Browse
Log in / Register
Share
The SCOR model is a globally recognized framework that helps businesses analyze, design, and optimize their supply chain operations. By breaking down the supply chain into six core management processes, it provides a standard language for evaluating performance and driving significant improvements in reliability, cost, and agility.
The Supply Chain Operations Reference (SCOR) model is a process reference tool developed by the Association for Supply Chain Management (ASCM). It is not a rigid prescription but a flexible framework that enables companies to understand the complex interplay of activities from sourcing raw materials to delivering finished products to customers. The core strength of the SCOR model lies in its ability to link business strategy, supply chain configuration, and operational performance metrics into a single, integrated view. For managers, this means being able to pinpoint inefficiencies, benchmark against industry standards, and make data-driven decisions for improvement. By adopting a common set of definitions and metrics, organizations can improve communication both internally and with their external partners.
The SCOR model categorizes supply chain activities into six essential processes. These form the foundation for any performance evaluation.
Plan: This foundational process involves balancing aggregate demand and supply to develop a course of action that best meets sourcing, production, and delivery requirements. Effective planning includes demand forecasting, inventory planning, and establishing business rules to measure the entire chain's efficiency. It's about aligning the supply chain's work with the organization's overarching financial goals.
Source: This process encompasses all activities related to procuring goods and services to meet planned or actual demand. Sourcing involves selecting and managing a network of suppliers, negotiating contracts, issuing purchase orders, managing supplier relationships, and assessing supplier performance. It ensures the timely arrival of quality materials at the best possible cost.
Make: This is the production step where raw materials are transformed into finished goods. The Make process includes activities like fabrication, assembly, testing, packaging, and staging. The model acknowledges different production strategies, such as make-to-stock (producing against a forecast) or make-to-order (producing after a customer order is received).
Deliver: Also known as logistics, this process involves managing the order lifecycle—from processing customer orders and managing warehouses to picking, packing, shipping, and invoicing. The Deliver process is critical for ensuring that the right product reaches the right customer at the right time and in the right condition.
Return: The Return process, or reverse logistics, manages the flow of products back from the customer. This includes receiving returned goods for any reason (e.g., defects, overstock, or end-of-life cycle) and handling activities like repair, refurbishment, recycling, or disposal. A well-managed return process is vital for customer satisfaction and asset recovery.
Enable: This cross-functional process supports the management and governance of the entire supply chain. Enable activities include managing business rules, performance data, risk, regulatory compliance, and human resources. It's the "glue" that ensures all other processes are aligned, efficient, and compliant.
The SCOR model uses a hierarchical approach to evaluation, allowing analysis from a high-level strategic view down to granular operational details.
Level 1: The Process Topography. This is the strategic level where the overall performance of the supply chain is defined. Companies establish high-level metrics (e.g., perfect order fulfillment, total supply chain cost) for the six core processes. This level answers the question, "How is our supply chain performing overall?"
Level 2: Process Configuration. At this tactical level, companies configure their specific supply chain by decomposing the Level 1 processes into more detailed process categories. For example, the "Deliver" process can be broken down into "Deliver Stocked Product," "Deliver Made-to-Order Product," etc. This helps in designing the operational flow and assigning resources.
Level 3: Process Element Detail. This is the operational level where individual process elements are defined. It involves setting up detailed activity descriptions, inputs, outputs, and best practices for each task within a process. This granular view is essential for process improvement initiatives like Lean or Six Sigma.
To effectively implement the SCOR model, based on our assessment experience, focus on these key steps:
