SCOR 9.0 Bookmarked

SCOR
Supply Chain Operations Reference Model
Version 9.0
Copyright 2008 Supply Chain Council Inc.
Supply-Chain Council, 2008. All rights reserved. The Supply-Chain Council has made every effort to assure the accuracy and usefulness of the information and metrics contained herein and is provided on an AS IS basis. The Supply-Chain Council makes no warranty, express or implied, of merchantability, fitness for a particular purpose, or accuracy. The Supply-Chain Council makes no representation as to the results obtained or obtainable and disclaims all liability for direct, indirect, special or consequential damage, including lost profits, lost business or the like, whether based in contract, tort (including negligence), product liability or otherwise. www.supply-chain.org SCOR is a registered trademark of the Supply-Chain Council in the United States and Canada. All rights reserved. The Supply Chain Council, Inc. SCOR: The Supply Chain Reference ISBN 0-615-20259-4 (binder) Printed in the United States of America. April 2008
Acknowledgments
The following members (alphabetical by company) of the Supply-Chain Council Technical Development Steering Committee and Project Teams devoted extensive time and/or eort to the development of this Model SCOR Version 9.0. Also included are those who devoted much time and experience sharing to develop the section that is now being published separately as a White Paper by the Supply-Chain Council on Financial Impact of SCOR Metrics and Best Practices.
Name
Gerard McCool Kevin F. Manseld Ben Cromwell Greg Grehawick Jrg Nienhaus Arne Ziegenbein Moses Muputisi Kevin Farrington Robert Manseld Kevin McCormack Lars Magnusson Charles-Eric Roussel Sven Verstrepen Srinivasan Sarangapani Reinaldo Fioravanti David Morrow Changrui Ren Jin Dong Gopal Chandrasekaran John Paul Hitesh Patel Anand K. Sundar Mitul Devendra Shah Robert Hagan James Wynn Taylor Wilkerson Iain D. Clarke Ray VanderBok Melinda Davey Marc Bartos Dan Swartwood Monty Boyle George Wellock Caspar Hunsche Sam Fayez Tom Janoshalmi Deanna Yee Joseph Francis Enrico Camerinelli Melinda Spring Scott Sealing John Nyere Sergio Cavalieri Jac Braat Nancy Craft Amy H Buu Ikhlaq Kashkari
Company
Accenture Air Products AIT Group Booz Allen Hamilton Bosch Bosch BP Brightstar CCAT DRK Research Ericsson Essilor France Flanders Institute for Logistics Genpact Hewlett Packard IBM IBM China IBM China IBM GBS iCognitive IDS Scheer Innite Strategies, Inc. Infosys International Paper Knowles Electronics LMI Molson Coors Brewing Company NewVectors NewVectors PMG Benchmarking Pragmatek Pragmatek Pragmatek Process Core Group Productivity Apex SAP Satellite Logistics Group Supply Chain Council Supply-Chain Council Supply-Chain Council United Space Alliance United States Department of Defense University of Bergamo University of Tilburg Volvo Westinghouse Xelocity
Table of Contents
Introduction Metrics o Reliability o Responsiveness o Agility o Cost o Asset Management Processes o Plan o Source o Make o Deliver o Return o Inputs and Outputs Best Practices o SCOR o GreenSCOR o Risk Management Special Applications o GreenSCOR 1 2 2.1 2.2 2.3 2.4 2.5 3 3.1 3.2 3.3 3.4 3.5 3.6 4 4.1 4.2 4.3 5 5.1
Section 1 Introduction
Introduction
Summary
The Supply-Chain Operations Reference model (SCOR) is the product of the Supply-Chain Council (SCC) a global non-prot consortium whose methodology, diagnostic and benchmarking tools help organizations make dramatic and rapid improvements in supply-chain processes. SCC established the SCOR process reference model for evaluating and comparing supply-chain activities and performance. The SCOR-model captures the Councils consensus view of supply chain management. It provides a unique framework that links business process, metrics, best practices and technology into a unied structure to support communication among supply chain partners and to improve the eectiveness of supply chain management and related supply chain improvement activities. SCC membership is open to all companies and organizations interested in applying and advancing the state-of-the-art in supply-chain management systems and practices. The SCC was organized in 1996 and initially included 69 practitioner companies meeting in an informal consortium. Subsequently, the companies of the Council elected to form an independent not for prot trade association. The majority of the SCCs members are practitioners and represent a broad cross-section of industries, including manufacturers, distributors, and retailers. Equally important to the Council and the advancement of the SCOR-model are the technology suppliers and implementers, the academicians, and the government organizations that participate in Council activities and the development and maintenance of the Model. At the time of this release, the Council has approximately 800 corporate members worldwide and has established international chapters in Australia/New Zealand, Latin America, Greater China, Europe, Japan, Southeast Asia, and Southern Africa with additional requests for regional chapters pending. The Supply-Chain Council is interested in providing the widest possible dissemination of the SCOR-model. The wide-spread use of the Model results in better customer-supplier relationships, software systems that can better support members through the use of common measurements and terms, and the ability to rapidly recognize and adopt best practice no matter where it originates. SCC requests that all who use the SCOR-model provide attribution to the Supply-Chain Council. Additionally, members are encouraged to monitor the members section of the SCC website (www.supply-chain.org) to ensure that they are using the latest version of SCOR. This introduction is provided to assist new users of the SCOR-model to begin analytic and implementation projects. It is intended to remind experienced users of the framework and structure of the Model when tackling more complex applications of the Model for their businesses. Finally, it is provided to orient members to the changes between Version 8.0 and Version 9.0. Version 9.0 of the SCOR-model is the eleventh revision since the Models introduction in 1996. Revisions of the Model are made when it is determined by Council members that changes should be made to facilitate the use of the Model in practice. Specic changes in Version 9.0 are outlined later in this Introduction.
1.1.1
Introduction
SCOR Scope
The SCOR-model has been developed to describe the business activities associated with all phases of satisfying a customers demand. The Model itself contains several sections and is organized around the ve primary management processes of Plan, Source, Make, Deliver, and Return (shown in Figure 1). By describing supply chains using these process building blocks, the Model can be used to describe supply chains that are very simple or very complex using a common set of denitions. As a result, disparate industries can be linked to describe the depth and breadth of virtually any supply chain. The Model has been able to successfully describe and provide a basis for supply chain improvement for global projects as well as site-specic projects.
Plan
Plan
Deliver Return Source Return Make Deliver Return
Source Return
Make
Deliver Return
Plan
Source Return Make Deliver Return Source Return
Suppliers Supplier
Supplier
Internal or External
Your Company
Customer
Internal or External
Customers Customer
Figure 1 - SCOR is organized around ve major management processes.
It spans: all customer interactions (order entry through paid invoice), all physical material transactions (suppliers supplier to customers customer, including equipment, supplies, spare parts, bulk product, software, etc.) and all market interactions (from the understanding of aggregate demand to the fulllment of each order). It does not attempt to describe every business process or activity. Specically, the Model does not address: sales and marketing (demand generation), product development, research and development, and some elements of post-delivery customer support. It should be noted that the scope of the Model has changed and is anticipated to change based on Council member requirements. With the introduction of Return, the Model was extended into the area of post-delivery customer support (although it does not include all activities in that area). As shown in Figure 2, the Model is designed and maintained to support supply chains of various complexities and across multiple industries. The Council has focused on three process levels and does not attempt to prescribe how a particular organization should conduct its business or tailor its systems / information ow. Every organization that implements supply chain improvements using the SCOR-model will need to extend the Model, at least to Level 4, using organization-specic processes, systems, and practice.
1.2.1
Introduction
The Model is silent in the areas of human resources, training, and quality assurance. Currently, it is the position of the Council that these horizontal activities are implicit in the Model and there are other highly qualied organizations that are chiey concerned with how an organization should train, retain, organize, and conduct their quality programs. Just as the Council recognized the requirements for marketing and sales in commercial organizations, the Council is not minimizing the importance of these activities, but they are currently out of scope for SCOR. Level # Description
Top Level (Process Types)
Schematic
Comments
Supply-Chain Operations Reference Model
Plan
Source Make Deliver Return Return
Level 1 denes the scope and content for the Supply-Chain Operations Reference Model. Here the basis of competition performance targets are set.
Conguration Level (Process Categories)
A companys supply-chain can be congured-to-order at Level 2 from core process categories. Companies implement their operations strategy through the conguration they choose for their supply-chain. Level 3 denes a companys ability to compete successfully in its chosen markets, and consists of: Process element denitions Process element information inputs, and outputs Process performance metrics Best practices, where applicable System capabilities required to support best practices Systems/tools
Process Element Level (Decompose Processes)
Identify, Prioritize, and Aggregate Supply-Chain Requirements
P1.1
Identify, Assess, and Aggregate Supply-Chain Requirements
P1.2
Balance Production Resources with SupplyChain Requirements
P1.3
Establish and Communicate Supply-Chain Plans
P1.4
Not in Scope
Implementation Level (Decompose Process Elements)
Companies implement specic supply-chain management practices at this level. Level 4 denes practices to achieve competitive advantage and to adapt to changing business conditions.
Figure 2 - SCOR is a hierarchical model with specic boundaries in regard to scope.
1.2.2
Introduction
The SCOR-model is a business process reference model as illustrated in Figure 3. That is, it is a Model that links process elements, metrics, best practice and the features associated with the execution of a supply chain in a unique format. The uniqueness and power of the Model and its successful implementation is chiey derived from using these four elements together. It is important to note that this Model describes processes not functions. In other words, the Model focuses on the activity involved not the person or organizational element that performs the activity.
Business Process Reengineering

Capture the as-is state of a process and derive the desired to-be future state
Benchmarking
Best Practices Analysis
Process Reference Model

Capture the as-is state of a process and derive the desired to-be future state
Quantify the operational performance of similar companies and establish internal targets based on best-inclass results
Quantify the operational performance of similar companies and establish internal targets based on best-inclass results
Characterize the management practices and software solutions that result in best-in-class performance
Figure 3 - SCOR is a business process reference model.
Characterize the management practices and software solutions that result in best-in-class performance
1.2.3
Introduction
SCOR-model Structure
Besides the ve basic management processes (Plan, Source, Make, Deliver, and Return) that provide the organizational structure of the SCOR-model, it is useful to distinguish between the three process types in the Model: planning, execution, and enable (formerly infrastructure). A planning element is a process that aligns expected resources to meet expected demand requirements. Planning processes balance aggregated demand across a consistent planning horizon. Planning processes generally occur at regular intervals and can contribute to supply chain response time. Execution processes are triggered by planned or actual demand that changes the state of products. They include scheduling and sequencing, transforming materials and services, and moving product. Enable processes prepare, maintain, and manage information or relationships upon which planning and execution processes rely. A set of standard notation is used throughout the Model. P depicts Plan elements, S depicts Source elements, M depicts Make elements, D depicts Deliver elements, and R depicts Return elements. SR = Source Return and DR = Deliver Return. An E preceding any of the others (e.g., EP) indicates that the process element is an Enable element associated with the Planning or Execution element (in this case, EP would be an Enable Planning element). As indicated in Figure 2, the Model is hierarchical with three levels. P1.1 is a notation that indicates a third level process element. In this case, it is a Plan (P Level 1) element that is concerned with supply chain planning (1 Level 2) and is specic to identifying, prioritizing, and aggregating supply chain requirements (.1 Level 3). The SCOR-model version 9.0 has reorganized the traditional sections into ve Chapters: Introduction, Metrics, Processes (Plan, Source, Make, Deliver, Return), Best Practices, and Special Applications. For modeling purposes, Return is documented in two locations Source and Deliver. Those Return processes that connect an organization with its supplier (i.e., the return of raw material) are documented as Source Return activities. Those processes that connect an organization with its customer (i.e. the receipt of returned nished goods) are documented as Deliver Return activities. This preserves the concept that Source connects an organization with its suppliers and Deliver connects an organization with its customers. The Plan and Execution (Source, Make, Deliver, and Return) sections are the heart of the Model. The denitions that were listed separately in a Glossary in prior versions are now incorporated into the sections on Metrics, Processes, and Best Practices. The Special Applications section is used for approved SCOR additions that have not yet been tested thoroughly for integration into the Model, but that the SCC believes would be benecial for SCOR users. The Metrics Chapter has a new addition of a coding system particularly benecial for benchmarking as it is based on the Performance Attributes of the metrics. The Attribute of Flexibility has been renamed to be Agility to avoid confusion with its subsets Flexibility and Adaptability. The codes include Reliability RL, Responsiveness RS, Agility AG, Cost CO, and Asset Management AM. The code also consists of the Level of the metric Level 1 Strategic metrics are numbered within each Attribute, i.e., Perfect Order Fulllment is RL.1.1. Level 2s are also numbered within each attribute, so for example, Perfect Condition is RL.2.4. All Level 3 diagnostic metrics are coded by number just based on their alphabetical listing within each attribute since there are so many of them, and added ones are just added onto the end of the list rather than recoding existing metrics. So for example, Direct Material Cost is CO.3.141. The Process Chapter includes the Plan, Source, Make, Deliver, and Return sections that are organized with the standard structure that has been brought back from versions prior to SCOR 8.0. Workow Graphics have returned into the main body of the Model as a result of the combination of software
1.2.4
Introduction
redesign and input by IDS Scheer and the professional design of a book publisher. This combination makes SCOR 9.0 the most usable and readable SCOR model to date. At the beginning of each section, graphics provide a visual representation of the process elements, their relationships to each other, and the inputs and outputs that are germane to each process element. Following the graphics are text tables that identify: 1) the standard name for the process element, 2) the notation for the process element, 3) SCCs standard denition for the process element, 4) performance attributes that are associated with the process element, 5) metrics that are associated with the performance attributes, 6) best practices that are associated with the process (candidates, not necessarily an exhaustive list), and best practice descriptions that can contribute to heightened performance of the process. Within the Source, Make and Deliver process elements, a common internal structure has been agreed upon. The Model focuses on three environments, Make-to-Stock, Make-to-Order, and Engineerto-Order. As a result, S1 becomes Source Make-to-Stock Product, S2 becomes Source Make-to-Order Product and S3 becomes Source Engineer-to-Order Product. This same convention is used for Make, i.e. M1 Make-to-Stock, and Deliver, i.e. D2 Deliver Make-to-Order Product. This convention was extended to Return in Version 5.0. R1 is the Return of Defective Product, R2 is the Return of Maintenance, Repair or Overhaul (MRO) Product, and R3 is the Return of Excess Product and these are each divided into the Source Return SR and Deliver Return DR, so we have SR1 and DR1 both representing R1, and so on. Within each of the planning and execution sections and following the graphic and text descriptions, the associated Enable elements are described using the same graphic and text formats.
Performance Attributes and Level 1 Strategic Metrics

Level 1 Metrics are primary, high level strategic measures that may cross multiple SCOR processes. Level 1 Metrics do not necessarily relate to a SCOR Level 1 process (PLAN, SOURCE, MAKE, DELIVER, RETURN).
Performance Attributes Level 1 Strategic Metrics

Reliability Perfect Order Fulllment Order Fulllment Cycle Time Upside Supply Chain Flexibility Upside Supply Chain Adaptability Downside Supply Chain Adaptability Supply Chain Management Cost Cost of Goods Sold Cash-To-Cash Cycle Time Return on Supply Chain Fixed Assets Return on Working Capital
Figure 4 - SCOR Performance Attributes and Level 1 Metrics
Customer-Facing Responsiveness Agility
Internal-Facing Costs Assets
! ! ! ! ! ! ! ! ! !
1.2.5
Introduction
The metrics are used in conjunction with performance attributes. In Version 4.0 of the Model, the Performance Attributes were expanded from four (Supply Chain Reliability, Supply Chain Flexibility and Responsiveness, Supply Chain Costs, and Supply Chain Asset Management) to ve (Supply Chain Reliability, Supply Chain Responsiveness, Supply Chain Flexibility, Supply Chain Costs, and Supply Chain Asset Management). In SCOR 9.0, Supply Chain Flexibility has been updated to Supply Chain Agility to avoid confusion with its subsets Flexibility and Adaptability. The table in Figure 5 denes the performance attributes and indicates which Level 1 metrics are associated with each attribute. The Performance Attributes are characteristics of the supply chain that permit it to be analyzed and evaluated against other supply chains with competing strategies. Just as you would describe a physical object like a piece of lumber using standard characteristics (e.g., height, width, depth), a supply chain requires standard characteristics to be described. Without these characteristics it is extremely dicult to compare an organization that chooses to be the low-cost provider against an organization that chooses to compete on reliability and performance.
Performance Attributes and Associated Level 1 Metrics

