Supply Chain Excellence: A Handbook for Dramatic Improvement Using the SCOR Model - Hardcover

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PETER BOLSTORFF is President and CEO of SCE Limited, which supports supply chain performance through education, coaching, and process expertise.

ROBERT ROSENBAUM, an award-winning journalist, is founder and President of The MarketFarm, which specializes in leveraging technical content. He was the founding editor of the former Supply Chain Technology News.

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The gold standard guide to adopting the superior, cross-industry methodologies developed by the Supply Chain Council for achieving operational superiority—the SCOR, DCOR, and CCOR Models—Supply Chain Excellence, now updated in a third edition, is a concise, practical instruction manual to doing supply chain correctly.

Now adapted for use in an SAP environment, in global enterprises, and by small businesses, the third edition features a highly compressed timeline for using the SCOR (Supply Chain Operations Reference) framework to plan and execute supply chain improvement. You’ll learn how to:

• Implement changes to achieve sustainable competitive advantage

• Define business opportunities along the supply chain by conducting the proper competitive analysis

• Gain buy-in by educating your organization about supply chain improvement

• Achieve a significant return on investment

Featuring new examples from roughly 30 additional projects, the book identifies the most common contributors to supply chain misalignment, refines the use of the scorecard for better process analysis, extends the approach to encompass implementation and strategy, and quantifies the financial value of supply chain improvement to demonstrate its importance in achieving lasting competitive advantage.

If you want to keep your sales, manufacturing, distribution, and inventory moving in perfect synchronization, you need a flawless, repeatable supply chain improvement approach that maximizes process efficiency and eliminates dysfunction. Thoroughly revised to reflect the latest thinking and most up-to-date strategies, the third edition of Supply Chain Excellence is an unparalleled guide for implementing best practices in supply chain management.

Praise for Previous Editions of Supply Chain Excellence:

“If you are involved in supply chain management, read this book!”— Paul Harmon, Executive Editor, Business Process Trends

“The genius of the Supply Chain Operations Reference (SCOR) definition of supply chain management is that it simplifies the complexities of SCM down to five simple terms that everybody can agree on: plan, source, make, deliver, return.” — Industry Week

“Supply Chain Excellence is a superb offering for organizations encountering their first supply chain difficulties, or for use as a detailed, practical how-to manual for properly managing a supply chain. It provides valuable guidance for forming a project team, gaining top management commitment, conducting environmental analyses, and managing a critical-to-quality, strategically driven project with the potential for huge payoffs.” — Quality Progress

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For any supply chain, misalignment—the failure of all elements to move as one—can mean poor service, high inventory, unexpected costs, constrained growth and profits, and a loss of market share. In a world that’s becoming more global, supply chain improvement is a more crucial skill than ever. Even if you operate a smaller business, having a proven, reliable system for keeping your supply chain running smoothly is essential if you want to keep up with the competition.

A hands-on guide to achieving operational superiority, Supply Chain Excellence shows you, step-by-step, how to adapt the field-tested processes of the Supply Chain Council in your own organization.

Thoroughly updated and now featuring examples from close to 100 projects, Supply Chain Excellence shows you how to:

• Gain internal support by educating employees and executives

• Put hard numbers to the financial value of change

• Conduct the proper competitive analysis to define business opportunity

• Align strategy, product flow, work flow, information flow, and system business requirements to focus on the right changes

• Maximize your use of existing technology

• Optimize Enterprise Resource Planning in your organization

• Streamline your process analysis effort and develop a sustainable supply chain scorecard

Now featuring a compressed project timeline conducive to global and small-business use—and guidance for applying SCOR processes in an SAP environment—the book includes SAP screen captures, sample deliverables, summaries of tasks, and key required executive behaviors, as well as helpful graphics and diagrams. Supply Chain Excellence gives you all the practical tools you need, whether you’re trying to improve the performance of an existing supply chain system or implement a new one.

Supply Chain Excellence has long been the go-to resource for doing supply chain right. Comprehensive, practical, and utterly up-to-date, the third edition is your passport to utilizing the supply chain strategies that have been proven to work time and time again.

PETER BOLSTORFF is President and CEO of SCE Limited (scelimited.com), which supports supply chain performance through education, coaching, and process expertise. An internationally recognized speaker, educator, consultant, and author, he is a former technical chair and two-term member of the Board of Directors with the Supply Chain Council and has been involved with the development of the SCOR model since its inception in 1996.

ROBERT ROSENBAUM is an award-winning journalist with a specialty in manufacturing and supply chain management, and founder and President of The MarketFarm, which specializes in leveraging technical content. A partner in Supply Chain Excellence Education, the training arm of SCE Limited, he was the founding editor of the former Supply Chain Technology News.

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INTRODUCTION

During dinner at a recent supply chain conference, a senior execu-

tive asked me about the latest thinking on how to improve global

supply chain performance. Without hesitation I whispered, ‘‘Have

you tried the sardine strategy yet?’’ Anticipating the puzzled look, I

continued: ‘‘For schooling fish, staying together is a way of life. Fish

in a school move together as one.’’

For schooling fish, the ‘‘move as one’’ trait is innate. Separation

means likely death. For global supply chains, misalignment—failure

to move as one—means poor service, high inventory, unexpected

costs, constrained growth and profits, and loss of market share.

The purpose of this book is not to convince anyone of the impor-

tance of supply chain management (SCM). That case has been

well made many times in many industries since the first edition of

Supply Chain Excellence was published in 2003. Even then, only the

first two paragraphs of the book’s introduction argued the ‘‘why’’ of

SCM. The rest was about the ‘‘how.’’

While using the methodology of this book on roughly 100 supply

chain projects around the world, ‘‘how’’ has been further refined

into a series of processes to achieve the highest levels of supply

chain alignment: moving as one.

Here are the 15 most common contributors to supply chain misalign-

ment. Which ones are relevant to you?

Fifteen Common Causes of Misalignment

1. Lack of a Technology Investment Plan

A chief information officer deflected pressure to install the latest and

greatest advanced planning system—making the case that simply

having state-of-the-art tools was not a good enough reason to put

her entire company into the kind of upheaval that such implementa-

tions create. As she watched the rapid evolution of web-based appli-

cations, event management tools, and demand-driven advanced

planning systems, she found herself without a clear technology in-

vestment plan that supported the company’s business strategy.

2. Little or No Return on Investment (ROI)

A company bought its Enterprise Resource Planning (ERP) package

during the vendor’s end-of-quarter push to meet sales goals. The

deal included all the latest add-ons—things like customer relationship

management, transactional processing, advanced supply chain

planning, event management, and web portals providing self-service

for customers and suppliers. Now the executive team is looking for

an answer to a deceptively difficult question: When will a return on

investment start to show up in the earnings statement?

3. Isolated Supply Chain Strategies

Three executive vice presidents—for sales, marketing, and opera-

tions— assembled their own well-articulated strategies for developing

supply chain competence within their departments. Then they invested

in application technology, manufacturing processes, and product de-

velopment— all with measurable success. Now what’s missing is a

comprehensive blueprint that combines their individual efforts to drive

profit and performance across the entire company.

4. Competing Supply Chain Improvements

A company’s top executive for SCM assembled a dozen of his

brightest managers for a structured brainstorming process—resulting

in a list of 45 high-priority projects. But when the managers began

implementation, the results were not encouraging. General managers

were being asked to support multiple initiatives that used many

of the same financial, human, and technical resources. Goals seemed

in conflict. They needed to align their objectives and prioritize projects

to make good use of the available resources.

5. Faulty Sales and Operations Planning

The vice president of operations for one of the companies had serious

cash-to-cash problems and declining customer satisfaction—all

resulting from raw materials shortages, mismatched capacity, poor

forecasting, and inventory buildup. The challenge was to address the

planning and forecasting issues and put the balance sheet back in

shape.