THE STUDY OF SUPPLY CHAIN OPERATIONAL REFERENCE
NCRD’s Business Review : e-Journal, Volume 3, Issue 1 (Jan-Dec 2018)ISSN: 2455-0264THE STUDY OF SUPPLY CHAIN OPERATIONAL REFERENCE(SCOR) MODELDr. Sandeep J. Ponde,Associate Professor,NCRD’s Sterling Institute of ManagementStudies, Navi MumbaiDr. Arjita Jain,Professor,NCRD’s Sterling Institute of ManagementStudies, Navi MumbaiAbstract: In today’s business world the Supply Chain Management (SCM) plays the key role inall the parts of business for satisfy the demand and supply of customer. The aim of every supplychain should be to maximize the overall value generated. In this increasing competition and fastchanges in markets has put supply chains in pressure. Thus in order to help organizations toovercome this pressure, supply chain council has suggested Supply Chain Operations Reference(SCOR) model. This is a step by step procedure which provides a unique framework consisting offive processes (plan, source, make, deliver and return) with process type, processes categoriesand decompose processes as three levels which help in implementing it in an organization,leading to path of improvement.This paper describes the evolution of various definitions of supply chain and SCOR Model.Supply Chain Management basically looks into the interrelationship and inter- linkages betweenvarious functions, processes and chain members and analyses the impact of their interaction onvalue additions and profit maximization as well as Supply Chain Operations Reference (SCOR)model through the literature review and the paper ends with a conclusion.Keywords: Supply Chain Management, Evolution of Supply Chain Management SCOR Model,Supply Chain.INTRODUCTIONA supply chain consists of all parties involved, directly or indirectly, in fulfilling a customerrequest. The Big umbrella supply chain includes the manufacturer and suppliers, along withtransporters, warehouses, retailers, and even customers.Page 1
NCRD’s Business Review : e-Journal, Volume 3, Issue 1 (Jan-Dec 2018)ISSN: 2455-0264Within each organization, such as a manufacturer, the supply chain includes all functionsinvolved in receiving and filling a customer request. Today’s supply chain is cable to handle anew product development, marketing, operations, distribution, finance, and customer service.According to Christopher (1994) a supply chain is “network of organizations that are involved,through upstream and downstream linkages, in the different processes and activities thatproduces value in the form of products and services in the hands of the ultimate rCustomerFlow of goodsFlow of information and fundsFig. The Basic Supply Chain Block Digaram (Sunil Chopra & Meindl ,2001)The customers are the core of the chain, as the prime purpose of the existence of anysupply chain is to satisfy customer needs, in the process generating profit for itself(Chopra and Meindl, 2001).As per Sunil Chopra and Meindl (2001), “Supply ChainManagement engages the management of flows between and among stages in supplychain to minimize total cost.OBJECTIVES1. Define the SCM and the study of evolution of SCM.2. To understand the Supply Chain Operational Reference (SCOR) model.RESEARCH METHODOLOGYThe literature review method is used .A literature review of research articles thatspecifically focusing in SCM, its evaluation and SCOR model. Various research papersfrom databases like Pro-quest, Emerald, Science Direct and EBSCO were identified andreferred to. Within these databases, various journals such as International Journal ofLogistics Management, International Journal of Information Management, InternationalJournal of Physical Distribution and Logistics Management, Journal of OperationsManagement, Supply Chain Management: An International Journal, International Journalof Operations and Production Management etc. were referred.Page 2