Performance Attribute Supply Chain Reliability
Performance Attribute Denition The performance of the supply chain in delivering: the correct product, to the correct place, at the correct time, in the correct condition and packaging, in the correct quantity, with the correct documentation, to the correct customer. The speed at which a supply chain provides products to the customer. The agility of a supply chain in responding to marketplace changes to gain or maintain competitive advantage. Level 1 Strategic Metric Perfect Order Fulllment (RL.1.1)
Supply Chain Responsiveness Supply Chain Agility
Order Fulllment Cycle Time (RS.1.1) Upside Supply Chain Flexibility (AG.1.1) Upside Supply Chain Adaptability (AG.1.2) Downside Supply Chain Adaptability (AG.1.3)
Supply Chain Costs Supply Chain Asset Management
The costs associated with operating the supply chain.
Supply Chain Management Cost (CO.1.1) Cost of Goods Sold (CO.1.2)
The eectiveness of an organization in managing assets to support demand satisfaction. This includes the management of all assets: xed and working capital.
Cash-to-Cash Cycle Time (AM.1.1) Return on Supply Chain Fixed Assets (AM.1.2) Return on Working Capital (AM.1.3)
Figure 5 Denitions for SCOR Performance Attributes and listing of associated Level 1 metrics.
1.2.6
Introduction
Associated with the Performance Attributes are the Level 1 Strategic Metrics. These Level 1 Metrics are the calculations by which an implementing organization can measure how successful it is in achieving its desired positioning within the competitive market space. While these Performance Attributes are critical in implementing the Model, formal denitions were not included in the Model until Version 4.0, and were not able to be included in Version 8.0 due to software used to develop the SCOR data. In Version 9.0, these have been reincorporated into not only the Model, but also the new metrics coding identication system. Many metrics in the Model are hierarchical just as the process elements are hierarchical. Level 1 Metrics are created from lower level calculations. (Level 1 Metrics are strategic, high level measures that may cross multiple SCOR processes. Level 1 Metrics do not necessarily relate to a SCOR Level 1 process (PLAN, SOURCE, MAKE, DELIVER, and RETURN). Metrics hierarchy trees are included for metrics that t this structure. Lower level calculations (Level 2 metrics) are generally associated with a narrower subset of processes. For example, Delivery Performance is calculated as the total number of products delivered on time and in full based on a commit date. Additionally, even lower level metrics (diagnostics) are used to diagnose variations in performance against plan. For example, an organization may wish to examine the correlation between the request date and commit date. Diagnostic metrics are not necessarily hierarchical.
1.2.7
Introduction
SCOR Version 9.0 Changes
Processes
SCOR 9.0 adds a whole layer of new ENABLE processes for Risk Management. These processes can be found in the Ex.9 processes. These are completely new processes with new metrics, best practices, and inputs and outputs as well. The SCOR 8.0 EP.9 (Align Supply Chain Unit Plan with Financial Plan) and ES.9 (Manage Supplier Agreements) processes have been renumbered to EP.10 and ES.10 respectively. New process elements have been added in SCOR 9.0 to manage WASTE DISPOSAL processes as part of the GreenSCOR integration. Make-to-Stock, Make-to-Order and Engineer-to-Order now each have a Waste Disposal process element: M1.7, M2.7 and M3.8. Level 2 process descriptions have been updated to improve the dierentiation of Make-to-Stock, Make-to-Order and Engineer-to-Order process categories. Process EP.9 EP.9 ES.9 ES.9 M1.7 M2.7 M3.7 EM.9 ED.9 ER.9 Change summary Renumbered existing EP.9 to EP.10 (to facilitate Risk Management) New process added (Risk Management) Renumbered existing ES.9 to ES.10 (to facilitate Risk Management) New process added (Risk Management) New process added (GreenSCOR) New process added (GreenSCOR) New process added (GreenSCOR) New process added (Risk Management) New process added (Risk Management) New process added (Risk Management)
Figure 6, Summary of process number changes
Metrics
The Performance Attribute of Flexibility has been renamed to be Agility to eliminate confusion with the metrics containing the word Flexibility. The denition of the performance attribute has not changed. SCOR 9.0 introduces new metrics to support risk management and environmental (GreenSCOR) programs.
1.3.1
Introduction
In SCOR 9.0 metrics coding is introduced. This will simplify identication, eliminate confusion for similar-sounding metrics and is particularly benecial for benchmarking as it is based on the Performance Attributes of the metrics. The format of the metric ID or number is:
XX.y.z XX = Performance Attribute. The possible values for XX are: RL = Reliability, RS = Responsiveness, AG = Agility, CO = Cost, and AM = Asset Management. y = Level of the metric z = a unique number
Figure 7, Metrics Coding System
Examples: The metric ID for Perfect Order Fulllment is RL.1.1. From this you can derive that Perfect Order Fulllment is a strategic (Level 1) Reliability metric. An example of a level 2 (diagnostic metric) is RL.2.4: Perfect Condition. Level 3 diagnostic metrics are coded the same way; the unique number has been assigned based on the alphabetical listing. Future metric additions will simply receive an incremental number. An example of a level 3 diagnostic metric is CO.3.141 (Direct Material Cost). SCOR 9.0 consolidates all metrics in a dedicated section of the reference. Section 2 (Metrics) organizes all metrics by performance attribute. Within each chapter the metrics are sorted on metric ID, thus putting the metrics in the following sequence: First level 1 metrics, then level 2 metrics and nally level 3 metrics.
Best Practices
The Best Practices Glossary and Appendix have been consolidated in the Best Practices Section (Section 4) to contain the denitions and processes where every best practice can be implemented. Best practices have been added for GreenSCOR (Chapter 4.2) and Risk Management GreenSCOR (Chapter 4.3).
Reference reorganization
Additional to consolidating both the metrics and the best practices other changes have been made to the order of information in the reference. Inputs and Outputs are now the last chapter of the process section. The Workow Graphics have returned to the process chapters and accompany the processes they describe once again. The graphics have been reformatted to improve readability.
1.3.2
Introduction
SCOR 8.0 Introduction Plan Source Make Deliver Return Workow Graphics Glossary Process Terms Metrics Best Practices Inputs and Outputs Appendices A: Metrics B: Best Practices No longer applicable Consolidated with glossary Consolidated with glossary New
Figure 7, Summary of Content Changes in SCOR 9.0
Comment Unchanged
SCOR 9.0 Section/ Chapter Section 1 Section 3, Chapter 1 Section 3, Chapter 2 Section 3, Chapter 3 Section 3, Chapter 4 Section 3, Chapter 5
Section/Chapter Description Introduction Plan Source Make Deliver Return
Accompanies the process No longer applicable
Section 3
Section 3 Section 2 Section Section 3, Chapter 6
Processes Metrics Best Practices Inputs and Outputs
Section 2 Section 4 Section 5
Metrics Best practices Special Applications
The new Special Applications section allows special interest groups and project groups to present applications of SCOR that may be under development, not yet generally be accepted, or may require additional case studies or proof points. The metrics proposed in Chapter 5.1 are an example of metrics requiring further discussion among practitioners.
1.3.3
Introduction
The Technical Change Process
The SCOR-model is developed and maintained by the voluntary eorts of the Supply Chain Council (SCC)members. Unlike other organizations with large technical stas, the Council depends on the contributions of its members to actively advance the state of knowledge in supply chain by identifying required Model changes, researching and validating those changes, and developing the consensus regarding the proposed changes. SCOR-model versions prior to Version 6.0 were developed in a Committee structure that was focused on developing a stable, usable Model that could be used by experienced Council members as well as organizations newly introduced to the SCOR concept. In 2002, condent that the Models stability had been demonstrated with over 5 years of application experience by Council members, the Supply Chain Council shifted its technical development focus to specic implementation issues. The current technical development process relies on project teams composed of volunteers from Supply Chain Council member organizations. These project teams are short-lived groups that focus on specic Model challenges. It is expected that the normal term of a project team will be between 3-6 months. The change process and the coordination of the project team activities is led by the Technical Development Steering Committee (TDSC), a standing body elected by their peers in the Council. Changes to the Model are normally initiated by a Council member or members (but may be initiated by a Special Industry Group, an implementation project team, or the Chief Technical Ocer). The primary mechanism for changing the Model is the Project Team. These teams propose areas of investigation, pursue and develop proposals for Model development and publish research results on the Council website. These activities are coordinated by the Supply Chain Councils Technical Development Steering Committee, which is comprised of elected representatives from the Councils membership. The Model change process is documented on the SCCs website. Essentially, the process consists of: 1) The Council issues a call for volunteers to work on an identied need for revision or change, 2) volunteers submit a Charter Proposal to the TDSC outlining the concept, scope of work, schedules and milestones, and identifying the volunteer resources, 3) the TDSC reviews the proposed Charter and provides feedback on the proposed changes to the initiating group, 4) upon approval, the Project Team crafts the details of their scope of work and determines whether it is likely their eorts will lead to a Model change (which generally includes the modication of SCOR processes, metrics, best practices, and inputs and outputs) or a research report (white paper), 5) the Project Team proposes how to integrate proposed changes into the overall Model, 6) after nal technical review the TDSC forwards the technical community recommendations for proposed changes/additions to the SCC Board of Directors, and 7) following the approval of the Board, the new Model is published for the SCC membership.
1.4.1
1.4.2
Section 2 Metrics
RL.1.1
Perfect Order Fulllment
The percentage of orders meeting delivery performance with complete and accurate documentation and no delivery damage. Components include all items and quantities ontime using the customers denition of on-time, and documentation packing slips, bills of lading, invoices, etc.
Qualitative Relationship Description An order is considered perfect if the products ordered are the products provided and the quantities ordered match the quantities provided (% In Full). A delivery is considered perfect if the location, specied customer entity and delivery time ordered is met upon receipt (Delivery Performance to Customer Commit Date). Documentation supporting the order line is considered perfect if it is all accurate, complete, and on time (Accurate Documentation). The product condition is considered perfect if the product is delivered / faultlessly installed (as applicable) on specication, with the correct conguration, with no damage, customer ready, and is accepted by the customer (Perfect Condition) Quantitative Relationship (optional, if calculable) None Identied Calculation [Total Perfect Orders] / [Total Number of Orders] x 100% Note, an Order is Perfect if the individual line items making up that order are all perfect. The Perfect Order Fulllment calculation is based on the performance of each Level 2 component of the order line to be calculated (product & quantity, date & time & Customer, documentation and condition). For an order line to be perfect, all of the individual components must be perfect. The calculation of line item perfect order line fulllment is based on the Level 2 components: Each component receives a score of 1 if it is judged to be perfect. It receives a score of 0 if not perfect. If the sum of the scores equal the number of components (in this case, 4) the order line is perfectly fullled. Data Collection Data for the components that are used to drive the calculation of supply chain performance are primarily taken from Deliver and impact Deliver Enable process elements. These are primarily associated with the original commitment (Customer Order Processing D1.2, D 2.2, D3.3) and the satisfaction of that commitment (Receipt and Installation (as appropriate) D1.11, D1.13, D1.14, D1.15, D2.11, D2.13, D2.14, D2.15, D3.11, D3.13, D3.14, D3.15). In addition, the documents necessary for support of the supply chain process should be scored across the set of Deliver process elements. The Enable Deliver Process Element - Assess Delivery Performance (ED.2) should be updated from metrics derived.
2.1.1
RL.1.1
Discussion The performance of the supply chain is considered perfect if the original commitment made to a customer is met through the supply chain. An order is dened as a collection of one or more order lines representing a request to deliver specied quantities of goods or to render specic services. The order can further be dened as a request (with a specic identier as a reference) to deliver specied items or to render specic services with specic prices, dates, and quantities. Commitments are made to a customer at the order line level, where an order line is dened as a line representing a commitment on a sales order. An order line always references a product or service. For an order to be considered perfect the following standards must be met: Delivered complete; all items on the order line are delivered in the quantities specied Delivered on time to the initial commitment date, using the customers denition of on-time delivery Documentation supporting the order including packing slips, bills of lading, invoices, quality certications, etc., is complete and accurate Faultlessly installed (as applicable), correct conguration, customer-ready and accepted, no damage, on specication Orders canceled by the customer are excluded from the metric. Order changes initiated by the customer and agreed to by the supplier supersede initial commitments and form a new comparative basis for the metric. Often for date and quantity issues (and occasionally product), a range rather than a strict value is used. This is acknowledged as a standard practice; in those situations the standard measured is considered to be met perfectly if the range specied is satised. The term customer-ready for the perfect condition standard may imply a subjective component based on the customers satisfaction. Although condition may not be as rigorously measured as time or quantity it should be considered as a component if available, especially since this attribute measures performance of the supply chain which is, of course, ultimately measured by its customers. It should also be noted that a corresponding evaluation of suppliers performances could be determined by extending these standards to each suppliers ability to source products. Hierarchical Metric Structure
Level 1
RL.1.1 Perfect Order Ful llment RL.2.1 % of Orders Delivered in Full
Level 2
RL.2.2 Delivery Performance to Customer Commit Date RL.2.3 Documentation Accuracy RL.2.4 Perfect Condition
2.1.2
RL.2.1
% of Orders Delivered In Full
Percentage of orders which all of the items are received by customer in the quantities committed
Qualitative Relationship Description An order is considered delivered in full if: All items ordered are the items actually provided, and no extra items are provided All quantities received by the customer match the order quantities (within mutually agreed tolerances) Quantitative Relationship (optional, if calculable) None Identied Calculation [Total number of orders delivered in full] / [Total number of orders delivered] x 100% Data Collection Data for the components that are used to drive the calculation of % In Full are primarily associated with the original order processing step of Reserve inventory and Determine Delivery Date (D1.3, D2.3 & D3.3), inventory availability (M1.1, M2.1, M3.1) including inventory location accuracy, (ED.4), and the satisfaction of that commitment through the shipment and customer receiving processes (D 1.12, D1.13, D2.12, D.2.13, D3.12, D3.13) Discussion Order quantities are based on item / quantity original commitments agreed to by the customer. Orders canceled by the customer are excluded from the metric. Order changes initiated by the customer and agreed to by the supplier supersede original commitments and form a new comparative basis for the metric. This metric has no timing element, such that orders deliberately split by the supplier should still be considered in full so long as all metric criteria are met. In some cases, such as for supplying bulk materials, committed quantities refer to a range that is acceptable to the customer rather than a strict value. Several SCOR diagnostic metrics exist that can be used to focus % In Full improvement eorts. Some of these include: % Orders Scheduled to Requested Quantity Schedule Achievement Yield variability Planned Shipment Fill Rate (not yet dened) % Stock Outs (not yet dened) Inventory Cycle Count Accuracy (not yet dened) Orders may not be lled completely to the customers original request quantity due to the inability to schedule to the initial request. Breakdown may also occur from the inventory availability (including stock outs for MTS and schedule achievement for MTO and ETO) and inventory location accuracy. Lastly, a deviation from the shipment plan may lead to inability to fulll an order completely.
2.1.3
RL.2.1
Hierarchical Metric Structure
Level 1 Level 2
RL.1.1 Perfect Order Ful llment RL.2.1 % of Orders Delivered in Full Delivery Item Accuracy Delivery Quantity Accuracy
Level 3
2.1.4
RL.2.2
Delivery Performance to Customer Commit Date
The percentage of orders that are fullled on the customers originally scheduled or committed date
Qualitative Relationship Description An order is considered delivered to the original Customer commitment date if: The order is received on time as dened by the customer The delivery is made to the correct location and Customer entity Quantitative Relationship (optional, if calculable) None Identied Calculation [Total number of orders delivered on the original commitment date] / [Total number of orders delivered] x 100% Data Collection Data for the components that are used to drive the calculation of Delivery Performance to Customer Commit Date are primarily associated with the original order processing step of Reserve inventory and Determine Delivery date (D1.3, D2.3 & D3.3), and the satisfaction of that commitment through the shipment and customer receiving processes (D 1.12, D1.13, D2.12, D2.13, D3.12, D3.13). Discussion Order delivery performance from a timing perspective is based on original commitments agreed to by the customer. The acceptable window for delivering on time should be dened in the customer service level agreement. Orders canceled by the customer are excluded from the metric. Order changes impacting the timing of a delivery that are initiated by the customer and agreed to by the supplier supersede original commitments and form a new comparative basis for the metric. The original commitment date can refer to a range, rather than a strict date and time, that is acceptable to the customer (e.g. advanced shipments). This metric has no In Full element, such that partial deliveries can still be considered as meeting the Customer Commit Date so long as all metric criteria are met. Measuring the frequency of accepting the customers original request date, vs. commit date, can be an important measure of customer satisfaction. Several SCOR diagnostic metrics exist that can be used to focus delivery performance improvement eorts. Some of these include: % Orders Scheduled to Request % Orders Shipped on time (not yet dened) Carrier Performance Reliability (not yet dened) Orders may not be delivered to the Customer Commit Date due to breakdowns in the order fulllment and shipment process (e.g. Transportation availability). Orders may also be delivered late due to carrier delivery performance / issues.
2.1.5
RL.2.2
Level 1 Level 2
RL.1.1 Perfect Order Ful llment RL.2.2 Delivery Performance to Customer Commit date Customer Commit Date Achievement Time customer Receiving Delivery Location Accuracy
Level 3
2.1.6
RL.2.3
Documentation Accuracy
Percentage of orders with accurate documentation supporting the order, including packing slips, bills of lading, invoices, etc.
Qualitative Relationship Description An order is considered to have accurate documentation when the following are accepted by the customer: Shipping documentation Payment documentation Compliance documentation Other required documentation All documentation must be complete, correct, and readily available when and how expected by the customer, Government and other supply chain regulatory entities. Quantitative Relationship (optional, if calculable) None Identied Calculation [Total number of orders delivered with accurate documentation] / [Total number of orders delivered] x 100% Document supporting the order includes: Shipping documentation: o Packing slips (Customers) o Bill of lading (Carriers) o Government or Customs documentation / forms Payment Documentation: o Invoice o Contractual outline agreement Compliance documentation o Material Safety Data Sheets Other required documentation o Quality certication Data Collection Data for the components that are used to drive the calculation of Accurate Documentation are primarily associated with the Deliver processing step of Load Product & Generate Shipping Documentation (D1.11, D2.11, D3.11), and Invoice (D1.15, D2.15, D3.15). The data collection step is part of Assess Delivery Performance (ED2) and Manage Deliver Information (ED3)
2.1.7
RL.2.3
Discussion This metric is calculated at the order level. The timeliness and quality of the documentation is measured from the perspective of the customer, Government, and other regulatory entities. Documentation may be late or incomplete due to the inability to prepare / process the correct documentation on time. Inaccurate or late shipping documentation may prevent the product to be loaded or shipped, increase the customs delay, and delay the customers acceptance of the order. Inaccurate or late invoices may also lead to the inability to fulll the customer request. The denition encompasses On time and Accurate documentation. However, on-time documentation implies a scheduled ship date and scheduled invoice date. Accurate documentation metrics are similar to what exists for SOURCE process metrics Possible diagnostic metrics that can be used to focus Accurate Documentation improvement eorts include: % orders documentation (shipping and invoice) processed on time % faultless invoices Hierarchical Metric Structure
Level 1 Level 2
RL.1.1 Perfect Order Ful llment RL.2.3 Documentation Accuracy Shipping Documentation Accuracy Compliance Documentation Accuracy Other Required Documentation Accuracy Payment Documentation Accuracy
Level 3
2.1.8
RL.2.4
Perfect Condition
Percentage of orders delivered in an undamaged state that meet specication, have the correct conguration, are faultlessly installed (as applicable), and accepted by the customer
Qualitative Relationship Description An order is considered to be delivered in perfect condition if all items meet the following criteria: Undamaged Meet specication and has correct conguration (as applicable) Faultlessly installed (as applicable) and accepted by the customer Not returned for repair or replacement (within the warranty period) Quantitative Relationship (optional, if calculable) None Identied Calculation [ Number of orders delivered in Perfect Condition ] / [Number of orders delivered ] x 100% Data Collection Data for the components that are used to drive the calculation of Perfect Condition are primarily associated with the receipt, installation (as applicable) and satisfaction of the order commitment (D1.13, D1.14, D2.13, D2.14, D3.13, D3.14). The Enable Deliver Process Element - Assess Delivery Performance (ED.2) should be updated to reect this metric and its components. This data is typically available from a complaints, claims, or warranty/returns database. Discussion This metric, calculated at the order level, assesses the quality of products delivered through the supply chain from the customers perspective. Justied and non-justied product quality issues, claims and returns within the warranty period are included and count against this metric. Improving this metric lowers the supply chain cost associated with claims and returns. Several SCOR diagnostic metrics exist that can be used to focus Perfect Condition improvement eorts. Some of these include: Cost of Noncompliance Damage and Shrinkage Scrap Expense Warranty Costs Yield Variability
2.1.9
RL.2.4
Level 1 Level 2
RL.1.1 Perfect Order Ful llment RL.2.4 Perfect Condition Orders Delivered Damage Free Conformane Orders Delivered Defect Free Conformane
Level 3
% Orders Received Damage Free % Faultless Installations Warranty & Returns
2.1.10
RL
Level 3 Reliability Metrics
Metric ID
RL.3.1
Metric Name
# of complaints regarding missing environmental documentation # of recordkeeping related NOVs # of sta-related environmental violations % correct material documentation
Metric Denition
The number of products released without proper environmental documentation as a percent of total products released The number of recordkeeping related regulatory violations received per year The number of environmental violations per year that are a result of personnel error or improper training The percent of total shipments that include the correct environmental documentation % Error-free Returns Shipped % Identied MRO Products Returned To Service % Item Location Accuracy The percent of capital equipment that is in compliance with manufacturer recommended maintenance requirements or maintenance best practice requirements. The number of employees trained on environmental requirements as a percent of total Make employees Correct destination, according to the schedule, with the correct part and documentation
Process
M1.6: Release Product to Deliver
RL.3.2
M1.6: Release Product to Deliver
RL.3.3
EM.2: Manage Production Performance D1.10: Pack Product D2.9: Pick Product D3.8: Receive Product from Source or Make SR2.5: Return MRO Product SR1.5: Return Defective Product SR3.5: Return Excess Product SR2.2: Disposition MRO Product
RL.3.4
RL.3.5
% Error-free Returns Shipped % Identied MRO Products Returned To Service % Item Location Accuracy % of assets in compliance with scheduled maintenance requirements % of employees trained on environmental requirements % of Excess Product Returns Delivered Complete to the Designated Return Center
RL.3.6
RL.3.7 RL.3.8
D4.5: Fill Shopping Cart ES.5: Manage Capital Assets
RL.3.9
EM.8: Manage Make Regulatory Environment
RL.3.10
DR3: Deliver Return Excess Product SR3: Source Return Excess Product
2.1.11
RL
Metric ID
RL.3.11
Metric Name
% of Faultless Invoices
Metric Denition
The number of invoices processed without issues and or errors divided by the total number of invoices. Examples of potential invoice defects are: Change from customer purchase order without proper customer involvement Wrong Customer Information (e.g., name, address, telephone number) Wrong Product Information (e.g., part number, product description) Wrong Price (e.g., discounts not applied) Wrong Quantity or Wrong Terms or Wrong Date Number of Faultless Installations divided by Total Number of Units Installed. % of MRO returns delivered to the correct service provider location, within schedule, with the correct part and documentation The number of products that meet desired environmental performance specications as a per cent of total products produced The number of products with proper environmental labels in place as a per cent of total products produced
Process
D1.15: Invoice D2.15: Invoice D3.15: Invoice
RL.3.12
% Of Faultless Installations % of MRO returns delivered to the correct service provider location % of products meeting specied environmental performance requirements % of products with proper environmental labeling (if required) % of suppliers meeting environmental metrics/criteria
D1.14: Install Product D2.14: Install Product DR2: Deliver Return MRO Product
RL.3.13
RL.3.14
M2.6: Release Finished Product to Deliver
RL.3.15
M2.6: Release Finished Product to Deliver
RL.3.16
Number of suppliers that completely meet agreement environmental criteria divided by the total number of suppliers used.
ES.7: Manage Supplier Network ES.2: Assess Supplier Performance D2.7: Select Carriers and Rate Shipments ES.10: Manage Supplier Agreements D1.7: Select Carriers and Rate Shipments S3.2: Select Final Supplier (S) and Negotiate S3.1: Identify Sources of Supply S2.2: Receive Product S1.2: Receive Product S3.4: Receive Product
RL.3.17
% of suppliers with an EMS or ISO 14001 certication % Orders/ Lines Processed Complete
Percent of suppliers used that have a validated Environmental Management System or ISO 14000 certication The number of orders / lines that are processed complete divided by the total orders / lines processed within the measurement period
RL.3.18
2.1.12
RL
Metric ID
RL.3.19
Metric Name
% Orders/ Lines Received Defect Free % Orders/ Lines Received OnTime To Demand Requirement
Metric Denition
The number of orders / lines that are received defect free divided by the total orders / lines processed in the measurement period. The number of orders / lines that are received on-time to the demand requirements divided by the total orders / lines for the demand requirements in the measurement period Percent of orders or lines received that have the correct material content as specied in the product design specs and supplier agreements. Percent of orders or lines received that are packaged correctly with the right type and quantity of packaging material. The number of orders / lines that are received on-time with correct shipping documents divided by the total orders / lines processed in the measurement period The number of orders / lines that are processed damage free divided by the total orders / lines processed in the measurement period The number of product orders / lines that are transferred on-time to demand requirements divided by the total orders / lines transferred in the measurement period The number of transactions processed without error divided by the total transactions processed in the measurement period. The number of schedules that are changed within the suppliers leadtime divided by the total number of schedules generated within the measurement period
Process
S1.3: Verify Product S2.3: Verify Product S3.5: Verify Product S1.2: Receive Product S2.2: Receive Product S3.4: Receive Product
RL.3.20
RL.3.21
% Orders/ lines received with correct content % Orders/ lines received with correct packaging % Orders/ Lines Received with Correct Shipping Documents % Orders/ lines received damage free % Product Transferred OnTime to Demand Requirement % Product Transferred without Transaction Errors % Schedules Changed within Suppliers Lead Time
S1.3: Verify Product S2.3: Verify Product S3.5: Verify Product S1.2: Receive Product S2.2: Receive Product S3.4: Receive Product S1.2: Receive Product S2.2: Receive Product S3.4: Receive Product
RL.3.22
RL.3.23
RL.3.24
S1.3: Verify Product S2.3: Verify Product S3.5: Verify Product S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product
RL.3.25
RL.3.26
S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product S1.1: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries
RL.3.27
2.1.13
RL
Metric ID
RL.3.28
Metric Name
% Shipping Schedules that Support Customer Required Return by Date Age of Product / Customer Risk Data (months)
Metric Denition
% Shipping Schedules that Support Customer Required Return by Date
Process
SR1.4: Schedule Defective Product Shipment SR2.4: Schedule MRO Shipment SR3.4: Schedule Excess Product Shipment ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk D1.11: Load Vehicle & Generate Shipping Documentation D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents M1.4: Package M2.4: Package M3.5: Package D1.13: Receive & Verify Product by Customer D2.13: Receive & Verify Product by Customer D3.13: Receive & Verify Product by Customer
RL.3.29
The age in months of the product of customer risk data i.e. audit age, assessments, performance, etc.
RL.3.30
Age of Supplier Risk Data (months)
The age in months of the supplier risk data i.e. audit age, assessments, performance, etc.
RL.3.31
Compliance Documentation Accuracy
Percentage of compliance documentations are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities. Compliance documentations includes material safety data sheets
RL.3.32
Customer Commit Date Achievement Time Customer Receiving
Percentage of orders which is received on time as dened by the customer
2.1.14
RL
Metric ID
RL.3.33
Metric Name
Delivery Item Accuracy
Metric Denition
Percentage of orders in which all items ordered are the items actually provided, and no extra items are provided
Process
D1.2: Receive, Enter & Validate Order D1.4: Consolidate Orders D1.11: Load Vehicle & Generate Shipping Documentation D1.12: Ship Product D1.13: Receive & Verify Product by Customer D2.2: Receive, Congure, Enter & Validate Order D2.4: Consolidate Orders D2.11: Load Product & Generate Shipping Documentation D2.12: Ship Product D2.13: Receive & Verify Product by Customer D3.3: Enter Order, Commit Resources & Launch Program D3.6: Route Shipments D3.11: Load Product & Generate Shipping Documents D3.12: Ship Product D3.13: Receive & Verify Product by Customer D1.2: Receive, Enter & Validate Order D1.4: Consolidate Orders D1.11: Load Vehicle & Generate Shipping Documentation D1.12: Ship Product D1.13: Receive & Verify Product by Customer D2.2: Receive, Congure, Enter & Validate Order D2.4: Consolidate Orders D2.11: Load Product & Generate Shipping Documentation D2.12: Ship Product D2.13: Receive & Verify Product by Customer D3.3: Enter Order, Commit Resources & Launch Program D3.6: Route Shipments D3.11: Load Product & Generate Shipping Documents D3.12: Ship Product D3.13: Receive & Verify Product by Customer
RL.3.34
Delivery Location Accuracy
Percentage of orders which is delivered to the correct location and customer entity
2.1.15
RL
Metric ID
RL.3.35
Metric Name
Delivery Quantity Accuracy
Metric Denition
Percentage of orders in which all quantities received by the customer match the order quantities (within mutually agreed tolerances)
Process
D1.2: Receive, Enter & Validate Order D1.4: Consolidate Orders D1.11: Load Vehicle & Generate Shipping Documentation D1.12: Ship Product D1.13: Receive & Verify Product by Customer D2.2: Receive, Congure, Enter & Validate Order D2.4: Consolidate Orders D2.11: Load Product & Generate Shipping Documentation D2.12: Ship Product D2.13: Receive & Verify Product by Customer D3.3: Enter Order, Commit Resources & Launch Program D3.6: Route Shipments D3.11: Load Product & Generate Shipping Documents D3.12: Ship Product D3.13: Receive & Verify Product by Customer P1.3: Balance Supply Chain Resources with SC Requirements P4.4: Establish Delivery Plans M1.3: Produce and Test D1.3: Reserve Inventory and Determine Delivery Date D1.9: Pick Product P1.1: Identify, Prioritize and Aggregate SC Requirements P2.1: Identify, Prioritize and Aggregate Product Requirements P3.1: Identify, Prioritize and Aggregate Production Requirements P4.1: Identify, Prioritize and Aggregate Delivery Requirements P4.2: Identify, Assess and Aggregate Delivery Resources EP.4: Manage Integrated Supply Chain Inventory EP.5: Manage Integrated Supply Chain Capital Assets EP.6: Manage Integrated Supply Chain Transportation EP.7: Manage Planning Conguration
RL.3.36
Fill Rate
The percentage of ship-from-stock orders shipped within 24 hours of order receipt. For services, this metric is the proportion for services that are lled so that the service is completed within 24 hours Forecast accuracy is calculated for products and/or families for arkets/distribution channels, in unit measurement. Common calculation (Sum Actuals - Sum of Variance) / Sum Actuals to determine percentage error. *monitoring the delta of Forecast Accuracy over measured time periods can determine success rates.
RL.3.37
Forecast Accuracy
2.1.16
RL
Metric ID
RL.3.38
Metric Name
Number of notices of violation received Number of occurrences where excessive inventory is returned and followed Orders Delivered Damage Free Conformance
Metric Denition
Number of violations issued by regulatory authorities per 12 month period Number of occurences where excessive inventory is returned and followed
Process
EP.8: Manage Plan Regulatory Requirements and Compliance SR3.1: Identify Excess Product Condition
RL.3.40
RL.3.41
Percentage of orders which is delivered without damage
D1.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D3.13: Receive and Verify Product by Customer D1.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D3.13: Receive and Verify Product by Customer D1.11: Load Vehicle & Generate Shipping Documentation D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents
RL.3.42
Orders Delivered Defect Free Conformance
Percentage of orders which is delivered without defect
RL.3.43
Other Required Documentation Accuracy
Percentage of other required documentations (besides of compliance documentation, payment documentation and shipping documentation) are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities. This kind of documentations includes quality certication The average time associated with Package Percentage of payment documentations are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities. Payment documentations includes invoice, contractual outline agreement Number of reportable air, water, or solid waste accidental releases per year Return Shipments Shipped on Time
RL.3.44 RL.3.45
Package Cycle Time Payment Documentation Accuracy
M1.4: Package D1.11: Load Vehicle & Generate Shipping Documentation D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents
RL.3.46 RL.3.47
Reportable Release Incidents Return Shipments Shipped on Time
ED.5: Manage Deliver Capital Assets SR1.5: Return Defective Product SR2.5: Return MRO Product SR3.5: Return Excess Product
2.1.17
RL
Metric ID
RL.3.48
Metric Name
Risk Mitigation Plan
Metric Denition
% of sources with documented contingency plans and % of sourced items with alternate or redundant sources
Process
EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk M1.1: Schedule Production Activities M2.1: Schedule Production Activities M3.2: Schedule Production Activities D1.11: Load Vehicle & Generate Shipping Documentation D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents
RL.3.49
Schedule Achievement
The percentage of time that a plant achieves its production schedule. This calculation is based on the number of scheduled end-items or total volume for a specic period. Note: overshipments do not make up for undershipments. Percentage of shipping documentations are complete, correct, and readily available when and how expected by customer, Government and other supply chain regulatory entities. Shipping documentations includes packing slips (customers), bill of lading (carriers) and government or customs documentation / forms The percent of mitigation plans implemented for supplier risk.
RL.3.50
Shipping Documentation Accuracy
RL.3.51
Supplier Mitigation Plans Implemented (percent)
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration R2: Return MRO Product
RL.3.52
Supplier return order cycle time reestablished and sustained in 30 days Total # of Conrmed MRO Conditions/ Total # of MRO Service Requests Initiated
Supplier return order cycle time reestablished and sustained for increased quantities produced given 30 days, including supplier return order processing cycle time, pick-to-ship cycle, transit time, etc. Total # of Conrmed MRO Conditions/ Total # of MRO Service Requests Initiated
RL.3.53
2.1.18
RL
Metric ID
RL.3.54
Metric Name
VAR of product/ customer performance -
Metric Denition
Value at Risk the sum of the probability of risk events times the monetary impact of the events for the specic product or customer.
Process
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk M1.3: Produce and Test M1.4: Package
RL.3.55
Warranty and Returns
Number of returns within the warranty period. Warranty is a commitment, either expressed or implied that a certain fact regarding the subject matter of a contract is presently true or will be true. Warranty costs include materials, labor and problem diagnosis for product defects.
RL.3.56
Warranty Costs
M1.3: Produce and Test M1.4: Package M2.3: Produce and Test M2.4: Package M3.4: Produce and Test M3.5: Package M1.7: Waste Disposal M2.7: Waste Disposal M3.8: Waste Disposal M1.3: Produce and Test M1.4: Package M2.3: Produce and Test M2.4: Package M3.4: Produce and Test M3.5: Package M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test
RL.3.57
Waste Processing Errors Yield
Number of errors in waste transactions as a percent of total waste transactions The ratio of usable output from a process to its input.
RL.3.58
RL.3.59
Yield Variability
The condition that occurs when the output of a process is not consistently repeatable either in quantity, quality, or combination of these.
2.1.19
2.1.20
RS.1.1
Order Fulllment Cycle Time
The average actual cycle time consistently achieved to fulll customer orders. For each individual order, this cycle time starts from the order receipt and ends with customer acceptance of the order.
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Order Fulllment Cycle Time Source Cycle Time + Make Cycle Time + Deliver Cycle Time Calculation [Sum Actual Cycle Times For All Orders Delivered] / [Total Number Of Orders Delivered] Data Collection Data for the components that are used to drive the calculation of responsiveness are taken from the Source, Make and Deliver process elements. Discussion The order fulllment cycle time as captured from the moment a customer places the order to the moment the order is fullled is considered to be a gross cycle time. It represents all the time passed between these two events, regardless of whether this represented cycle time for the activities performed by the organization to fulll the order (both value-add and non-value-add) or dwell time because the order was placed well in advance by the customer. As such, this gross order fulllment cycle time does not truly reect the responsiveness of the organization. Take for example an organization that needs six days to fulll a certain customer order. If the customer places the order one day in advance, the gross order fulllment cycle time will be seven days. If the customer places the order 3 months ahead (pre-ordering), the gross fulllment cycle time will be 96 days. However, the fact that the customer pre-orders does not reduce the responsiveness of the organization. On the contrary, one can argue that it may increase the ability of the organization to meet that order as it allows the organization to plan ahead and fulll the order in a more optimal way. The responsiveness of the organization is determined by the cumulative cycle time for all activities that are required to fulll the order, but should exclude any dwell time where no activity takes place. Therefore the denition of Order Fulllment Cycle Time consists of a gross component and a net component named Order Fulllment Process Time, according to the following formula: Order Fulllment Cycle Time = Order Fulllment Process Time + Order Fulllment Dwell Time. Note that dwell time will equal 0 for companies who do not utilize this metric, so Order Fulllment Cycle Time will equal Order Fulllment Process Time. Order fulllment dwell time is dened as any lead time during the order fulllment process where no activity takes place, which is imposed by customer requirements. Note that this dwell time is dierent from idle time or non-value-add lead time, which is caused by ineciencies in the organizations processes and therefore ultimately under responsibility of the organization. This kind of idle time should not be deducted from the gross order fulllment cycle time.
2.2.1
RS.1.1
Discussion cont. Dwell time is mostly associated with the ordering process, where a customer may place an order in advance to reserve capacity/materials etc, but where the actual steps in the order fulllment process take place later on. It is also common in the delivery process where the organization may be in principle ready to ship the product/service, but is requested by the customer to wait (for example to follow a certain shipment schedule). Note that for those organizations where dwell time does not play a role, the dwell time can be taken as zero days which results in the net order fulllment cycle time to be equal to the gross order fulllment cycle time. For benchmarking purposes it is recommended to use the Order Fulllment Process Time, as this is the cycle time reecting most accurately the responsiveness of the organization. It will also ensure that those organizations in industries where dwell time is a factor can be benchmarked against organizations in industries where dwell time does not play a role. The concept of dwell time applies not only to the level 1 metric, but alsoto all lower level metrics. This means that each lower level metric can have a gross component, consisting of the net component and dwell time. Because the lower level metrics are heirarchical (the cumulative sum of cycle times at level 2 or 3 should be equal to the cycle time at level 1.) The cumulative sum of dwell times at level 2 or 3 should total up to the dwell time at level 1. Hierarchical Metric Structure
Level 1
RS.1.1 Order Ful llment Cycle Time RS.2.1 Source Cycle Time
Level 2
RS.2.2 Make Cycle time RS.2.3 Deliver Cycle Time
2.2.2
RS.2.1
Source Cycle Time
The average time associated with Source Processes. (Processes: S1, S2, S3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Source Cycle Time (Identify Sources of Supply Cycle Time + Select Supplier and Negotiate Cycle Time) + Schedule Product Deliveries Cycle Time + Receive Product Cycle Time + Verify Product Cycle Time + Transfer Product Cycle Time + Authorize Supplier Payment Cycle Time Calculation None Identied Data Collection None Identied Discussion Metrics in Level 3 that are used to drive the calculation of Source Cycle time are taken from the Source process elements, depending on the possible strategies deployed by companies to fulll orders such as make-to-stock, make-to-order or engineer-to-order. When make-to-stock or make-toorder strategy is deployed, the dashed optional metrics Identify Sources of Supply Cycle Time and Select Supplier and Negotiate Cycle Time are not used in the calculation. Hierarchical Metric Structure
Level 1 Level 2
RS.1.1 Order Ful llment Cycle Time RS.2.1 Source Cycle Time Identify Sources of Supply Cycle Time Select Supplier and Negotiate Cycle Time Schedule Product Deliveries Cycle Time
Level 3
Receive Product Cycle Time Verify Product Cycle Time Transfer Product Cycle Time Authorize Supplier Payment Cycle Time
The dashed line boxes represent optional metrics associated with specic level 3 processes.
2.2.3
RS.2.2
Make Cycle Time
The average time associated with Make Processes. (Processes: M1, M2, M3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Make Cycle Time (Finalize Production Engineering Cycle Time) + Schedule Production Activities Cycle Time + Issue Material/Product Cycle Time + Produce and Test Cycle Time + Package Cycle Time + Stage Finished Product Cycle Time + Release Finished Product To Deliver Cycle Time Calculation None Identied Data Collection None Identied Discussion Metrics in Level 3 that are used to drive the calculation of Make Cycle time are taken from the Make process elements, depending on the possible strategies deployed by companies to fulll orders such as make-to-stock, make-to-order or engineer-to-order. When make-to-stock or make-to-order strategy is deployed, the dashed optional metric Finalize Production Engineering Cycle Time is not used in the calculation. And also, the data for the calculation of Level 3 metrics may also depends on dierent make strategies, e.g., when make-to-stock strategy is deployed, the metric Issue Material/ Product Cycle Time means the time for issuing material; while when make-to-order or engineer-toorder is deployed, it will be a measure for calculating the cycle time for issuing sourced or in-process product. In Make Cycle Time, there may be overlaps in the processes, so the least amount of time should be applied rather than the total sum.
2.2.4
RS.2.2
Level 1 Level 2
RS.1.1 Order Ful llment Cycle Time RS.2.2 Make Cycle Time Schedule Production Activities Cycle Time Issue Material/Product Cycle Time Produce and Test Cycle Time
Level 3
Package Cycle Time Stage Finished Product Cycle Time Release Finished Product to Deliver Cycle Time Finalize Production Engineering Cycle Time
2.2.5
RS.2.3
Delivery Cycle Time
The average time associated with Deliver Processes. (Processes: D1, D2, D3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Delivery Cycle Time MAX {[Receive, Congure, Enter and Validate Order Cycle Time + Reserve Resources & Determine Delivery Date Cycle Time + (Consolidate Orders Cycle Time + Schedule Installation Cycle Time) + Build Loads Cycle Time + Route Shipments Cycle Time + Select Carriers and Rate Shipments Cycle Time], Receive Product from Make/Source Cycle Time} + Pick Product Cycle Time + Pack Product Cycle Time + Load Vehicle & Generate Shipping Documentation Cycle Time + Ship Product Cycle Time + (Receive & Verify Product Cycle Time) + (Install Product Cycle Time) *The MAX function above is to indicate that Dx.3-Dx.7 may be in parallel with Dx.8and whichever takes longer should determine the cycle time. Calculation None Idetied Data Collection None Identied Discussion Metrics in Level 3 that are used to drive the calculation of Deliver Cycle time are taken from the Deliver process elements, depending on the possible strategies deployed by companies to fulll orders such as make-to-stock, make-to-order or engineer-to-order. When make-to-stock or maketo-order strategy is deployed, the optional metric Schedule Installation Cycle Time is not used in the calculation, otherwise the metric Consolidate Orders Cycle Time will not be used. And also, the data for the calculation of Level 3 metrics may also depends on dierent make strategies, e.g., when make-to-stock strategy is deployed, the metric Receive, Congure, Enter and Validate Order Cycle Time may not include the Congure process.
2.2.6
RS.2.3
Level 1 Level 2
RS.1.1 Order Ful llment Cycle Time RS.2.3 Delivery Cycle Time Receive, Con gure, Enter & Validate Order Cycle Time Reserve Resources & Determine delivery Date Cycle Time Consolidate Orders Cycle Time Build Loads Cycle Time Rout Shipments Cycle Time Select Carriers and Rage Shipments Cycle Time Receive Product from Make/Source Cycle Time
Level 3
Install Product Cycle Time Receive & Verify Product Cycle Time Ship Product Cycle Time Load Vehicle & Generate Shipping Documentation Cycle Time Pack Product Cycle Time Pick Product Cycle Time Schedule Installation Cycle Time
2.2.7
RS.2.4
Delivery Retail Cycle Time
The average cycle time of the processes used to acquire, merchandise, and sell nished goods at a retail store. (Process: D4)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Delivery Retail Cycle Time Generate Stocking Schedule Cycle Time + Receive Product Cycle Time + Pick Product Cycle Time + Stock Shelf Cycle Time + Fill Shopping Cart Cycle Time + Checkout Cycle Time + Install Cycle Time Calculation None Identied Data Collection None Identied Discussion None Identied Hierarchical Metric Structure
Level 1 Level 2 RS.2.4 Delivery Retail Cycle Time Generate Stocking Schedule Cycle Time Receive Product Cycle Time Pick Product Cycle Time Level 3 Stock Shelf Cycle Time Install Cycle Time Checkout Cycle Time Fill Shopping Cart Cycle Time
2.2.8
RS
Level 3 Responsiveness Metrics
Metric ID
RS.3.1
Metric Name
Align Supply Chain Unit Plan with Financial Plan Cycle Time Assess Delivery Performance Cycle Time Assess Supplier Performance Cycle Time Asset Turns
Metric Denition
The average time associated with aligning the supply chain unit plan with the nancial plan The average time associated with assessing the performance of deliver processes. The average time associated with assessing the performance of supplier processes. Total gross product revenue Total net assets
Process
EP.10: Align Supply Chain Unit Plan with Financial Plan
RS.3.2
ED.2: Assess Delivery Performance
RS.3.3
ES.2: Assess Supplier Performance
RS.3.4
M1.4: Package M2.4: Package M3.5: Package M1.3: Produce and Test M2.3: Produce and Test, M3.4: Produce and Test DR1.1: Authorize Defective Product Return DR3.1: Authorize Excess Product Return DR2.1: Authorize MRO Product Return S1.5: Authorize Supplier Payment S2.5: Authorize Supplier Payment S3.7: Authorize Supplier Payment S1.1: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S1.1: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S1.1: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries P2.3: Balance Product Resources with Product Requirements
RS.3.5
Authorize Defective Product Return Cycle Time Authorize Excess Product Return Cycle Time Authorize MRO Product Return Cycle Time Authorize Supplier Payment Cycle Time Average Days per Engineering Change Average Days per Schedule Change Average Release Cycle of Changes Balance Product Resources with Product Requirements Cycle Time
The average time associated with authorizing the return of defective product. The average time associated with authorizing the return of excess product. The average time associated with authorizing the return of MRO product. The average time associated with authorizing payment to suppliers. # of days each engineering change impacts the delivery date divided by the total # of changes. # of days each schedule change impacts the delivery date divided by the total # of changes. Cycle time for implementing change notices divided by total number of changes. The average time associated with balancing product resources and product requirements.
RS.3.6
RS.3.7
RS.3.8
RS.3.9
RS.3.10
RS.3.11
RS.3.12
2.2.9
RS
Metric ID
RS.3.13
Metric Name
Balance Production Resources with Production Requirements Cycle Time Balance Return Resources with Return Requirements Cycle Time Balance Supply Chain Resources with Supply Chain Requirements Cycle Time Build Loads Cycle Time Checkout Cycle Time Consolidate Orders Cycle Time Current customer return order cycle time
Metric Denition
The average time associated with the identifying, prioritizing, and aggregating product requirements.
Process
P3.3: Balance Production Resources with Production Requirements
RS.3.14
The average time associated with balancing return resources and return requirements.
P5.3: Balance Return Resources with Return Requirements P5.2: Identify, Assess, and Aggregate Return Resources P1.3: Balance Supply Chain Resources with SC Requirements
RS.3.15
The average time associated with balancing supply chain resources and supply chain requirements.
RS.3.16
The average time associated with building shipment loads. The average time required for customer checkout. The average time required for customer order consolidation. Current return order cycle time, including customer return order processing cycle time, transit time, return processing and disposition cycle time, etc. Current logistics order cycle time, including customer order processing cycle time, dock-to-stock cycle time, pick-to-ship cycle, transit time, etc. Current manufacturing cycle time
D1.5: Build Loads D2.5: Build Loads D3.5: Build Loads D4.6: Checkout D1.4: Consolidate Orders D2.4: Consolidate Orders DR1: Deliver Return Defective Product, DR2: Deliver Return MRO Product, DR3: Deliver Return Excess Product D1: Deliver Stocked Product, D2: Deliver Make-to-Order Product, D3: Deliver Engineer-to-Order Product M1: Make-to-Stock, M2: Make-to-Order, M3: Engineer-to-Order SR1: Source Return Defective Product SR3: Source Return Excess Product ED.8: Manage Import/Export Requirements ES.8: Manage Import/Export Requirements D4.7: Deliver and/or Install
RS.3.17 RS.3.18 RS.3.19
RS.3.20
Current logistics order cycle time
RS.3.21
Current manufacturing order cycle time Current supplier return order cycle time Customs Clearance Cycle Time Deliver and/or Install Cycle Time
RS.3.22
Current supplier return order cycle time, including supplier return order processing cycle time, pick-to-ship cycle time, transit time etc. The average time associated with clearing an order through customs
RS.3.23
RS.3.24
The average time required to deliver and install product.
2.2.10
RS
Metric ID
RS.3.25
Metric Name
Enter Order, Commit Resources & Launch Program Cycle Time Establish and Communicate Return Plans Cycle Time Establish Delivery Plans Cycle Time Establish Production Plans Cycle Time Establish Sourcing Plans Cycle Time Establish Supply Chain Plans Cycle Time
Metric Denition
The average time associated with entering an order, committing resources and program launch
Process
D3.3: Enter Order, Commit Resources Launch Program
RS.3.26
The average time associated with establishing and communicating return plans The average time associated with establishing and communicating deliver plans The average time associated with establishing and communicating production plans The average time associated with establishing and communicating source plans Five point annual average of the sum of all gross inventories (raw materials & WIP, plant FG, eld FG, eld samples, other) (COGS 365). Total gross value of inventory at standard cost before reserves for excess and obsolescence. Only includes inventory on company books, future liabilities should not be included. The average response time (in days) to an external risk event from the time of the event (included detection lags)
P5.4: Establish and Communicate Return Plans
RS.3.27
P4.4: Establish Delivery Plans
RS.3.28
P3.4: Establish Production Plans
RS.3.29
P2.4: Establish Sourcing Plans
RS.3.30
P1.4: Establish & Communicate Supply-Chain Plans
RS.3.31
External Event Response (average days)
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk D4.5: Fill Shopping Cart M3.1: Finalize Production Engineering
RS.3.32 RS.3.33
Fill Shopping Cart Cycle Time Finalize Production Engineering Cycle Time Generate Stocking Schedule Cycle Time
The average time associated with lling the shopping cart The average time associated with the nalization of production engineering
RS.3.34
The average time associated with the generating a stocking schedule
D4.1: Generate Stocking Schedule
2.2.11
RS
Metric ID
RS.3.35
Metric Name
Identify Sources of Supply Cycle Time Identify, Assess and Aggregate Production Resources Cycle Time Identify, Assess, and Aggregate Delivery Resources Cycle Time Identify, Assess, and Aggregate Product Resources Cycle Time Identify, Assess, and Aggregate Supply Chain Resources Cycle Time Identify, Prioritize, and Aggregate Delivery Requirements Cycle Time Identify, Prioritize, and Aggregate Product Requirements Cycle Time Identify, Prioritize, and Aggregate Production Requirements Cycle Time Identify, Prioritize, and Aggregate Return Requirements Cycle Time
Metric Denition
The average time associated with the identication of sources of supply The average time associated with the identifying, prioritizing, and aggregating product requirements.
Process
S3.1: Identify Sources of Supply
RS.3.36
P3.2: Identify, Assess and Aggregate Production Resources
RS.3.37
The average time associated with the identifying, assessing, and aggregating delivery resource availability
P4.2: Identify, Assess and Aggregate Delivery Resources P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements P3.2: Identify, Assess and Aggregate Production Resources P2.2: Identify, Assess and Aggregate Product Resources P1.2: Identify, Prioritize and Aggregate SC Resources
RS.3.38
The average time associated with the identifying, assessing, and aggregating product resource availability
RS.3.39
The average time associated with the identifying, assessing, and aggregating supply chain resource availability
RS.3.40
The average time associated with the identifying, prioritizing, and aggregating delivery requirements
P4.1: Identify, Prioritize and Aggregate Delivery Requirements
RS.3.41
The average time associated with the identifying, prioritizing, and aggregating product requirements
P2.1: Identify, Prioritize and Aggregate Product Requirements
RS.3.42
The average time associated with the identifying, prioritizing, and aggregating production requirements
P3.1: Identify, Prioritize and Aggregate Production Requirements
RS.3.43
The average time associated with the identifying, prioritizing, and aggregating return requirements
P5.1: Assess and Aggregate Return Requirements
2.2.12
RS
Metric ID
RS.3.44
Metric Name
Identify, Prioritize, and Aggregate Supply Chain Requirements Cycle Time Install Product Cycle Time In-stock %
Metric Denition
The average time associated with the identifying, prioritizing, and aggregating supply chain requirements
Process
P1.1: Identify, Prioritize and Aggregate SC Requirements
RS.3.46
The average time associated with product installation Percentage of materials, components, or nished goods that are there when needed. The average time associated with the generation and issuance of an invoice The average time associated with the issuance of material to production The average time associated with the issuance of material to production
D1.14: Install Product D2.14: Install Product D3.14: Install Product D4.4: Stock Shelf
RS.3.47
RS.3.48 RS.3.49 RS.3.50
Invoice Cycle Time Issue Material Cycle Time Issue Sourced/InProcess Product Cycle Time Load Product & Generate Shipping Documentation Cycle Time Load Vehicle and Generate Shipping Documentation Cycle Time Maintain Source Data Cycle Time Manage Business Rules for PLAN Processes Cycle Time Manage Business Rules for Return Processes Cycle Time Manage Capital Assets Cycle Time Manage Deliver Business Rules Cycle Time
D1.15: Invoice D3.15: Invoice M1.2: Issue Material M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents D1.11: Load Vehicle & Generate Shipping Documentation
RS.3.51
The average time associated with product loading and the generation of shipping documentation
RS.3.52
The average time associated with product loading and the generation of shipping documentation
RS.3.53 RS.3.54
The average time associated with maintaining source data The average time associated with managing plan business rules
ES.3: Maintain Source Data EP.1: Manage Business Rules for Plan Processes
RS.3.55
The average time associated with managing rules for returns
ER.1: Manage Business Rules for Return Processes
RS.3.56 RS.3.57
The average time associated with managing capital assets The average time associated with managing deliver business rules
ES.5: Manage Capital Assets ED.1: Manage Deliver Business Rules
2.2.13
RS
Metric ID
RS.3.58
Metric Name
Manage Deliver Capital Assets Cycle Time Manage Deliver Information Cycle Time Manage Finished Goods Inventories Cycle Time Manage Import/Export Requirements Cycle Time Manage Incoming Product Cycle Time Manage InProcess Products (WIP) Cycle Time Manage Integrated Supply Chain Capital Assets Cycle Time Manage Integrated Supply Chain Inventory Cycle Time Manage Integrated Supply Chain Transportation Cycle Time Manage MAKE Equipment and Facilities Cycle Time Manage MAKE Information Cycle Time Manage MAKE Regulatory Compliance Cycle Time
Metric Denition
The average time associated with managing deliver capital assets The average time associated with managing deliver information The average time associated with managing nished good inventory The average time associated with managing import/export requirements
Process
ED.5: Manage Deliver Capital Assets ED.3: Manage Deliver Information
RS.3.59
RS.3.60
ED.4: Manage Finished Goods Inventories ED.8: Manage Import/Export Requirements ES.8: Manage Import/Export Requirements ES.6: Manage Incoming Product
RS.3.61
RS.3.62
The average time associated with managing inbound raw material The average time associated with managing WIP inventory The average time associated with managing integrated supply chain capital assets The average time associated with managing integrated supply chain inventory The average time associated with managing integrated supply chain transportation
RS.3.63
EM.4: Manage In-Process Products (WIP) EP.5: Manage Integrated Supply Chain Capital Assets
RS.3.64
RS.3.65
EP.4: Manage Integrated Supply Chain Inventory
RS.3.66
EP.6: Manage Integrated Supply Chain Transportation
RS.3.67
The average time associated with managing production equipment and facilities The average time associated with managing production information The average time associated with managing compliance to the make regulatory environment
EM.5: Manage Make Equipment and Facilities
RS.3.68
EM.3: Manage Make Information
RS.3.69
2.2.14
RS
Metric ID
RS.3.70
Metric Name
Manage Performance of Return Processes Cycle Time Manage Performance of Supply Chain Cycle Time Manage PLAN Data Collection Cycle Time Manage Plan Regulatory Requirements and Compliance Cycle Time Manage Planning Conguration Cycle Time Manage Product Inventory Cycle Time Manage Product Life Cycle Time Manage Production Network Cycle Time Manage Production Performance Cycle Time Manage Production Rules Cycle Time Manage Return Capital Assets Cycle Time Manage Return Data Collection Cycle Time Manage Return Inventory Cycle Time
Metric Denition
The average time associated with managing the performance of supply chain activities The average time associated with managing the performance of return activities The average time associated with collecting plan data The average time associated with managing the planning of regulatory requirements and compliance
Process
ER.2: Manage Performance of Return Processes
RS.3.71
EP.2: Manage Performance of Supply Chain
RS.3.72
EP.3: Manage Plan Data Collection
RS.3.73
EP.8: Manage Plan Regulatory Requirements and Compliance
RS.3.74
The average time associated with managing the planning of the supply chain conguration The average time associated with managing raw material inventory The average time associated with managing the product life cycle The average time associated with managing the production network
EP.7: Manage Planning Conguration ES.4: Manage Product Inventory
RS.3.75
RS.3.76 RS.3.77
ED.7: Manage Product Life Cycle EM.7: Manage Production Network
RS.3.78
The average time associated with managing production performance
EM.2: Manage Production Performance
RS.3.79
The average time associated with managing production rules The average time associated with managing return capital assets The average time associated with managing return data collection The average time associated with managing return inventory
EM.1: Manage Production Rules
RS.3.80
EM.5: Manage Return CapitalAssets
RS.3.81
ER.3: Manage Return Data Collection ER.4: Manage Return Inventory
RS.3.82
2.2.15
RS
Metric ID
RS.3.83
Metric Name
Manage Return Network Conguration Cycle Time Manage Return Regulatory Requirements and Compliance Cycle Time Manage Return Transportation Cycle Time Manage Sourcing Business Rules Cycle Time Manage Supplier Agreements Cycle Time Manage Supplier Network Cycle Time Manage Transportation (WIP) Cycle Time Manage Transportation Cycle Time Manufacturing cycle time reestablished and sustained for 30 days Negotiate & Receive Contract Cycle Time Obtain & Respond to Request for Quote (RFQ) / Request for Proposal (RFP) Cycle Time
Metric Denition
The average time associated with managing the return network conguration The average time associated with compliance and regulatory requirements for return products
Process
ER.7: Manage Return Network Conguration
RS.3.84
RS.3.85
The average time associated with managing return transportation The average time associated with managing source business rules The average time associated with managing supplier agreements The average time associated with managing the supplier network The average time associated with managing (WIP) transportation The average time associated with managing transportation The average time associated with managing transportation
ER.6: Manage Return Transportation ES.1: Manage Sourcing Business Rules ES.10: Manage Supplier Agreements ES.7: Manage Supplier Network
RS.3.86
RS.3.87
RS.3.88
RS.3.89
EM.6: Manage Transportation (WIP)
RS.3.90
ED.6: Manage Transportation
RS.3.91
EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network D3.2: Negotiate and Receive Contract D3.1: Obtain and Respond to RFP/ RFQ
RS.3.92
The average time associated with negotiating and receiving a contract The average time associated with obtaining and responding to RFQs/RFPs
RS.3.93
2.2.16
RS
Metric ID
RS.3.94
Metric Name
Order Fulllment Dwell Time
Metric Denition
Any lead time during the order fulllment process where no activity takes place, which is imposed by customer requirements. Note that this dwell time is dierent from idle time or non-value-add lead time, which is caused by ineciencies in the organizations processes and therefore ultimately under responsibility of the organization. This kind of idle time should not be deducted from Order Fulllment Cycle Time. The average time associated with packing a product for shipment. The average time associated with product pick The average time associated with product pick from backroom The average time associated with Plan Processes The average time associated with planning source activities The average time associated with processing inquiries and quotes The average time associated with production and test The average time associated with receiving and verifying an order at the customer site
Process
D1.2: Receive, Enter and Validate Order D1.3: Reserve Inventory and Determine Delivery Date D2.2: Receive, Congure, Enter and Validate Order D2.3: Reserve Inventory and Determine Delivery Date D3.3: Enter Order, Commit Resources Launch Program
RS.3.95
Pack Product Cycle Time Pick Product Cycle Time Pick Product from Backroom Cycle Time Plan Cycle Time Plan Source Cycle Time Process Inquiry & Quote Cycle Time Produce and Test Cycle Time Receive & Verify Product by Customer Cycle Time
D1.10: Pack Product D2.10: Pack Product D3.10: Pack Product D1.9: Pick Product D2.9: Pick Product D3.9: Pick Product D4.3: Pick Product from Backroom
RS.3.96
RS.3.97
RS.3.98 RS.3.99 RS.3.100 RS.3.101
P1: Plan Supply Chain P2: Plan Source D1.1: Process Inquiry and Quote D2.1: Process Inquiry and Quote M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test D1.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D3.13: Receive and Verify Product by Customer D1.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D3.13: Receive and Verify Product by Customer DR1.3: Receive Defective Product
RS.3.102
RS.3.103
Receive and Verify Product Cycle Time
The average time associated with receiving and verifying an order at the customer site
RS.3.104
Receive Defective Product Cycle Time
The average time associated with receiving defective product returns from the customer
2.2.17
RS
Metric ID
RS.3.105
Metric Name
Receive Excess Product Cycle Time Receive MRO Product Cycle Time Receive Product Cycle Time Receive Product from Make/ Source Cycle Time
Metric Denition
The average time associated with receiving excess product returns from the customer The average time associated with receiving MRO product returns from the customer The average time associated with receiving product The average time associated with receiving product from Make/Source
Process
DR3.3: Receive Excess Product
RS.3.106
DR2.3: Receive MRO Product
RS.3.107 RS.3.108
D4.2: Receive Product at the Store D1.8: Receive Product from Source or Make D2.8: Receive Product from Source or Make D3.8: Receive Product from Source or Make D4.2: Receive Product at the Store
RS.3.109
Receive Product at Store Cycle Time Receive Product from Source or Make Cycle Time
The average time associated with receiving product at the customer store The average time associated with receiving a transfer of product to deliver processes from source or make
RS.3.110
D1.8: Receive Product from Source or Make D2.8: Receive Product from Source or Make D3.8: Receive Product from Source or Make D2.2: Receive, Congure, Enter and Validate Order
RS.3.111
Receive, Congure, Enter & Validate Order Cycle Time Receive, Enter & Validate Order Cycle Time Receiving Product Cycle Time Release Finished Product to Deliver Cycle Time Reserve Inventory & Determine Delivery Date Cycle Time
The average time associated with receiving and verifying an order at the customer site The average time associated with receiving and verifying an order at the customer site Total elapsed time from time product is received to time it is passed to next process The average time associated with releasing nished product to deliver
RS.3.112
D1.2: Receive, Enter and Validate Order S1.2: Receive Product S2.2: Receive Product S3.4: Receive Product M1.6: Release Product to Deliver M2.6: Release Finished Product to Deliver M3.7: Release Product to Deliver D2.3: Reserve Inventory and Determine Delivery Date
RS.3.113
RS.3.114
RS.3.115
The average time associated with reserving inventory and determining a delivery date
2.2.18
RS
Metric ID
RS.3.116
Metric Name
Reserve Resources and Determine Delivery Date Cycle Time Route Shipments Cycle Time Schedule Defective Return Receipt Cycle Time Schedule Excess Return Receipt Cycle Time Schedule Installation Cycle Time Schedule MRO Return Receipt Cycle Time Schedule Product Deliveries Cycle Time Schedule Production Activities Cycle Time
Metric Denition
The average time associated with reserving resources and determining a delivery date
Process
D1.3: Reserve Inventory and Determine Delivery Date D2.3: Reserve Inventory and Determine Delivery Date D1.6: Route Shipments D2.6: Route Shipments D3.6: Route Shipments DR1.2: Schedule Defective Return Receipt
RS.3.117
The average time associated with routing shipments The average time associated with scheduling the receipt of the return of defective product The average time associated with scheduling the receipt of the return of excess product The average time associated with scheduling the installation of product The average time associated with scheduling the receipt of the return of MRO product The average time associated with scheduling the shipment of the return of MRO product The average time associated with scheduling production activities
RS.3.118
RS.3.119
DR3.2: Schedule Excess Return Receipt D3.4: Schedule Installation
RS.3.120
RS.3.121
DR2.2: Schedule MRO Return Receipt S1.1: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries M1.1: Schedule Production Activities M2.1: Schedule Production Activities M3.2: Schedule Production Activities D1.7: Select Carriers and Rate Shipments D1.7: Select Carriers and Rate Shipments D3.7: Select Carriers & Rate Shipments S3.2: Select Final Supplier(s) and Negotiate D1.12: Ship Product D2.12: Ship Product D3.12: Ship Product SR1: Source Return Defective Product SR3: Source Return Excess Product
RS.3.122
RS.3.123
RS.3.124
Select Carriers & Rate Shipments Cycle Time
The average time associated with selecting carriers and rating shipments
RS.3.125
Select Supplier and Negotiate Cycle Time Ship Product Cycle Time Source Return Cycle Time
The average time associated with selecting a suppliler and negotiating The average time associated with shipping product Average time associated with Sourcing Return
RS.3.126
RS.3.127
2.2.19
RS
Metric ID
RS.3.128
Metric Name
Stage Finished Product Cycle Time Stock Shelf Cycle Time Supply chain down time due to compliance issues
Metric Denition
The average time associated with staging nished product The average time associate with stocking shelves Time the supply chain is disrupted by environmental compliance issues divided by the total potential available time
Process
M1.5: Stage Product M2.5: Stage Finished Product M3.6: Stage Finished Product D4.4: Stock Shelf EP.8: Manage Plan Regulatory Requirements and Compliance, ES.8: Manage Import/Export Requirements EM.8: Manage Make Regulatory Environment ED.8: Manage Import/Export Requirements ER.8: Manage Return Regulatory Requirements and Compliance ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration ED.5: Manage Deliver Capital Assets, ED.6: Manage Transportation
RS.3.129 RS.3.130
RS.3.131
Time to reach and sustain current customer return order cycle time
Amount of time needed to reach and sustain current customer return order cycle time, including customer return order processing cycle time, transit time, return processing and disposition cycle time, etc. Amount of time needed to reach and sustain current logistics order cycle time, including customer order processing cycle time, dock-to-stock cycle time, pick-to-ship cycle time, transit time, etc. Amount of time needed to reach and sustain current manufacturing cycle time Amount of time needed to reach and sustain current procurement cycle time, including time to place a purchase order and supplier lead time Amount of time needed to reach and sustain current supplier return order cycle time, including supplier return order processing cycle time, pick-toship cycle time, transit time, etc. The average time associated transfer until product is moved to the next process.
RS.3.132
Time to reach and sustain current logistics order cycle time
RS.3.133
Time to reach and sustain current manufacturing order cycle time Time to reach and sustain current purchase order cycle time Time to reach and sustain current supplier return order cycle time Transfer Defective Product Cycle Time
EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network ES.5: Manage Source Capital Assets ES.6: Manage Incoming Product ES.7: Manage Supplier Network ES.10: Manage Supplier Agreements ES.5: Manage Source Capital Assets ES.6: Manage Incoming Product ES.7: Manage Supplier Network ES.10: Manage Supplier Agreements DR1.4: Transfer Defective Product
RS.3.134
RS.3.135
RS.3.136
2.2.20
RS
Metric ID
RS.3.137
Metric Name
Transfer Excess Product Cycle Time Transfer MRO Product Cycle Time Transfer Product Cycle Time Verify Product Cycle Time Waste accumulation time
Metric Denition
The average time associated transfer until product is moved to the next process. The average time associated transfer until product is moved to the next process. The average time associated transfer until product is moved to the next process. The average time associated with verifying raw material product The time required to collect and properly store production waste
Process
DR3.4: Transfer Excess Product
RS.3.138
DR2.4: Transfer MRO Product
RS.3.139
S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product S1.3: Verify Product S2.3: Verify Product S3.5: Verify Product M1.7: Waste Disposal M2.7: Waste Disposal M3.8: Waste Disposal
RS.3.140
RS.3.141
2.2.21
2.2.22
AG.1.1
Upside Supply Chain Flexibility
The number of days required to achieve an unplanned sustainable 20% increase in quantities delivered. Note - 20% is a number provided for benchmarking purposes. For some industries and some organizations 20% may be in some cases unobtainable or in others too conservative. Note - component metrics (Upside Source Flexibility, Upside Make Flexibility, etc) can be improved in parallel and as a result, this calculation requires the result to be the least amount of time to achieve the desired result).
Qualitative Relationship Description Calculation: Total elapsed days between the occurrence of the unplanned event and the achievement of sustained plan, source, make, deliver and return performance. Note: Elapsed days are not necessarily the sum of days required for all activities as some may occur simultaneously. AG.2.1 Upside Source Flexibility: The number of days required to achieve an unplanned sustainable 20% increase in quantity of raw materials. AG.2.2 Upside Make Flexibility: The number of days required to achieve an unplanned sustainable 20% increase in production with the assumption of no raw material constraints. AG.2.3 Upside Deliver Flexibility: The number of days required to achieve an unplanned sustainable 20% increase in quantity delivered with the assumption of no other constraints. AG.2.4 Upside Source Return Flexibility: The number of days required to achieve an unplanned sustainable 20% increase in the return of raw materials to suppliers. AG.2.5 Upside Deliver Return Flexibility: The number of days required to achieve an unplanned sustainable 20% increase in the return of nished goods from customers. Quantitative Relationship (optional, if calculable) None Identied Calculation The calculation of supply chain exibility requires the calculation to be the least time required to achieve the unplanned sustainable increase when considering Source, Make, and Deliver components. For example, if it requires 90 days achieve a 20% increase in raw material volume, 60 days for adding capital to support production, and no time to increase the ability to deliver, upside supply chain exibility would be 90 days (if production changes can run concurrently with material acquisition activities) or as much as 150 days if production changes and material acquisition changes must run sequentially.
2.3.1
AG.1.1
Data Collection Data for the components that are used to drive the calculation of supply chain exibility are taken from the actual planning activities incurred in devising the actions to be taken and the execution activities themselves. Neither the complete set of activities nor any given subset of those activities can be identied except in either contingency plans (in which case they are hypothetical), special analytical simulations conducted for the purpose of predicting total elapsed time, or after the fact (when they have actually occurred and are unlikely to reoccur in the same combination). Flexibility measures are assumption based or based on historic events. Some elements can be measured and taken as a basis for further considerations, e.g. Discussion Certainly enterprises deal with change all the time. In most cases, these changes are minor deviations from the norm or eeting blips in the marketplace. Also, certainly, most supply chains move through these changes almost eortlessly and, in this regard, demonstrate equivalent exibility. In many extreme cases, however, it is possible that a particular supply chain has reached a condition of relative rigidity (say, at capacity or rigid, constraining agreements with partners) and a seemingly minor increase in production requirement can consume much time and eort as the supply chain struggles to restore its capability to perform. It is evidenced that enterprises engaged in appropriate business risk and competitive contingency planning activities will usually be in a better position to optimize overall supply chain performance and these activities are presented as best practices later in this document. When change is known in advance (such as Wal-Mart requiring RFID devices on all delivered cases, or a major sourcing change is planned to occur), and is incorporated in the enterprises operating plan, then the time incurred to undertake the adaptation isnt necessarily a reection of the supply chains exibility. While exibility is still addressed, it is frequently clouded by other considerations in the operating plan. Unplanned change is the primary consideration in measuring the supply chains exibility. Hierarchical Metric Structure
Level 1
AG1.1 Upside Supply Chain Flexibility AG.2.1 Upside Source Flexiblity AG.2.2 Upside Make Flexibility
Level 2
AG.2.3 Upside Deliver Flexibility AG.2.4 Upside Source Return Flexibility AG.2.5 Upside Deliver Return Flexibility
2.3.2
AG.1.2
Upside Supply Chain Adaptability
The maximum sustainable percentage increase in quantity delivered that can be achieved in 30 days. Note: 30 days is an arbitrary number provided for benchmarking purposes. For some industries and some organizations 30 days may be in some cases unobtainable or in others too conservative. Note: Component metrics (Upside Source Adaptability, Upside Make Adaptability, etc) can be improved in parallel and as a result, this calculation requires the result to be the least increase in quantity sustainable in 30 days
Qualitative Relationship Description Note: The calculation of Supply Chain Adaptability requires the calculation to be the least quantity sustainable when considering Source, Make, Deliver and Return components. AG.2.6 Upside Source Adaptability: The maximum sustainable percentage increase in raw material quantities that can be acquired/received in 30 days. AG.2.7 Upside Make Adaptability: The maximum sustainable percentage increase in production that can be achieved in 30 days with the assumption of no raw material constraints. AG.2.8 Upside Deliver Adaptability: The maximum sustainable percentage increase in quantities delivered that can be achieved in 30 days with the assumption of unconstrained nished good availability. AG.2.9 Upside Source Return Adaptability: The maximum sustainable percentage increase in returns of raw materials to suppliers that can be achieved in 30 days with the assumption of unconstrained nished goods availability. AG.2.10 Upside Deliver Return Adaptability: The maximum sustainable percentage increase in returns of nished goods from customers that can be achieved in 30 days. Quantitative Relationship (optional, if calculable) Upside Source Adaptability + Upside Make Adaptability + Upside Deliver Adaptability Calculation None Identied Data Collection Adaptability measures are assumption based or based on historic events. Some elements can be measured and taken as a basis for further considerations. Adaptability measures are based on the actual number of returns compared to the maximum number of returns which can be achieved within 30 days. The weakest component determines the overall volume.
2.3.3
AG.1.2
Discussion The calculation of Supply Chain Adaptability requires the calculation to be the least quantity sustainable when considering Source, Make, Deliver and Return components. o P&L Impact ! Revenue ! COGS ! SGA o Balance Sheet Impact ! Inventory Hierarchical Metric Structure
Level 1
AG1.2 Upside Supply Chain Adaptability AG.2.6 Upside Source Adaptability AG.2.7 Upside Make Adaptability
Level 2
AG.2.8 Upside Deliver Adaptability AG.2.9 Upside Source Return Adaptability AG.2.10 Upside Deliver Return Adaptability
2.3.4
AG.1.3
Downside Supply Chain Adaptability
The reduction in quantities ordered sustainable at 30 days prior to delivery with no inventory or cost penalties. Note: 30 days is an arbitrary number provided for benchmarking purposes. For some industries and some organizations 30 days may be in some cases unobtainable or in others too conservative.
Qualitative Relationship Description The calculation of downside supply chain adaptability requires the calculation to be based on the least reduction sustainable when considering Source, Make, and Deliver components. AG.2.11 Downside Source Adaptability: The raw material quantity reduction sustainable at 30 days prior to delivery with no inventory or cost penalties. AG.2.12 Downside Make Adaptability: The production reduction sustainable at 30 days prior to delivery with no inventory or cost penalties. AG.2.13 Downside Deliver Adaptability: The reduction in delivered quantities sustainable at 30 days prior to delivery with no inventory or cost penalties. Quantitative Relationship (optional, if calculable) Downside Source Adaptability + Downside Make Adaptability + Downside Deliver Adaptability Calculation None Identied Data Collection Adaptability measures are assumption based on historic events. Some elements can be measured and taken as a basis for further considerations. Discussion The calculation of Supply Chain Adaptability requires the calculation to be the least quantity sustainable when considering Source, Make, Deliver and Return components. o P&L Impact ! Revenue ! COGS ! SGA o Balance Sheet Impact ! Inventory
2.3.5
AG.1.3
Level 1
AG.1.3 Downside Supply Adaptability AG.2.11 Downside Source Adaptability
Level 2
AG.2.12 Downside Make Adaptability AG.2.13 Downside Deliver Adaptability
2.3.6
AG.2.1
Upside Source Flexibility
The number of days required to achieve an unplanned sustainable 20% increase in quantity of raw materials. Note: This is a planning activity normally considering constraints to increase delivery that results in an estimate. Possible constraint factors are included in this section.
Qualitative Relationship Description Least time to pursue all necessary activities. Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Source: Input Current elements needed to fully understand future requirements, to establish 20% gap, based on the question How long will it take for the company to sustain a 20% increase in quantities sourced?. These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current source volumes ! Amount of each item purchased Stang o Sta needed to meet current demand ! Productivity-purchase orders per FTE ! Needed, but may be underutilized Capital o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures Materials o All else equal in make, deliver, return, current inventory on hand (raw material and purchased nished goods), including safety stock required to sustain current order fulllment. ! Assuming optimized inventory practices (no excess inventory) o Current sourcing/supplier constraints ! Current contract terms. ! Nature of items; commodity/sole source.
2.3.7
AG.2.1
Discussion cont. Cycle Time o Current procurement cycle time ! Time to place a purchase order Supplier lead time Source: Resource Availability Assessment & Ramp-up/Lead Time Elements needed to establish 20% delta in resources and what is required to meet the 20% delta based on the question How long will it take for the company to sustain a 20% increase in quantities sourced? Demand o Additional source volume Stang o Sta availability in procurement (underutilized FTEs) o Amount of time needed to recruit/hire/train additional sta to ll gap between underutilized FTEs and sta needed to sustain 20% increase in quantities delivered Capital o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures o Amount of time needed to obtain capital to ll gap between current capital availability and capital needed to sustain 20% increase in quantities ordered Materials o Sourcing Constraints ! Time required in negotiating new source/volume contracts/terms ! Time required to nd/obtain additional sources o All else equal in make, deliver, return, amount of time needed to obtain, deliver and phase in inventory (raw material and purchased nished goods) for order fulllment, including safety stock to sustain 20% increase in quantities sourced. Cycle Time o Amount of time needed to reach and sustain current procurement cycle time ! Time to place a purchase order ! Supplier lead time
2.3.8
AG.2.1
Level 1 Level 2
AG.1.1 Upside Supply Flexibility AG.2.1 Upside Source Flexibility Current source volumes Productivity-purchase orders per FTE Current capital requirements Current on-hand inventories (Raw, Purchased FG) Current sourcing/supplier constraints Current purchase order cycle times Additional source volumes
Level 3
Procurement sta availablity Time needed to recruit/hire/train additional sta Capital availability Time needed to obtain additional capital Additional demand sourcing - supplier constraints Time needed to increase inventory for additional order ful llment (Raw, Purchased FG) Time to reach and sustain current purchase order cycle time
2.3.9
AG.2.2
Upside Make Flexibility
The number of days required to achieve an unplanned sustainable 20% increase in production with the assumption of no raw material constraints. Note: This is a planning activity normally considering constraints to increase delivery that results in an estimate.
Qualitative Relationship Description Least time to pursue all necessary activities. Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Make: Input Current elements needed to fully understand future requirements, to establish 20% gap, based on the question How long will it take for the company to sustain a 20% increase in quantities produced?. These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current make volumes ! Amount of each item manufactured Labor o Labor needed to meet current demand ! Productivity-units/orders per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (outsourced) capacity needed for current demand throughput ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) Materials o All else equal in source, deliver and return, current inventory on hand (WIP and nished goods), including safety stock required to sustain current order fulllment.
2.3.10
AG.2.2
Discussion cont. ! Assuming optimized inventory practices (no excess inventory) Cycle Time o Current manufacturing cycle time (all else equal including procurement order cycle time and supplier lead time) Make: Resource Availability Assessment & Ramp-up/Lead Time Elements needed to establish 20% delta in resources and what is required to meet the 20% delta based on the question How long will it take for the company to sustain a 20% increase in quantities produced? Demand o Additional make volume Labor o Direct labor availability and percent of labor used in manufacturing, not used in direct activity (underutilized FTEs) o Amount of time needed to recruit/hire/train additional labor to ll gap between underutilized FTEs and labor needed to sustain 20% increase in quantities manufactured Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o Amount of time needed to obtain capital to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities delivered o Amount of time needed to obtain assets/capacity to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities delivered ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! Facilities, lease building, etc. ! Lease manufacturing equipment, materials handling and packaging equipment, etc. ! Co-packers o Amount of time needed to obtain supplemental outsourced or leased resources or facilities to sustain 20% increase in quantities made Materials o All else equal in source, deliver and return, amount of time needed to receive and phase in raw material inventory for manufacturing and make WIP and FG inventory, including safety stock to sustain 20% increase in quantities manufactured) Cycle Time o Amount of time needed to reach and sustain current manufacturing cycle time (all else equal including procurement order cycle time and supplier lead time)
2.3.11
AG.2.2
Level 1 Level 2
AG.1.1 Upside Supply Flexibility AG.2.2 Upside Make Flexibility

Current make volume Productivity-units/orders produced per FTE Internal and External manufacturing equipment capacity needed for current make volume Internal and External facilities/, storage capacity needed for current make volume Current capital requirements Current inventory on hand (WIP, FG) Current manufacturing order cycle time Additional make volume Direct labor activity Percent of labor used in manufacturing, not used in direct activity
Level 3
Time needed to recruit/hire/train additional labor Current internal equipment capacity utilization Current internal facility/storage capacity utilization Capital availablitly Time needed to obtain additional capital Time needed to obtain additional internal space Supplemental outsource/lease availability Time needed to obtain supplemental outsourced or leased resources or facilities Time needed to increase inventory (WIP, FG) Time to reach and sustain current manufacturing order cycle time Capital availablitly
2.3.12
AG.2.3
Upside Deliver Flexibility
The number of days required to achieve an unplanned sustainable 20% increase in quantity delivered with the assumption of no other constraints. Note: This is a planning activity normally considering constraints to increase delivery that results in an estimate.
Qualitative Relationship Description Least time to pursue all necessary activities. Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Deliver: Input Current elements needed to fully understand future requirements, to establish 20% gap, based on the question How long will it take for the company to sustain a 20% increase in quantities delivered?. These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current delivery volume ! Number of orders shipped Labor o Labor needed to meet current demand ! Productivity-orders per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current demand throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized Current capital requirements o Credit line o Cash on hand o Accounting procedures o Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) Materials o All else equal in source, make, return, current nished goods inventory on hand (including safety stock required to sustain current order fulllment)
2.3.13
AG.2.3
Discussion cont. ! Assuming optimized inventory practices (no excess inventory) Cycle Time o Current logistics order cycle time (all else equal including procurement order cycle time, supplier lead time, manufacturing cycle time, etc.) ! Customer order processing cycle time (logistics only) ! Dock-to-stock cycle time ! Pick-to-ship cycle time ! Transit time Deliver: Resource Availability Assessment & Ramp-up/Lead Time Elements needed to establish 20% delta in resources and what is required to meet the 20% delta based on the question How long will it take for the company to sustain a 20% increase in quantities delivered? Demand o Additional delivery volume Labor o Direct labor availability and percent of labor used in logistics, not used in direct activity (underutilized FTEs) o Amount of time needed to recruit/hire/train additional labor to ll gap between underutilized FTEs and labor needed to sustain 20% increase in quantities delivered Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o Amount of time needed to obtain capital to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities delivered o Amount of time needed to obtain assets/capacity to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities delivered ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o Amount of time needed to obtain supplemental outsourced or leased resources or facilities to sustain 20% increase in quantities delivered Materials o All else equal in source, make, return, amount of time needed to increase nished inventory for order fulllment (time to receive/stock inventory, including safety stock to sustain 20% increase in quantities delivered)
2.3.14
AG.2.3
Discussion cont. Cycle Time o Amount of time needed to reach and sustain current logistics order cycle time (all esle equal including procurement order cycle time, supplier lead time, manufacturing cycle time, etc.) ! Customer order processing cycle time (logistics only) ! Dock-to-stock cycle time ! Pick-to-ship cycle time ! Transit time
2.3.15
AG.2.3
Level 1 Level 2
AG.1.1 Upside Supply Flexibility AG.2.3 Upside Make Flexibility

Current delivery volume Productivity-orders produced per FTE Internal and External (3PL) Equipment capacity needed for current delivery volume Internal and External (3PL) storage capacity needed for current delivery volume Current capital requirements Current inventory on hand ( FG) Current logistics order cycle time Additional delivery volume Direct labor activity Percent of labor used in logistics, not used in direct activity Time needed to recruit/hire/train additional labor
Level 3
Current internal equipment capacity utilization Current internal storage capacity utilization Capital availablitly Time needed to obtain additional capital Time needed to obtain additional equipment Time needed to obtain additional internal space Supplemental outsource/lease availability Time needed to obtain supplemental outsourced (3PL) or leased resources or facilities Time needed to increase inventory (FG) for order ful llment Time to reach and sustain current logistics order cycle time
2.3.16
AG.2.4
Upside Source Return Flexibility
The number of days required to achieve an unplanned sustainable 20% increase in the return of raw materials to suppliers.
Note: This is a planning activity normally considering constraints to increase delivery that results in an estimate. Data Collection None Identied Discussion Source Return: Input Assuming no supplier constraints, current elements needed to fully understand future requirements, to establish 20% gap, based on the question How long will it take for the company to sustain a 20% increase in quantities returned to suppliers? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand ! Current return volume ! Number of orders returned Sta / Labor o Procurement Sta / Logistics Labor needed to meet current returned volume ! Productivity-orders returned per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current return throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) Cycle Time o Current supplier return order cycle time ! Supplier return order processing cycle time (procurement and logistics) ! Pick-to-ship cycle time ! Transit time
2.3.17
AG.2.4
Discussion cont. Source Return: Resource Availability Assessment & Ramp-up/Lead Time Assuming no supplier constraints, elements needed to establish 20% delta in resources and what is required to meet the 20% delta based on the question How long will it take for the company to sustain a 20% increase in quantities returned to suppliers? Demand o Additional supplier return volume Sta / Labor o Procurement sta / Logistics labor availability (underutilized FTEs) o Amount of time needed to recruit/hire/train additional sta / labor to ll gap between underutilized FTEs and sta / labor needed to sustain 20% increase in quantities returned to suppliers Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o Amount of time needed to obtain capital to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities returned to suppliers o Amount of time needed to obtain assets/capacity to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities returned to suppliers ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o Amount of time needed to obtain supplemental outsourced or leased resources or facilities to sustain 20% increase in quantities returned to suppliers Cycle Time o Amount of time needed to reach and sustain current supplier return order cycle time ! Supplier return order processing cycle time (procurement and logistics) ! Pick-to-ship cycle time ! Transit time
2.3.18
AG.2.4
Level 1 Level 2
AG.1.1 Upside Supply Flexibility AG.2.4 Upside Source Return Flexibility

