.1 of US
  nominal Gross Domestic Product ) 3
• Supply-chain generally accounts for between 60
  and 90 of all company costs1
• A 2 improvement in process efficiency for
  supply-chain processes has 3000 - 5000 the
  impact of a 2 improvement in efficiency for IT
  HR Finance1 Sales

1 Exclusive of Financial Services companies2
Source Hoovers 2006 Financial Data, Supply-Chain
Council 2006 SCM Benchmark data on SCM cost for
discrete process industries 3 CSCMP 19th Annual
State of the Logistics Industry
Focused initiatives in Supply Chain Management
can result in 30-35 cost reductions, liberation
of working capital, and revenue increases of 3-5!
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And SCM Improvement Creates Shareholder Value
The Supply Chain Impacts . . .
All Financial Metrics . . .
Shareholder Value
Liberate Working Capital

• Improve customer service and response
• Optimize inventory flow, utilization
  productivity

Improve Capital Efficiency
Reduce Fixed Capital

• Best-in-class customer relationships
• Differentiated service capabilities

Increase Shareholder Value
Increase Revenue and Margin
Increase Profit

• Best-in-class strategic supplier partnerships
• Leverage of outsourcing of business processes
• Unique supply chain models

Optimize Cost Model
Effective Supply Chain Management can increase a
Return on Capital Employed by 30 and More!
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THE ROLE OF THE SCOR MODEL IN OPTIMIZING SUPPLY
CHAIN PERFORMANCE
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What is SCOR?

• SCOR is a supply chain process reference model
  containing over 200 process elements, 550
  metrics, and 500 best practices including risk
  and environmental management
• Organized around the five primary management
  processes of Plan, Source, Make, Deliver and
  Return
• Developed by the industry for use as an industry
  open standard - Any interested organization can
  participate in its continual development

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SCOR helps to map and improve the end-to-end
supply chain

• From suppliers supplier to customers customer

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SCOR Processes Five Levels of Decomposition
EDI
S1Source Stocked Product
Supply-Chain Source
S1.2Receive Product
XML
Standard SCOR definitions
Company/Industry definitions
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SCOR Performance Metrics Mapping the Impact of
Specific Activities on Each Key SCM Metric

• Standard Strategic (Level 1) Metrics

Customer
Internal
upside and downside adaptability metrics
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SCORmark Benchmarking Diagnosing the Areas Most
in Need of Improvement
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How Does SCOR Help Improve Supply Chains?

• SCOR can be used to describe supply chains that
  are very simple or very complex using a common
  set of definitions and enabling a common
  understanding
• It helps companies
• Compare the performance of supply chain and
  related operations within their company or
  against other companies
• Determine what processes to improve and by how
  much to improve them
• Guide the consolidation of internal supply chains
  (which results in significant cost reductions
  from eliminating duplicative assets)
• Create standard processes and common information
  systems across business units (which generates
  major cost savings, cycletime and quality
  improvements)
• Create a common scorecard by which customers can
  measure their performance and by which SCC
  members can measure suppliers performance (which
  can lead to major cross-organizational process
  improvements).

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SCC membership accelerates a companys use of
and benefits from SCOR and related models
Reference models, benchmarking, tools research
and help from SCOR experts
Training, certification, career development and
volunteer opportunities
Chapters, events and forums to share SCOR and
supply chain knowledge and experience
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Member benefits Resources
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Member benefits Capability Development
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Member benefits Knowledge Networks
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The Member Journey
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1 Learning
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1 Learning Tools
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2 Piloting

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2 Piloting Tools
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3 Deploying
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3 Deployment Tools
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3 Deployment Tools
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4 Integrating

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4 Integration Tools
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4 Integration Tools
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5 Renewing
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5 Renewing
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5 Renewing
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TOOLS SUMMARY
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Member Benefits
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SCOR
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Training
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Certification
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Benchmarking
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Events
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Experts
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Publication
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Research
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Chapters
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Forums
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Tools
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Career
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Many Thanks

• info_at_supply-chain.org