Supply chain process evaluation

However, too many people still fail to understand a fundamental point — improvement in performance measurement is driven in large part by implementing improved processes. 

Chapter 22 identified two missions for process improvement (1) process evaluation and (2) process redesign. This chapter describes industry-developed process tools that support the first mission, evaluating supply chain processes. The two tools have assembled best practices in SCM. They are products from two SCM business associations, the Supply-Chain Council and the Council of Supply Chain Management Professionals (CSCMP), formerly the Council of Logistics Management (CLM). The CSCMP, in the cited quotation, supplies the reason for describing these models. 

The SCOR model from the Supply-Chain Council is an industry-developed reference model that covers a broad spectrum of generic supply chain processes. SCOR is an acronym for the Supply Chain Operations Reference Model. Its application requires considerable effort in understanding the model structure and digging out the details that apply to an individual company s situation. 

The CSCMP Process Standards provide a tool for quick self-assessment of generic processes and uses a process structure very similar to that of 

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Reiner G (2005) Customer-oriented improvement and evaluation of supply chain processes supported by simulation. International Journal of Production Economics 96 (3) 381-395... 

This chapter addresses lack of clarity as a root cause for too-high cost in the supply chain. In keeping with the scope of the topic, this chapter is quite long and uses detailed examples. However, most decisions about the supply chain must evaluate cost somewhere in the process. So this chapter describes helpful tools and concepts to achieve clarity in the supply chain cost picture. 

The supply chain design problem in the changing environment through the prism of business-ir ahgmnent is investigated by Medini and Bourey (2012). Their methodology uses SCOR as a reference for evaluation of the supply chain processes, and the five phase procedme for process optimization is elaborated. 

This section provides a high-level view of the recommendations to improve the three supply chain processes at TLC. The comments are related to those recommendations that hold lessons for SCM. Other recommendations, not discussed here, addressed other areas of the company. Each recommendation required TLC managers to evaluate alternatives and set priorities to increase sales and improve cash flow. 

Classify the supply chain macro processes in a firm. All supply chain processes can be classified into three macro processes based on whether they are at the customer or supplier interface or are internal to the firm. The CRM macro process consists of all processes at the interface between the firm and the customer that work to generate, receive, and track customer orders. The ISCM macro process consists of all supply chain processes that are internal to the firm and work to plan for and fulfill customer orders. The SRM macro process consists of all supply chain processes at the interface between the firm and its suppliers that work to evaluate and select suppliers and then source goods and services from them. 

Before starting an improvement process, a clear picture of the supply chain has to be obtained. Therefore, Supply Chain Analysis is a critical success factor. Usually, this analysis will describe the as-is status and the desired to-be status. As a supply chain is built up of different companies for a limited time, it is essential that all partners speak the same language to describe and measure the as-is-status as well as to evaluate the to-be-status. For this purpose, usually a widely accepted model called the SCOR-model is used. 

Product performance as well as issues related to supply chain, marketing, etc., need to be addressed. It may also be necessary to evaluate not only the product but also the process in terms of environmental impact, life cycle assessment and/or sustainability, before it can be launched. 

All of this said, the need exists for supply chain managers in any and all businesses. The real questions become How are we as a company going to do it and What kind of relationships are we going to have with our suppliers Both of these questions have multiple ways of being answered but the best for each situation has to be developed. One of the difficulties that exists is that this process of supply chain management is different for every part of the supply chain. Each part needs to be evaluated and decisions made as to what should be done. 

Information technology can be used to help improve the processes involved in supply chain management. There are many different types of software packages available and the best one for a specific application needs to be evaluated for each company. There is no one-size-fits-all approach that will work well. When purchasing and implementing a software package, the support of top management is a must. The resources for successful implementation must be allocated. Software can enhance the efficiency of processes but the personal relationships need to be mairrtained. 

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