Current source return volume Productivity-orders produced per FTE Internal and External (3PL) Equipment capacity needed for current return volume Internal and External (3PL) storage capacity needed for current return volume Current capital requirements Current supplier return order cycle time Additional source return volume Procurement sta /Logistics labor availability
Constraint Factors
Time needed to recruit/hire/train additional sta /labor Current internal equipment capacity utilization Capital availability Time needed to obtain additional capital Time needed to obtain additional equipment Time needed to obtain additional internal space Supplemental outsource/lease availability Time needed to obtain supplemental outsourced (3PL) or leased resources or facilities Time to reach and sustain current logistics order cycle time
2.3.19
AG.2.5
Upside Deliver Return Flexibility
The number of days required to achieve an unplanned sustainable 20% increase in the return of nished goods from customers. Note: This is a planning activity normally considering constraints to increase delivery that results in an estimate.
Qualitative Relationship Description Least time to pursue all necessary activities. Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Deliver Return: Input Assuming no customer constraints, current elements needed to fully understand future requirements, to establish 20% gap, based on the question How long will it take for the company to sustain a 20% increase in quantities returned from customers? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current return volume ! Number of orders returned Sta / Labor o Customer Service Sta / Logistics Labor needed to meet current returned volume ! Productivity-orders returned per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current return throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) Cycle Time o Current customer return order cycle time ! Customer return order processing cycle time (customer service and logistics) ! Transit time ! Return processing and disposition cycle time
2.3.20
AG.2.5
Discussion cont. Deliver Return: Resource Availability Assessment & Ramp-up/Lead Time Assuming no customer constraints, elements needed to establish 20% delta in resources and what is required to meet the 20% delta based on the question How long will it take for the company to sustain a 20% increase in quantities returned to suppliers? Demand o Additional customer return volume Sta / Labor o Customer Service sta / Logistics labor availability (underutilized FTEs) o Amount of time needed to recruit/hire/train additional sta / labor to ll gap between underutilized FTEs and sta / labor needed to sustain 20% increase in quantities returned from customers Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o Amount of time needed to obtain capital to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities returned from customers o Amount of time needed to obtain assets/capacity to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities returned from customers ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o Amount of time needed to obtain supplemental outsourced or leased resources or facilities to sustain 20% increase in quantities returned from customers Cycle Time o Amount of time needed to reach and sustain current customer return order cycle time ! Customer return order processing cycle time (customer service and logistics) ! Transit time ! Return processing and disposition cycle time
2.3.21
AG.2.5
Level 1 Level 2
AG.1.1 Upside Supply Chain Flexibility AG.2.5 Upside Deliver Return Flexibility
Current deliver return volume Productivity-orders returned per FTE Internal and External (3PL) Equipment capacity needed for current return volume Internal and External (3PL) storage capacity needed for current return volume Current capital requirements Current customer return order cycle time Additional deliver return volume
Level 3
Customer Service sta /Logistics labor availability Time needed to recruit/hire/train additional sta /labor Current internal equipment capacity utilization Current internal storage capacity utilization Capital availability Time needed to obtain additional capital Time needed to obtain additional equipment Time needed to obtain additional internal space Supplemental outsource/lease availability Time needed to obtain supplemental outsourced (3PL) or leased resources or facilities Time to reach and sustain current customer return order cycle time
2.3.22
AG.2.6
Upside Source Adaptability
The maximum sustainable percentage increase in raw material quantities that can be acquired/received in 30 days.
Qualitative Relationship Description Least quantity sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Source: Input Current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of an increase in quantities sourced (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current source volumes ! Amount of each item purchased Stang o Sta needed to meet current demand ! Productivity-purchase orders per FTE ! Needed, but may be underutilized Capital o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures Materials o All else equal in make, deliver, return, current inventory on hand (raw material and purchased nished goods), including safety stock required to sustain current order fulllment. ! Assuming optimized inventory practices (no excess inventory) o Current sourcing/supplier constraints ! Current contract terms. ! Nature of items; commodity/sole source. Cycle Time o Current procurement cycle time ! Time to place a purchase order ! Supplier lead time
2.3.23
AG.2.6
Discussion cont. Source: Resource Availability Assessment & Ramp-up/Lead Time Elements needed to establish delta in resources and what can be ramped up and sustained within 30 days based on the question How much of an increase in quantities sourced (expressed as a percentage) can the company sustain, given 30 days Demand o Additional source volume to be determined given ramped up resources below Stang o Sta availability in procurement (underutilized FTEs) o How much sta can be recruited/hired and trained ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities sourced given 30 days Capital o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures o How much capital can be obtained to increase quantities sourced given 30 days Materials o Sourcing Constraints ! Time required in negotiating new source/volume contracts/terms ! Time required to nd/obtain additional sources o All else equal in make, deliver, return, how much inventory (raw material and purchased nished goods) can be obtained, delivered and phased in and sustained for order fulllment, including safety stock given 30 days. Cycle Time o Procurement order cycle time reestablished and sustained for increased quantities sourced given 30 days. ! Time to place a purchase order ! Supplier lead time
2.3.24
AG.2.6
Level 1 Level 2
AG.1.2 Upside Supply Chain Adaptability AG.2.6 Upside Source Adaptability