NCRD’s Business Review : e-Journal, Volume 3, Issue 1 (Jan-Dec 2018)ISSN: 2455-0264First section of this paper, evolution of SCM evolved Secondary data sources,particularly online databases, books, journals, conference papers, etc. Second section ofpaper focusing on the analysis of literature, past theoretical frameworks.Definitions of SCMAmerican Production and Inventory Control Society (APICS, 1990) define the supplychain as the processes from the initial raw materials to final consumption of the finishedproducts linking across supplier-user industries. The supply chain contains the allfunctions inside and exterior of an industry, which facilitate the value chain to makeproducts and provide services to customers (Inman, 1992). Some researchers suggested aclearer SCM definition by adding the information system necessary to monitor all of theactivities (Lee, 2002; Morgan, 1995; Talluri, 2002).The Council of SCM Professionals (CSCMP), which is the premier organization ofsupply chain practitioners, researchers, and academicians, has defined SCM as: “SCMencompasses the planning and management of all activities involved in sourcing andprocurement, conversion, and all Logistics Management activities. Notably, it alsoincludes coordination and collaboration with channel partners, which can be suppliers,intermediaries, third-party service providers, and customers. In essence, SCM integratessupply and demand management within and across companies” (Ballou, 2007).Scott and Westbrook (1991) described SCM as the chain linking each element of themanufacturing and supply process from raw materials to the end user. This managementphilosophy focused on how firms utilized their suppliers’ processes, technology,information, and capability to enhance competitive advantage (Farley, 1997), and theharmonization of the manufacturing, materials, logistics, distribution and transportationfunctions within an organization (Lee and Billington, 1992).Supply Chain Management can be broadly classified into following three types:Page 3
NCRD’s Business Review : e-Journal, Volume 3, Issue 1 (Jan-Dec 2018)ISSN: 2455-0264i. Operational : This is concerned with the routine activities of a facility to ensurethat the more profitable way to fulfill customer order is executed examples areactions taken in course of placing and filling orders.ii. Design: Design mainly focus on decision making regarding facility role,facility location, capacity allocation, market and network.iii. Strategic: Strategic refers to what each process or function will try to doparticularly well. These are decisions at the strategic level by business managerstaken by understanding the dynamics of supply chain and development and theirevolving objectives. Strategic planning is needed in order to challenge existingarrangements and to generate radical alternatives [4].PROCESS VIEWS OF A SUPPLY CHAINA SC is a sequence of processes and flows that take place inside and betweendifferent stages and come together to fill a customer need for a product. Cycle andPush /Pull view are two ways to view the processes performed in a supply chain.1. Cycle View: The processes in a supply chain are separated into asequence of cycles, each performed at the interface between twoconsecutive stages of a supply chain.2. Push/Pull View: The processes in a supply chain are divided into twocategories depending on whether they are executed in response to acustomer order or in anticipation of customer orders. Pull processes aredriven by a customer order, whereas push processes are driven andperformed in anticipation of customer orders.Page 4
NCRD’s Business Review : e-Journal, Volume 3, Issue 1 (Jan-Dec 2018)ISSN: 2455-0264SUPPLY CHAIN OPERATIONS REFERENCE (SCOR) MODEL OFSUPPLY CHAIN COUNCILSCOR modeling is referred today as the most popular methodology to analyze theSupply Chain Management (SCM) performance. The SCOR model is developed bySupply Chain Council in 1996 by Pittiglio Rabin Todd & McGrath and AMR Research.According to Supply Chain Council (SCC) supply chain is managing supply and demand,sourcing raw materials and parts, manufacturing and assembly, warehousing a
SUPPLY CHAIN OPERATIONS REFERENCE (SCOR) MODEL OF SUPPLY CHAIN COUNCIL SCOR modeling is referred today as the most popular methodology to analyze the Supply Chain Management (SCM) performance. The SCOR model is developed by Supply Chain Council in 1996 by Pittiglio Rabin Todd & McGrath and AMR Research.
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Supply chain management 1.1.2.1. Supply chain processes: the integrated supply chain point of view To describe supply chains from a process point of view, we refer to the supply chain operations reference (SCOR) model. SCOR is a cross-industry standard for supply chain management and has been developed and endorsed by the supply-chain council .
companies. In this case, supply chain management mainly focuses on cooperation between the supply chain actors. 1.1.2. Supply chain management 1.1.2.1. Supply chain processes: the integrated supply chain point of view To describe supply chains from a process point of view, we refer to the supply chain operations reference (SCOR) model.