Current source volume Productivity-purchase orders per FTE Current capital requirements Current on-hand inventories (Raw, Purchased FG) Current sourcing/supplier constraints Current purchase order cycle times Additional source volumes obtained in 30 days Procurement sta availability Amount additional sta recruited/hired/trained in 30 days
Level 3
Capital availability Additional demand sourcing - supplier constraints Amount of additional capital obtained in 30 days Amount of inventory (Raw, Purchased FG) obtained in 30 days Purchase order cycle time reestablished and sustained in 30 days
2.3.25
AG.2.7
Upside Make Adaptability
The maximum sustainable percentage increase in production that can be achieved in 30 days with the assumption of no raw material constraints.
Qualitative Relationship Description Least quantity sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Make: Input Current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of an increase in quantities produced (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current make volumes ! Amount of each item manufactured Labor o Labor needed to meet current demand ! Productivity-units/orders per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (outsourced) capacity needed for current demand throughput ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) Materials o All else equal in source, deliver and return, current inventory on hand (WIP and nished goods), including safety stock required to sustain current order fulllment. ! Assuming optimized inventory practices (no excess inventory) Cycle Time o Current manufacturing cycle time (all else equal including procurement order cycle time and supplier lead time)
2.3.26
AG.2.7
Discussion cont. Make: Resource Availability Assessment & Ramp-up/Lead Time Elements needed to establish delta in resources and what can be ramped up and sustained within 30 days based on the question How much of an increase in quantities produced (expressed as a percentage) can the company sustain, given 30 days Demand o Additional make volume to be determined given increased resources below Labor o Direct labor availability and percent of labor used in manufacturing, not used in direct activity (underutilized FTEs) o How much labor can be recruited/hired and trained ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities produced given 30 days Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o How much capital can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities produced given 30 days o How much assets/capacity can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities produced given 30 days ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! Facilities, lease building, etc. ! Lease manufacturing equipment, materials handling and packaging equipment, etc. ! Co-packers o How much supplemental outsourced or leased resources or facilities can be obtained to increase and sustain quantities produced given 30 days Materials o All else equal in source, deliver and return, how much raw material inventory can be received and phased into manufacturing and produced into WIP and FG inventory, and sustained for order fulllment, including safety stock given 30days. Cycle Time o Manufacturing cycle time reestablished and sustained for increased quantities produced given 30 days.
2.3.27
AG.2.7
Level 1 Level 2
AG.1.2 Upside Supply Chain Adaptability AG.2.7 Upside Make Adaptability

Current make volume Productivity-units/orders produced per FTE Internal and External manufacturing equipment capacity needed for current make volume Internal and External facilities/, storage capacity needed for current make volume Current capital requirements Current iventory on hand (WIP,FG) Current manufacturing order cycle time Additional make volume
Level 3
Direct labor availability Percent of labor used in manufacturing, not in direct acivity Amount additional labor recruited/hired/trained in 30 days Current internal equipment capacity utilization Capital availability Amount additional capital obtained in 30 days Amount additiona equipment obtained in 30 days Amount additional internal space obtained in 30 days Supplemental outsource/lease availability Amount of supplemental outsourced or leased resources or facilities obtained in 30 days Amount of additional inventory (raw) received and made (WIP, FG) in 30 days
Manufacturing cycle time reestablished and sustained in 30 days The dashed line boxes represent optional metrics associated with specic level 3 processes.
2.3.28
AG.2.8
Upside Deliver Adaptability
The maximum sustainable percentage increase in quantities delivered that can be achieved in 30 days with the assumption of unconstrained nished good availability.
Qualitative Relationship Description Least quantity sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Deliver: Input Current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of an increase in quantities delivered (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current delivery volume ! Number of orders shipped Labor o Labor needed to meet current demand ! Productivity-orders per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current demand throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) Materials o All else equal in source, make, return, current nished goods inventory on hand (including safety stock required to sustain current order fulllment) ! Assuming optimized inventory practices (no excess inventory)
2.3.29
AG.2.8
Discussion cont. Cycle Time o Current logistics order cycle time (all else equal including procurement order cycle time, supplier lead time, manufacturing cycle time, etc.) ! Customer order processing cycle time (logistics only) ! Dock-to-stock cycle time ! Pick-to-ship cycle time ! Transit time Deliver: Resource Availability Assessment & Ramp-up/Lead Time Elements needed to establish delta in resources and what can be ramped up and sustained within 30 days based on the question How much of an increase in quantities delivered (expressed as a percentage) can the company sustain, given 30 days Demand o Additional delivery volume to be determined given increased resources below Labor o Direct labor availability and percent of labor used in logistics, not used in direct activity (underutilized FTEs) o How much labor can be recruited/hired and trained ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities delivered given 30 days Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o How much capital can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities delivered given 30 days o How much assets/capacity can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities delivered given 30 days ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o How much supplemental outsourced or leased resources or facilities can be obtained to increase and sustain quantities delivered given 30 days Materials o All else equal in source, make, return, amount of how much nished goods inventory can be received/stocked, including safety stock to sustain quantities delivered given 30 days
2.3.30
AG.2.8
Discussion cont. Cycle Time o Logistics cycle time reestablished and sustained for increased quantities delivered given 30 days (all else equal including procurement order cycle time, supplier lead time, manufacturing cycle time, etc.) ! Customer order processing cycle time (logistics only) ! Dock-to-stock cycle time ! Pick-to-ship cycle time ! Transit time
2.3.31
AG.2.8
Level 1 Level 2
AG.1.2 Upside Supply Chain Adaptability AG.2.8 Upside Deliver Adaptability

Current delivery volume Productivity-orders shipped per FTE Internal and External (3PL) equipment capacity needed for current delivery volume Internal and External (3PL) storage capacity needed for current delivery volume Current capital requirements Current inventory on hand (FG) Current logistics order cycle time Additional delivery volume
Level 3
Direct labor availability Percent of labor used in logistics, not in direct activity Amount labor recruited/hired/trained in 30 days Current internal equipment capacity utilization Current internal storage capacity utilization Capital availability Amount additional capital obtained in 30 days Amount additiona equipment obtained in 30 days Amount additional internal space obtained in 30 days Supplemental outsource/lease availability Amount of supplemental outsourced or leased resources or facilities obtained in 30 days Amount of additional inventory (FG) obtained in 30 days Logistics order cycle time reestablished and sustained in 30 days
2.3.32
AG.2.9
Upside Source Return Adaptability
The maximum sustainable percentage increase in returns of raw materials to suppliers that can be achieved in 30 days.
Qualitative Relationship Description The component which is the bottleneck determines the least volume for the increase of returns within 30 days. Least quantity sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Source Return: Input Assuming no supplier constraints, current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of an increase in quantities returned to suppliers (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current return volume ! Number of orders returned Sta / Labor o Procurement Sta / Logistics Labor needed to meet current returned volume ! Productivity-orders returned per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current return throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) Cycle Time o Current supplier return order cycle time ! Supplier return order processing cycle time (procurement and logistics) ! Pick-to-ship cycle time ! Transit time
2.3.33
AG.2.9
Discussion cont. Source Return: Resource Availability Assessment & Ramp-up/Lead Time Assuming no supplier constraints, elements needed to establish delta in resources and what can be ramped up and sustained within 30 days based on the question How much of an increase in quantities returned to suppliers (expressed as a percentage) can the company sustain, given 30 days Demand o Additional supplier return volume to be determined given increased resources below Sta / Labor o Procurement sta / Logistics labor availability (underutilized FTEs) o How much procurement sta/logistics labor can be recruited/hired and trained ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities returned to suppliers given 30 days Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o How much capital can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities returned to suppliers given 30 days o How much assets/capacity can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities returned to suppliers given 30 days ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o How much supplemental outsourced or leased resources or facilities can be obtained to increase and sustain quantities returned to suppliers given 30 days Cycle Time o Source return cycle time reestablished and sustained for increased quantities returned to suppliers given 30 days ! Supplier return order processing cycle time (procurement and logistics) ! Pick-to-ship cycle time ! Transit time
2.3.34
AG.2.9
Level 1 Level 2
AG.1.2 Upside Supply Chain Adaptability AG.2.9 Upside Source Return Adaptability
Current source return volume Productivity-orders returned per FTE Internal and External (3PL) equipment capacity needed for current return volume Internal and External (3PL) storage capacity needed for current return volume Current capital requirements Current supplier return order cycle time Additional source return volume Procurement sta /Logistics labor availability
Level 3
Amount sta /labor recruited/hired/trained in 30 days Current internal equipment capacity utilization Current internal storage capacity utilization Capital availability Amount of additional capital obtained in 30 days Amount of additional equipment obtained in 30 days Amount additional internal space obtained in 30 days Supplemental outsource/lease availability Amount of supplemental outsourced (3PL) or leased resources or facilities obtained in 30 days Amount of additional inventory (FG) obtained in 30 days Supplier return order cycle time reestablished and sustained in 30 days
2.3.35
AG.2.10
Upside Deliver Return Adaptability
The maximum sustainable percentage increase in returns of nished goods from customers that can be achieved in 30 days.
Qualitative Relationship Description The component which is the bottleneck determines the least volume for the increase of returns within 30 days. Least quantity sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Deliver Return: Input Assuming no customer constraints, current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of an increase in quantities returned from customers (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current return volume ! Number of orders returned Sta / Labor o Customer Service Sta / Logistics Labor needed to meet current returned volume ! Productivity-orders returned per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current return throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) Cycle Time o Current customer return order cycle time ! Customer return order processing cycle time (customer service and logistics) ! Transit time ! Return processing and disposition cycle time
2.3.36
AG.2.10
Discussion cont. Deliver Return: Resource Availability Assessment & Ramp-up/Lead Time Assuming no customer constraints, elements needed to establish delta in resources and what can be ramped up and sustained within 30 days based on the question How much of an increase in quantities returned from customers (expressed as a percentage) can the company sustain, given 30 days Demand: o Additional customer return volume to be determined given increased resouces below Sta / Labor o Customer Service sta / Logistics labor availability (underutilized FTEs) o How much customer service sta/logistics labor can be recruited/hired and trained ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities returned from customers given 30 days Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital availability ! Credit line ! Cash on hand ! Accounting procedures ! Finance Procedures (outsource vs. in-source, lease vs. purchase) o How much capital can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities returned from customers given 30 days o How much assets/capacity can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities returned from customers given 30 days ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o How much supplemental outsourced or leased resources or facilities can be obtained to increase and sustain quantities returned from customers given 30 days Cycle Time o Deliver return cycle time reestablished and sustained for increased quantities returned to suppliers given 30 days o Customer return order processing cycle time (customer service and logistics) ! Transit time ! Return processing and disposition cycle time
2.3.37
AG.2.10
Level 1 Level 2
AG.1.2 Upside Supply Chain Adaptability AG.2.10 Upside Deliver Return Adaptability
Current deliver return volume Productivity-orders returned per FTE Internal and External (3PL) equipment capacity needed for current return volume Internal and External (3PL) storage capacity needed for current return volume Current capital requirements Current customer return order cycle time Additional deliver return volume Customer service sta /Logistics labor availability
Level 3
Amount sta /labor recruited/hired/trained in 30 days Current internal equipment capacity utilization Current internal storage capacity utilization Capital availability Amount of additional capital obtained in 30 days Amount of additional equipment obtained in 30 days Amount additional internal space obtained in 30 days Supplemental outsource/lease availability Amount of supplemental outsourced (3PL) or leased resources or facilities obtained in 30 days Amount of additional inventory (FG) obtained in 30 days Customer return order cycle time reestablished and sustained in 30 days
2.3.38
AG.2.11
Downside Source Adaptability
The raw material quantity reduction sustainable at 30 days prior to delivery with no inventory or cost penalties.
Qualitative Relationship Description Least quantity reduction sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Source: Input Current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of a reduction in quantities sourced (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current source volumes ! Amount of each item purchased Stang o Sta needed to meet current demand ! Productivity-purchase orders per FTE ! Needed, but may be underutilized Capital o Current capital requirements ! Accounting procedures Materials o All else equal in make, deliver, return, current inventory on hand (raw material and purchased nished goods), including safety stock required to sustain current order fulllment. ! Assuming optimized inventory practices (no excess inventory) o Current sourcing/supplier constraints ! Current contract terms. ! Nature of items; commodity/sole source. Cycle Time o Current procurement cycle time ! Time to place a purchase order ! Supplier lead time
2.3.39
AG.2.11
Discussion cont. Source: Resource Availability Assessment & Ramp-down/Lead Time Elements needed to establish delta in resources and what can be ramped down and sustained at 30 days prior to delivery based on the question How much of a decrease in quantities sourced (expressed as a percentage) can the company sustain without inventory or cost penalties, given 30 days notice prior to delivery Demand o Reduced source volume to be determined given ramped down resources below Stang o Sta availability in procurement (underutilized FTEs) o How much sta can be laid-o or diverted to other activities, without cost penalty, to ramp down to decreased quantities delivered given 30 days notice Capital o Current capital requirements ! Accounting procedures for selling/diverting/recycling assets Materials o Sourcing Constraints ! Time required in negotiating new source/volume contracts/terms ! Time required to ramp down supplier inventory o How much inventory (raw material and purchased nished goods) can be returned, sold or diverted without cost penalty to ramp down to decreased quantities delivered given 30 days notice Cycle Time o Procurement order cycle time reestablished and sustained for decreased quantities sourced given 30 days. ! Time to place a purchase order ! Supplier lead time
2.3.40
AG.2.11
Level 1 Level 2
AG.1.3 Downside Supply Adaptability AG.2.11 Downside Source Adaptability

Current source volumes Productivity-purchase orders per FTE Current capital requirements Current on-hand inventories (Raw, Purchased FG) Current sourcing/supplier constraints Current purchase order cycle times Reduced source volumes accomplished in 30 days Procurement sta availability Amount of sta that can be laid-o in 30 days
Level 3
Capital availability Current capital requirements (accounting policy) Demand sourcing - supplier constraints Amount of decrease in inventory (Raw, Purchased FG) obtained in 30 days Purchase order cycle time reestablished and sustained in 30 days
2.3.41
AG.2.12
Downside Make Adaptability
The production reduction sustainable at 30 days prior to delivery with no inventory or cost penalties.
Qualitative Relationship Description Least quantity reduction sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Make: Input Current elements needed to fully understand future requirements, to establish the volume delta that can be sustained based on the question How much of a reduction in quantities produced (expressed as a percentage) can the company sustain, given 30 days? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current make volumes ! Amount of each item manufactured Labor o Labor needed to meet current demand ! Productivity-units/orders per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (outsourced) capacity needed for current demand throughput ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Accounting procedures ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) Materials o All else equal in source, deliver and return, current inventory on hand (WIP and nished goods), including safety stock required to sustain current order fulllment. ! Assuming optimized inventory practices (no excess inventory) Cycle Time o Current manufacturing cycle time (all else equal including procurement order cycle time and supplier lead time)
2.3.42
AG.2.12
Make: Resource Availability Assessment & Ramp-down/Lead Time Elements needed to establish delta in resources and what can be ramped down and sustained at 30 days prior to delivery based on the question How much of a decrease in quantities produced (expressed as a percentage) can the company sustain without inventory or cost penalties, given 30 days notice prior to delivery Demand o Reduced make volume to be determined given ramped down resources below Labor o Direct labor availability and percent of labor used in manufacturing, not used in direct activity (underutilized FTEs) o How much labor can be laid-o or diverted to other activities, without cost penalty, to ramp down to decreased quantities delivered given 30 days notice Capital/Assets o Current Internal Capacity utilization ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. o Current capital requirements ! Accounting procedures for selling/diverting/recycling assets ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) and their eect upon ability to terminate leases or sell capital equipment assets. o How many capital equipment assets can be recycled, diverted or sold or subleased without cost penalty, to ramp down to decreased quantities delivered given 30 days notice ! Facilities, space ! Manufacturing equipment, materials handling and packaging equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! Facilities, lease building, etc. ! Lease manufacturing equipment, materials handling and packaging equipment, etc. ! Co-packers o How much supplemental outsourced or leased resources or facilities can be terminated to ramp down to decreased quantities delivered given 30 days notice Materials o All else equal in source, deliver and return, how much manufacturing quantities (WIP and FG inventory), including safety stock can be ramped down to decreased order fulllment quantities given 30 days notice. Cycle Time o Manufacturing cycle time reestablished and sustained for decreased quantities produced given 30 days.
2.3.43
AG.2.12
Level 1 Level 2
AG.1.3 Downside Supply Chain Adaptability AG.2.12 Downside Make Adaptability

Current make volumes Productivity-units/orders produced per FTE Internal and External manufacturing equipment capacity needed for current make volume Internal and External facilities/, storage capacity needed for current make volume Current capital requirements Current inventory on hand (WIP, FG) Current manufacturing order cycle time Reduced make volume
Level 3
Direct labor availability Percent of labor used in manufacturing, not used in direct activity Amount of labor that can be laid o in 30 days Current internal equipment capacity utilization Amount of equipment recycled, diverted or sold in 30 days Capital Requirements (Acct./Finance Policy) Amount of internal space subleased or sold in 30 days Supplemental outsource/lease termination ability Amount supplemental outsourced or leased resources or facilities terminated in 30 days Amount reduced in inventory made (WIP, FG) in 30 days Manufacturing cycle time reestablished and sustained in 30 days
2.3.44
AG.2.13
Downside Deliver Adaptability
Downside Deliver Adaptability = The reduction in delivered quantities sustainable at 30 days prior to delivery with no inventory or cost penalties.
Qualitative Relationship Description Least quantity reduction sustainable when considering all components Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion Deliver: Input Elements Current elements needed to fully understand future requirements, to establish what can be ramped down and sustained at 30 days prior to delivery, based on the question How much of a decrease in quantities delivered (expressed as a percentage) can the company sustain without inventory or cost penalties, given 30 days notice prior to delivery? These elements are mainly output metrics from other attributes . . . responsiveness, reliability, cost, asset management. Demand o Current delivery volume ! Number of orders shipped Labor o Labor needed to meet current demand ! Productivity-orders per FTE ! Needed, but may be underutilized Capital/Assets o Internal and External (3PL) capacity needed for current demand throughput ! Facilities, space ! Fleet equipment, outside carrier loads, materials handling equipment, etc. ! Needed, but may be underutilized o Current capital requirements ! Accounting procedures ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) Materials o All else equal in source, make, return, current nished goods inventory on hand (including safety stock required to sustain current order fulllment) o Assuming optimized inventory practices (no excess inventory)
2.3.45
AG.2.13
Discussion cont. Cycle Time o Current logistics order cycle time (all else equal including procurement order cycle time, supplier lead time, manufacturing cycle time, etc.) ! Customer order processing cycle time (logistics only) ! Dock-to-stock cycle time ! Pick-to-ship cycle time ! Transit time Deliver: Availability Assessment & Ramp-down/Lead Time Elements needed to establish delta in resources and what can be ramped down and sustained at 30 days prior to delivery based on the question How much of a decrease in quantities delivered (expressed as a percentage) can the company sustain without inventory or cost penalties, given 30 days notice prior to delivery Demand: o Reduced delivery volume to be determined given ramped down resources below Labor o Direct labor availability and percent of labor used in logistics, not used in direct activity (underutilized FTEs) o How much labor can be laid-o or diverted to other activities, without cost penalty, to ramp down to decreased quantities delivered given 30 days notice Capital/Assets o Current Internal Capacity utilization o Facilities, space ! Fleet equipment, materials handling equipment, etc. o Current capital requirements ! Accounting procedures for selling/diverting/recycling assets ! Finance Procedures (outsource vs. in-source, make vs. buy, lease vs. purchase) and their eect upon ability to terminate leases or sell capital equipment assets. o How many capital equipment assets can be recycled, diverted or sold without cost penalty, to ramp down to decreased quantities delivered given 30 days notice ! Facilities, space ! Fleet equipment, materials handling equipment, etc. Outsourcing Alternatives to capital o Supplemental Outsource/lease availability ! 3PL facilities, lease building, etc. ! Full service lease eet, materials handling, etc. equipment ! Outside carriers o How much supplemental outsourced or leased resources or facilities agreements can be terminated to ramp down to decreased quantities delivered given 30 days notice Materials o All else equal in source, make, return, how much inventory can be shipped or diverted without cost penalty to ramp down to decreased quantities delivered given 30 days notice (all else equal in source and make, includes safety stock) ! Transit time
2.3.46
AG.2.13
Discussion cont. Cycle Time o Logistics cycle time reestablished and sustained for decreased quantities delivered given 30 days (all else equal including procurement order cycle time, supplier lead time, manufacturing cycle time, etc.) ! Customer order processing cycle time (logistics only) ! Dock-to-stock cycle time ! Pick-to-ship cycle time
2.3.47
AG.2.13
Level 1 Level 2
AG.1.3 Downside Supply Chain Adaptability AG.2.13 Downside Deliver Adaptability

Current Delivery volumes Productivity-orders shipped per FTE Internal and External (3PL) equipment capacity needed for current delivery volume Internal and External (3PL) storage capacity needed for current delivery volume Current capital requirements Current inventory on hand (FG) Current logistics order cycle time Amount supplemental outsourced or leased resources or facilities terminated in 30 days Amount decrease in inventory (FG) obtained in 30 days Logistics order cycle time reestablished & sustained in 30 days Supplemental outsource/lease termination ability Amount internal space subleased or sold in 30 days Amount of equipment recycled, diverted or sold in 30 days Purchase order cycle time reestablished and sustained in 30 days Capital Requirements (Acct/Finance Policy) Current internal storage capacity utilization Current internal equipment capacity utilization Amount of labor that can be laid o in 30 days Percent of labor used in logistics, not used in direct activiy Direct lavor availability Reduced delivery volume
Level 3
2.3.48
AG
Level 3 Agility Metrics
Metric ID
AG.3.1
Metric Name
% of labor used in logistics, not used in direct activity % of labor used in manufacturing, not used in direct activity Additional deliver return volume
Metric Denition
Percent of labor used in logistics, not used in direct activity
Process
D1: Deliver Stocked Product D2: Deliver Make-to-Order Product D3: Deliver Engineer-to-Order Product M1: Make-to-Stock M2: Make-to-Order M3: Engineer-to-Order DR1: Deliver Return Defective Product DR2: Deliver Return MRO Product DR3: Deliver Return Excess Product D1: Deliver Stocked Product D2: Deliver Make-to-Order Product D3: Deliver Engineer-to-Order Product ES.7: Manage Supplier Network ES.10: Manage Supplier Agreements EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration ES.5: Manage Source Capital Assets ES.6: Manage Incoming Product ES.7: Manage Supplier Network ES.10: Manae Supplier Agreements S1: Source Stocked Product S2: Source Make-to-Order Product S3: Source Engineer-to-Order Product EP.10: Align Supply Chain Unit Plan with Financial Plan
AG.3.2
Percent of labor used in manufacturing, not used in direct activity
AG.3.3
Additional customer return volume
AG.3.4
Additional Delivery volume
Additional delivery volume
AG.3.5
Additional demand sourcing-supplier constraints Additional make volume
Time required in negotiating new source/volume contracts/terms and time required to nd/obtain additional source Additional make volume to be determined given increased resources
AG.3.6
AG.3.7
Additional source return volume
Additional supplier return volume
AG.3.8
Additional Source Volumes
Additional source volume
AG.3.9
Additional source volumes obtained in 30 days Amount additional capital obtained in 30 days
Additional source volume to be determined given ramped up resources
AG.3.10
How much capital can be obtained to ll gap between underutilized asset capacity and assets needed to increase and sustain quantities delivered given 30 days
2.3.49
AG
Metric ID
AG.3.11
Metric Name
Amount additional equipment obtained in 30 days
Metric Denition
How much assets/capacity can be obtained to ll gap between underutilized asset capacity and assets needed to increased and sustain quantities produced given 30 days in equipment such as manufacturing equipment, materials handling and packaging equipment, etc How much assets/capacity can be obtained to ll gap between underutilized asset capacity and assets needed to increased and sustain quantities produced given 30 days in internal space
Process
EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets ES.4: Manage Product Inventory, EM.4: Manage In-Process Products, ED.4: Manage Finished Goods Inventories
AG.3.12
Amount additional internal space obtained in 30 days
AG.3.13
Amount additional inventory (raw) received and made (WIP, FG) in 30 days Amount additional labor recruited/hired/ trained in 30 days Amount additional sta recruited/hired/ trained in 30 days Amount additional sta/ labor recruited/ hired/trained in 30 days Amount decrease in inventory (FG) obtained in 30 days Amount decrease in inventory (Raw, Purchased FG) obtained in 30 days
How much raw material inventory can be received and phased into manufacturing and produced into WIP and FG inventory, and sustained for order fulllment, including safety stock given 30 days How much labor can be recruited/ hired and trained to ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities produced given 30 days How much labor can be recruited/ hired and trained to ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities produced given 30 days How much sta/labor can be recruited/ hired and trained ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities sourced given 30 days How much inventory can be shipped or diverted without cost penalty to ramp down to decreased quantities delivered given 30 days notice (all else equal in source and make, includes safety stock) How much inventory (raw material and purchased nished goods) can be returned, sold or diverted without cost penalty to ramp down to decreased quantities delivered given 30 days notice
AG.3.14
AG.3.15
AG.3.16
AG.3.17
ED.4: Manage Finished Goods Inventories
AG.3.18
ES.4: Manage Product Inventory, ED.4: Manage Finished Goods Inventories
2.3.50
AG
Metric ID
AG.3.19
Metric Name
Amount labor recruited/hired/ trained in 30 days
Metric Denition
How much labor can be recruited/ hired and trained to ll gap between underutilized FTEs and FTEs needed to increase and sustain quantities delivered given 30 days How much labor can be laid-o or diverted to other activities, without cost penalty, to ramp down to decreased quantities delivered given 30 days notice How many capital equipment assets can be recycled, diverted or sold or subleased without cost penalty, to ramp down to decreased quantities delivered given 30 days notice
Process
AG.3.20
Amount labor that can be laid o in 30 days
AG.3.21
Amount of Equipment recycled, diverted, or sold in 30 days
EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets ED.4: Manage Finished Goods Inventories
AG.3.22
Amount of inventory (Raw, Purchased FG) obtained in 30 days Amount of sta that can be laido in 30 days
How much inventory (raw material and purchased nished goods) can be obtained, delivered and phased in and sustained for order fulllment, including safety stock given 30 days How much sta can be laid-o or diverted to other activities, without cost penalty, to ramp down to decreased quantities delivered given 30 days notice How much manufacturing quantities (WIP and FG inventory), including safety stock can be ramped down to decreased order fulllment quantities given 30 days notice How much supplemental outsourced or leased resources or facilities can be terminated to ramp down to decreased quantities delivered given 30 days notice
AG.3.23
AG.3.24
Amount reduced inventory made (WIP, FG) in 30 days Amount supplemental outsourced or leased resources or facilities terminated in 30
EM.4: Manage In-Process Products, ED.4: Manage Finished Goods Inventories
AG.3.25
EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets
2.3.51
AG
Metric ID
AG.3.26
Metric Name
Amount supplemental outsourced or leased resources or faciltiies obtained in 30 days Capital Availability Capital Requirements (Acct/Finance Policy) Current Capital Requirements Current capital requirements (accounting policy) Current Deliver Return Volume
Metric Denition
How much supplemental outsourced or leased resources or facilities can be obtained to increased and sustain quantities returned to suppliers given 30 day.
Process
EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets EP.10: Align Supply Chain Unit Plan with Financial Plan EP.10: Align Supply Chain Unit Plan with Financial Plan
AG.3.27
The percentage of orders that are fullled on the customers original commit date The average time associated with Deliver Retail Processes
AG.3.28
AG.3.29
Requirements on credit line, cash on hand and accounting procedures based on current sourcing situation Accounting procedures for selling/ diverting/recycling assets
EP.10: Align Supply Chain Unit Plan with Financial Plan EP.10: Align Supply Chain Unit Plan with Financial Plan
AG.3.30
AG.3.31
current return volume, number of orders returned
DR1: Deliver Return Defective Product DR2: Deliver Return MRO Product DR3: Deliver Return Excess Product D1: Deliver Stocked Product D2: Deliver Make-to-Order Product D3: Deliver Engineer-to-Order Product D4: Deliver Retail Product EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets
AG.3.32
Current Delivery Volume
Number of orders shipped
AG.3.33
Current internal equipment capacity utilization
Current utilization of internal equipment capacity, including manufacturing equipment, materials handling and packaging equipment, etc.
AG.3.34
Current Internal facility/storage capacity utilization
Current utilization of internal facility/ storage capacity, including facilities, space.
2.3.52
AG
Metric ID
AG.3.35
Metric Name
Current Internal Storage capacity utilization
Metric Denition
Current utilization of internal facility/ storage capacity, including facilities, space.
Process
EP.5: Manage Integrated Supply Chain Capital Assets, ES.5: Manage Capital Assets, EM.5: Manage Make Equipment and Facilities, ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets ED.4: Manage Finished Goods Inventories
AG.3.36
Current Inventory on hand (FG)
Current on hand inventories (nished goods), including safety stock required to sustain current order fulllment, assuming optimized inventory practices Current on hand inventories (work in process and purchased nished goods), including safety stock required to sustain current order fulllment, assuming optimized inventory practices Amount of each item which are manufactured Current on hand inventories (raw material and purchased nished goods), including safety stock required to sustain current order fulllment, assuming optimized inventory practices Sum of time to place a purchase order and supplier lead time
AG.3.37
Current Inventory on Hand (WIP, FG)
EM.4: Manage In-Process Products, ED.4: Manage Finished Goods Inventories
AG.3.38
Current Make Volume Current On-hand inventories (Raw, Purchased, FG)
M1: Make-to-Stock M2: Make-to-Order M3: Engineer-to-Order ES.4: Manage Product Inventory, EM.4: Manage In-Process Products, ED.4: Manage Finished Goods Inventories S1: Source Stocked Product S2: Source Make-to-Order Product S3: Source Engineer-to-Order Product SR1: Source Return Defective Product SR3: Source Return Excess Product S1: Source Stocked Product S2: Source Make-to-Order Product S3: Source Engineer-to-Order Product ES.10: Manage Supplier Agreements DR1: Deliver Return Defective Product DR2: Deliver Return MRO Product DR3: Deliver Return Excess Product
AG.3.39
AG.3.40
Current Purchase Order Cycle Times
AG.3.41
Current source return volume Current Source Volume
current return volume, number of orders returned Amount of each item which are purchased
AG.3.42
AG.3.43
Current Sourcing/ Supplier Constraints Customer return order cycle time reestablished and sustained in 30 days
Current contract terms and nature of items (commodity/sole source) Customer return order cycle time reestablished and sustained for increased quantities returned from customer given 30 days, including customer return order processing cycle time, transit time, return processing and disposition cycle time, etc.
AG.3.44
2.3.53
AG
Metric ID
AG.3.45
Metric Name
Customer Service sta/Logistics labor availability Demand sourcing-supplier constraints
Metric Denition
Customer service sta / Logistics labor availability Percentage of orders with on time and accurate documentation supporting the order, including packing slips, bills of lading, invoices, etc. [Total number of orders delivered with correct and timely documentation] / [Total number of orders delivered] x 100% Labor needed to meet current demand, productivity-units/orders per FTE Internal and external (3PL) capacity needed for current demand throughput in eet equipment, outside carrier loads, materials handling equipment, etc. Internal and external (3PL) capacity needed for current return throughput in eet equipment, outside carrier loads, materials handling equipment, etc. Internal and External (3PL) Equipment needed for current return volume
Process
AG.3.46
S1: Source Stocked Product S2: Source Make-to-Order Product S3: Source Engineer-to-Order Product
AG.3.47 AG.3.48
Direct Labor Availability Internal and External (3PL) equipment capacity needed for current delivery volume Internal and External (3PL) Equipment capacity needed for current return volume Internal and External (3PL) Equipment needed for current return volume Internal and External (3PL) storage capacity needed for current delivery volume Internal and External (3PL) storage capacity needed for current return volume
EM.2: Manage Production Performance ED.5: Manage Deliver Capital Assets, ED.6: Manage Transportation
AG.3.49
ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration ED.5: Manage Deliver Capital Assets, ED.6: Manage Transportation
AG.3.50
AG.3.51
Internal and external (3PL) capacity needed for current demand throughput in facilities and space.
AG.3.52
Internal and external (3PL) capacity needed for current return throughput in facilities and space.
ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration
2.3.54
AG
Metric ID
AG.3.53
Metric Name
Internal and External facilities/ storage capacity needed for current make volume Internal and External manufacturing equipment capacity needed for current make volume Internal Event Response (average days)
Metric Denition
Internal and external (outsourced) capacity needed for current demand throughput in facilities and space
Process
EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network
AG.3.54
Internal and external (outsourced) capacity needed for current demand throughput in manufacturing equipment
EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network
AG.3.55
The average response time (in days) to an internal risk event from the time of the event (included detection lags)
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk ED.5: Manage Deliver Capital Assets, ED.6: Manage Transportation
AG.3.56
Logistics order cycle time reestablished and sustained in 30 days Manufacturing cycle time reestablished and sustained in 30 days Options Rating (0-100%)
Logistics order cycle time reestablished and sustained for increased quantities produced given 30 days, including customer order processing cycle time, dock-to-stock cycle time, pick-to-ship cycle, transit time, etc Manufacturing cycle time reestablished and sustained for increased quantities produced given 30 days
AG.3.57
EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network EP.9: Manage Supply Chain Plan Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk ES.7: Manage Supplier Network ES.7: Manage Supplier Network
AG.3.58
Options Rating (0-100%)
AG.3.59 AG.3.60
Procurement Sta Availability Procurement sta/Logistics labor availability
Sta availability in procurement Procurement sta / Logistics labor availability
2.3.55
AG
Metric ID
AG.3.61
Metric Name
Productivity orders shipped per FTE Productivityorders returned per FTE ProductivityPurchase orders per FTE Productivityunits/orders produced per FTE Purchase order cycle time reestablished and sustained in 30 days Reduced delivery volume Reduced Make volume
Metric Denition
Productivity-order shipped per FTE to meet current requirements Productivity orders returned per FTE
Process
AG.3.62
ER.2: Manage Performance of Return Processes ES.2: Assess Supplier Performance
AG.3.63
Productivity-purchase order per FTE to meet current requirements Productivity-purchase order per FTE to meet current requirements Procurement order cycle time reestablishment and sustained for increased quantities sourced given 30 days, including time to place a purchase order and supplier lead time Reduced delivery volume to be determined given ramped down resources Reduced make volume to be determined given ramped down resources Reduced source volume to be determined given ramped down resources
AG.3.64
EM.2: Manage Production Performance ES.7: Manage Supplier Network ES.10: Manage Supplier Agreements
AG.3.65
AG.3.66
ED.5: Manage Deliver Capital Assets EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network ES.5: Manage Source Capital Assets ES.6: Manage Incoming Product ES.7: Manage Supplier Network ES.10: Manage Supplier Agreements EM.7: Manage Production Network
AG.3.67
AG.3.68
Reduced source volumes accomplished in 30 days Supplemental outsource/lease availability Supplemental outsource/lease termination ability Time needed to increase inventory (FG) for additional order fulllment
AG.3.69
Including facilities, leasing building, leasing manufacturing equipment, materials handling and packaging equipment, co packers, etc. Including facilities, leasing building, leasing manufacturing equipment, materials handling and packaging equipment, co packers, etc. Amount of time needed to increase nished inventory for order fulllment (time to receive/stock inventory) including safety stock to sustain 20% increase in quantities sourced
AG.3.70
EM.7: Manage Production Network
AG.3.71
2.3.56
AG
Metric ID
AG.3.72
Metric Name
Time needed to increase inventory (WIP, FG) for additional order fulllment
Metric Denition
Amount of time needed to receive and phase in raw material inventory for manufacturing and make WIP and FG (work in process and purchased nished goods) inventory, including safety stock to sustain 20% increase in quantities sourced Amount of time needed to obtain, deliver and phase in inventory (raw material and purchased nished goods) for order fulllment, including safety stock to sustain 20% increase in quantities sourced Amount of time needed to obtain capital to ll gap between current capital availability and capital needed to sustain 20% increase in quantities ordered Amount of time needed to obtain assets/capacity to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities delivered in equipments
Process
AG.3.73
Time needed to increase inventory for additional order fulllment (Raw, Purchase Time needed to obtain additional capital
AG.3.74
AG.3.75
Time needed to obtain additional equipment
EP.5: Manage Integrated Supply Chain Capital Assets ES.5: Manage Capital Assets EM.5: Manage Make Equipment and Facilities ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets EP.5: Manage Integrated Supply Chain Capital Assets ES.5: Manage Capital Assets EM.5: Manage Make Equipment and Facilities ED.5: Manage Deliver Capital Assets ER.5: Manage Return Capital Assets ES.5: Manage Source Capital Assets ES.6: Manage Incoming Product ES.7: Manage Supplier Network, EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network ED.5: Manage Deliver Capital Assets ED.6: Manage Transportation ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration
AG.3.76
Time needed to obtain additional internal space
Amount of time needed to obtain assets/capacity to ll gap between underutilized asset capacity and assets needed to sustain 20% increase in quantities delivered in internal space
AG.3.77
Time needed to obtain supplemental outsourced (3PL) or leased resources or facilities
Amount of time needed to obtain supplemental outsourced or leased resources or facilities to sustain 20% increase in quantities delivered
2.3.57
AG
Metric ID
AG.3.78
Metric Name
Time needed to obtain supplemental outsourced or leased resources or facilities
Metric Denition
Amount of time needed to obtain supplemental outsourced or leased resources or facilities to sustain 20% increase in quantities made
Process
ES.5: Manage Source Capital Assets ES.6: Manage Incoming Product ES.7: Manage Supplier Network, EM.5: Manage Make Equipment and Facilities EM.6: Manage Make Transportation EM.7: Manage Make Network ED.5: Manage Deliver Capital Assets ED.6: Manage Transportation ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration
AG.3.79
Time needed to recruit/hire/train additional labor
Amount of time needed to recruit/ hire/train additional labor to ll gap between underutilized FTEs and labor needed to sustain 20% increase in quantities manufactured Amount of time needed to recruit/hire/ train additional sta to ll gap between underutilized FTEs and sta needed to sustain 20% increase in quantities delivered Amount of time needed to recruit/ hire/train additional labor to ll gap between underutilized FTEs and labor needed to sustain 20% increase in quantities returned to suppliers
AG.3.80
Time needed to recruit/hire/train additional sta
AG.3.81
Time needed to recruit/hire/train additional sta/ labor
2.3.58
CO.1.1
Total Supply Chain Management Cost
The sum of the costs associated with the SCOR Level 2 processes to Plan, Source, Deliver, and Return. Note - Cost of Raw Material and Make Costs are generally accounted for in COGS. It is recognized that there is likely to be overlap/ redundancy between supply chain management costs and COGS.
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) TSCMC = Cost to Plan + Source + Make + Deliver + Return + Mitigate Supply Chain Risk Calculation TSCMC = Sales Prots Cost to Serve (e.g., marketing, selling, administrative) Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of the horizontal processes based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors. Hierarchical Metric Structure
Level 1
CO.1.1 Total Supply Chain Management Cost CO.2.1 Cost to Plan CO.2.2 Cost to Source
Level 2
CO.2.3 Cost to Make CO.2.4 Cost to Deliver CO.2.5 Cost to Return CO.2.7 Mitigation Cost (Cost To Mitigate Supply Chain)
2.4.1
CO.1.2
Cost of Goods Sold
The cost associated with buying raw materials and producing nished goods. This cost includes direct costs (labor, materials) and indirect costs (overhead). Note - Cost of Raw Material and Make Costs are generally accounted for in COGS. It is recognized that there is likely to be overlap/ redundancy between supply chain management costs and COGS.
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Cost of Goods Sold (COGS) = Cost to Make Calculation COGS = direct material costs + direct labor costs + indirect costs related to making product Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of the horizontal processes based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors. Hierarchical Metric Structure
Level 1 Level 2
CO.1.2 Cost of Goods Sold (COGS) CO.2.3 Cost to Make
2.4.2
CO.2.1
Cost to Plan
The sum of the costs associated with Plan. (Processes: P1, P2, P3, P4, P5)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Cost to Plan = Sum of Cost to Plan (Plan + Source + Make + Deliver + Return) Calculation None Identied Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of the horizontal processes based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors. Hierarchical Metric Structure
Level 1 Level 2
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.1 Cost to Plan Cost to Plan Source Cost to Plan Deliver
Level 3
Cost to Plan Supply Chain Cost to Plan Return Cost to Plan Make
2.4.3
CO.2.2
Cost to Source
The sum of the costs associated with Source. (Processes: S1, S2, S3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Cost to Source = Sum of Cost for (Supplier Management + Material Acquisition Management) Calculation Supplier Management = material planning + planning procurement sta + supplier negotiation and qualication + etc. Material Acquisition Management = bidding and quotations + ordering + receiving + incoming material inspection + material storage + payment authorization + sourcing business rules and rqmts. + inbound freight and duties + etc. Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of the horizontal processes based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors. Hierarchical Metric Structure
Level 1 Level 2
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.2 Cost to Source Supplier Management (see processes under Source)
Level 3
Material Acquisition Management (see Processes under Source)
2.4.4
CO.2.3
Cost to Make
The sum of the costs associated with Make. Note - Cost of Raw Material and Make Costs are generally accounted for in COGS. It is recognized that there is likely to be overlap/ redundancy between supply chain management costs and COGS. (Processes: M1, M2, M3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) None Identied Calculation None Identied Data Collection None Identied Discussion None Identied Hierarchical Metric Structure
Level 1 Level 2 Level 3
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.3 Cost to Make
See Cost of Goods Sold
2.4.5
CO.2.3
Cost to Make
The sum of the costs associated with Make. (Processes: M1, M2, M3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Cost to Make = Sum of Direct Material, Direct Labor, and Direct non-Material Product-related Cost (equipment) and of Indirect Product-related Cost Calculation None Identied Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). In some cases, (1) direct material data is maintained at the unit level in bills of material (BOMs) or recipe formulas; and (2) direct labor and direct non-material product (equipment) data is maintained at the unit level in labor/machine routings or process sheets. Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of (1) the horizontal processes (referenced in Lean environments as value-stream mapping), and (2) products (or intermediate outputs) with both types of calculations based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors. Hierarchical Metric Structure
Level 1 Level 2
CO.1.2 Cost of Goods Sold (COGS) CO.2.3 Cost to Make Direct Material Cost
Level 3
Indirect Cost Related to Production Direct Labor Cost
2.4.6
CO.2.4
Cost to Deliver and/or Install
The sum of the costs associated with Deliver and/or Install. (Processes: D1, D2, D3)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Cost to Deliver = Sum of Cost of ( Sales order management + Customer Management ) Calculation Sales order management = inquiry & quotations + order entry & maintenance + channel management + order fulllment + distribution + transportation + outbound freight and duties + installation + customer invoicing / accounting + new product release / phase-in + etc. Customer Management = nancing + post-sales customer service + handling disputes + eld repairs + enabling technologies + etc. Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of the horizontal processes based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors. Hierarchical Metric Structure
Level 1 Level 2
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.4 Cost to Deliver Sales (order) Management (See processes under Deliver)
Level 3
Customer Management (See processes under Deliver)
2.4.7
CO.2.5
Cost to Return
Cost to Return Defective Product - The sum of the costs associated with returning a defective product to the supplier. (Processes: SR1, DR1) Cost to Return Excess Product - The sum of the costs associated with returning excess product to the supplier. (Processes: SR3, DR3) Cost to Return MRO Product - The sum of the costs associated with returning MRO product to the supplier. (Processes: SR2, DR2)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Cost to Return = Sum of Cost to Return ( to Sources + from Customers ) Calculation Cost to Return to Source (SRx) = Verify Defective Product Costs + Disposition of Defective Product Costs + Identify MRO Condition Costs + Request MRO Return Authorization Costs + Schedule MRO Shipment Costs + Return MRO Product Costs + etc. Cost to Return From Customer (DRx) = Authorization Costs + Schedule Return Costs + Receive Costs + Authorize MRO Return Costs + Schedule MRO Return Costs + Receive MRO Return Costs + Transfer MRO Product Costs + etc. Data Collection Resource expenses (e.g., salaries, supplies, etc.) are initially captured in the organizations general ledger accounting system. Then these expenses are traced and assigned (i.e., distributed) to the organizations horizontal core processes based employee time and non wage-related factors (drivers; e.g., # of units consumed). Data for these expense distribution assignments are collected from (1) employee time collection systems (or % split estimates), and (2) operational systems (e.g., enterprise resource planning [ERP] systems). Discussion Collecting transactional information, primarily resource expenses and operational drivers, is now commonplace. The challenging task is to logically transform these expenses into calculated costs of the horizontal processes based on cause-and-eect relationships without the temptation of using broad averages or arbitrary factors.
2.4.8
CO.2.5
Level 1 Level 2
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.5 Cost to Return Cost to Source Return Cost to Deliver Return
Level 3
2.4.9
CO.2.6
Supply Chain Value at Risk (VAR)
Value at Risk the sum of the probability of risk events times the monetary impact of the events for all the supply chain functions (e.g. Plan, Source, Make, Deliver and Return). (Processes: EP.9, ES.9, EM.9, ED.9, ER.9).
Qualitative Relationship Description Value at Risk the sum of the probability of risk events times the monetary impact of the events for all the supply chain functions (e.g. Plan, Source, Make, Deliver and Return). Quantitative Relationship (optional, if calculable) Supply Chain Risk VAR ($) = Sum of Supply Chain VAR $ (Plan + Source + Make + Deliver + Return) Calculation Supply Chain Risk VAR ($) = VAR $ (Plan) + VAR $ (Source) + VAR $ (Make) + VAR $ (Deliver) + VAR $ (Return) Data Collection The VaR calculation uses historical data on the specic event (on time delivery, quality, disruptions, failures, etc) to calculate the number of times the event performed below the target (probability) times the amount below the target. For disruptions, VaR would use estimated frequency based upon expert resources times the impact of the event. Discussion VaR can be used in the supply chain to evaluate the dierent aspects of risk. Suppliers can be evaluated base upon the VaR of performance measures. Customers can also be measured based upon performance measures (protability, volume growth, returns, and complaints) as well as products (warranty claims, etc.). VaR can also be applied to internal supply chain entities such as manufacturing, distribution or sales locations. Since VaR can be monitarized by accessing the cost of performance below target, VaR can be rolled up and examined by any demographic or data cut (by region, by customer, by supplier, etc.). Suppliers can be evaluated based upon VaR and ranked according to the risk of poor performance. Caveats in using VaR : VaR calculates the probability of non-adherence to metrics value (expected value) based on historical data. Hence, it is a retrospective view of the event risk. The same may or may not be applicable in the future. VaR is a downside Risk Metrics. It calculates maximum loss for each level of condence (probability). In a real life scenario, it is likely that the losses would be less than calculated using VaR. Calculating VaR from historical data requires a large database of events and metrics, and it could be computationally intensive.
2.4.10
CO.2.6
Level 1 Level 2
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.6 Value At Risk (VAR $, % of Sales) Value at Risk (VAR $) (Plan) Value at Risk (VAR $) (Make)
Level 3
Value at Risk (VAR $) (Return) Value at Risk (VAR $) (Deliver) Value at Risk (VAR $) (Source)
2.4.11
CO.2.7
Supply Chain Risk Mitigation Cost
The sum of the costs associated with Supply Chain Risk Mitigation Costs. (Processes: EP.9, ES.9, EM.9, ED.9, ER.9)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) Mitigation Costs (Cost to Mitigate Supply Chain Risk) = Sum of Supply Chain Risk Mitigation Costs (Plan + Source + Make + Deliver + Return) Calculation None Identied Data Collection Mitigation Cost - The total supply chain risk mitigation cost of all mitigation actions for a specic area, supplier, product, etc. ($) Discussion None Identied Hierarchical Metric Structure
Level 1 Level 2
CO.1.1 Total Supply Chain Management Cost (TSCMC) CO.2.7 Mitigation Cost (Cost to Mitigate Supply Chain Risk) Risk Mitigation Costs (Plan) Risk Mitigation Costs (Make)
Level 3
Risk Mitigation Costs (Return) Risk Mitigation Costs (Deliver) Risk Mitigation Costs (Source)
2.4.12
CO
Level 3 Cost Metrics
Metric ID
CO.3.1
Metric Name
% Defective Product Scheduling Cost to Total Source Return Cost % Excess Product Scheduling Cost to Total Source Return Cost % MRO Scheduling Cost to Total Source Return Cost % of authorization request transmitted error-free/total authorization requests % of excess packaging per unit % of paints used that are non-toxic % of pallets that are reusable % of solid waste consisting of packaging material % of trucks using retread tires
Metric Denition
% Defective Product Scheduling Cost to Total Source Return Cost
Process
SR1.4: Schedule Defective Product Shipment
CO.3.2
% Excess Product Scheduling Cost to Total Source Return Cost
SR3.4: Schedule Excess Product Shipment
CO.3.3
% MRO Scheduling Cost to Total Source Return Cost
SR2.4: Schedule MRO Shipment
CO.3.4
% of authorization request transmitted error-free/total authorization requests
SR3.3: Request Excess Product Return Authorization SR2.3: Request MRO Return Authorization
CO.3.5
Weight of packaging material that is not needed to protect the product during shipping as a per cent of total packaging material used The volume of paint that does not include toxic ingredients as a percent of total paint volume used Number of reusable pallets used as a percent of total pallets used The weight of packaging material waste as a percent of total solid waste generated. Number of trucks using retreaded tires as a percent of trucks in the carrier eet
M1.4: Package M2.4: Package M3.5: Package EM.6: Manage Transportation (WIP)
CO.3.6
CO.3.7 CO.3.8
EM.6: Manage Transportation (WIP) M1.3: Produce and Test M3.4: Produce and Test M2.3: Produce and Test EM.6: Manage Transportation (WIP)
CO.3.9
2.4.13
CO
Metric ID
CO.3.10
Metric Name
% of vehicle fuel derived from alternative fuels
Metric Denition
The portion of transfer vehicle fuels that are non-petroleum based
Process
M1.2: Issue Material S1.4: Transfer Product M3.3: Issue Sourced/In-Process Product EM.6: Manage Transportation (WIP) ED.6: Manage Transportation M2.2: Issue Sourced/In-Process Product ES.4: Manage Product Inventory
CO.3.11
% of warehouse loading machinery using MFBs % packaging material consisting of post-consumer recycled content % packaging material that is biodegradable % packaging material that is recyclable/ reusable Air emissions
The percent of warehouse machines using maintenance free batteries
CO.3.12
Weight of recycled packaging material as a per cent of total packaging material used
M1.4: Package M2.4: Package M3.5: Package
CO.3.13
Weight of biodegradable packaging material as a per cent of total packaging material used Weight of packaging material that can be eectively recycled as a per cent of total packaging material used The weight of air pollutant emitted per weight of nished good produced The cost of risk assessment and management activities for a specic area, supplier, product, etc.($)
M1.4: Package M2.4: Package M3.5: Package M1.4: Package M2.4: Package M3.5: Package M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk SR1.1: Identify Defective Product Condition
CO.3.14
CO.3.15
CO.3.16
Assessment / Risk Management Costs ($)
CO.3.17
Cost of identifying the defective condition as a % of total Source cost
Cost of identifying the defective condition as a % of total Source cost
2.4.14
CO
Metric ID
CO.3.18
Metric Name
Cost of Identifying the MRO Condition as a % of Total Source Return Cost Cost of identifying the excess condition as a % of total Source cost Cost per request authorization
Metric Denition
Cost of Identifying the MRO Condition as a % of Total Source Return Cost
Process
SR2.1: Identify MRO Product Condition
CO.3.19
Cost of identifying the excess condition as a % of total Source cost
SR3.1: Identify Excess Product Condition
CO.3.20
Cost per request authorization
SR1.5: Return Defective Product SR2.5: Return MRO Product SR3.5: Return Excess Product SR1.3: Request Defective Product Return Authorization SR2.3: Request MRO Return Authorization SR3.3: Request Excess Product Return Authorization EP.10: Align Supply Chain Unit Plan with Financial Plan
CO.3.21
Cost to Align Supply Chain Unit Plan with Financial Plan Cost to Assess Delivery Performance Cost to Assess Supplier Performance Cost to Authorize Defective Product Return Cost to Authorize Excess Product Return Cost to Authorize MRO Product Return Cost to Authorize Supplier Payment
The sum of the costs associated with aligning supply chain performance plans with nancial plans. The sum of the costs associated with assessing delivery performance. The sum of the costs associated with assessing supplier performance. The sum of the costs associated with authorizing the return of defective product. The sum of the costs associated with authorizing the return of excess product. The sum of the costs associated with authorizing the return of product to be maintained, repaired, or overhauled. The sum of the costs associated with authorizing supplier payment.
CO.3.22
CO.3.23
CO.3.24
DR1.1: Authorize Defective Product Return DR3.1: Authorize Excess Product Return DR2.1: Authorize MRO Product Return S1.5: Authorize Supplier Payment S2.5: Authorize Supplier Payment S3.7: Authorize Supplier Payment
CO.3.25
CO.3.26
CO.3.27
2.4.15
CO
Metric ID
CO.3.28
Metric Name
Cost to Balance Production Resources with Production Requirements Cost to Balance Product Resources with Product Requirements Cost to Balance Supply Chain Resources with Supply Chain Requirements Cost to Build Loads Cost to Checkout Cost to Consolidate Orders Cost to Deliver and/or Install Cost to Deliver Return
Metric Denition
The sum of the costs associated with identifying, assessing and aggregating production resources.
Process
P3.3: Balance Production Resources with Production Requirements
CO.3.29
The sum of the costs associated with balance of product resources with product requirements.
P2.3: Balance Product Resources with Product Requirements
CO.3.30
The sum of the costs associated with balance of supply chain resources with supply chain requirements.
P1.3: Balance Supply Chain Resources with SC Requirements
CO.3.31
The sum of the costs associated with building transportation loads. The sum of the costs associated with product checkout. The sum of the costs associated with consolidating customer orders. The sum of the costs associated with deliver and/or install Cost to Return From Customer (DRx) = Authorization Costs + Schedule Return Costs + Receive Costs + Authorize MRO Return Costs + Schedule MRO Return Costs + Receive MRO Return Costs + Transfer MRO Product Costs + etc. The sum of the costs associated with entering the order, committing resources & launching a program. The sum of the costs associated with establishing and communicating return plans. The sum of the costs associated with establishing and communicating supply chain plans.
D1.5: Build Loads D2.5: Build Loads D3.5: Build Loads D4.6: Checkout D1.4: Consolidate Orders D2.4: Consolidate Orders D4.7: Deliver and/or Install DR1: Deliver Return Defective Product DR2: Deliver Return MRO Product
CO.3.32 CO.3.33
CO.3.34 CO.3.35
CO.3.36
Cost to Enter Order, Commit Resources & Launch Program Cost to Establish and Communicate Return Plans Cost to Establish and Communicate Supply Chain Plans
D3.3: Enter Order, Commit Resources Launch Program
CO.3.37
CO.3.38
2.4.16
CO
Metric ID
CO.3.39
Metric Name
Cost to Establish Delivery Plans Cost to Establish Production Plans Cost to Establish Sourcing Plans Cost to Fill Shopping Cart Cost to Finalize Production Engineering Cost to Generate Stocking Schedule Cost to Identify Sources of Supply Cost to Identify, Assess, and Aggregate Delivery Resources Cost to Identify, Assess, and Aggregate Product Resources Cost to Identify, Assess, and Aggregate Production Resources Cost to Identify, Assess, and Aggregate Return Resources Cost to Identify, Assess, and Aggregate Supply Chain Resources
Metric Denition
The sum of the costs associated with establishing and communicating deliver plans. The sum of the costs associated with establishing and communicating production plans. The sum of the costs associated with establishing and communicating source plans. The sum of the costs associated with lling a shopping cart. The sum of the costs associated with nalizing production engineering. The sum of the costs associated with generating a stocking schedule. The sum of the costs associated with identifying sources of supply. The sum of the costs associated with identifying, assessing and aggregating delivery resources.
Process
CO.3.40
P3.4: Establish Production Plans
CO.3.41
P2.4: Establish Sourcing Plans
CO.3.42 CO.3.43
D4.5: Fill Shopping Cart M3.1: Finalize Production Engineering D4.1: Generate Stocking Schedule
CO.3.44
CO.3.45 CO.3.46
S3.1: Identify Sources of Supply P4.2: Identify, Assess and Aggregate Delivery Resources P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements P2.2: Identify, Assess and Aggregate Product Resources
CO.3.47
The sum of the costs associated with identifying, assessing and aggregating product resources.
CO.3.48
The sum of the costs associated with identifying, assessing and aggregating production resources.
P3.2: Identify, Assess and Aggregate Production Resources
CO.3.49
The sum of the costs associated with identifying, assessing and aggregating return resources. The sum of the costs associated with identifying, assessing and aggregating supply chain resources.
P5.2: Identify, Assess, and Aggregate Return Resources P5.3: Balance Return Resources with Return Requirements P1.2: Identify, Prioritize and Aggregate SC Resources
CO.3.50
2.4.17
CO
Metric ID
CO.3.51
Metric Name
Cost to Identify, Prioritize, and Aggregate Delivery Requirements Cost to Identify, Prioritize, and Aggregate Product Requirements Cost to Identify, Prioritize, and Aggregate Production Requirements Cost to Identify, Prioritize, and Aggregate Return Requirements Cost to Identify, Prioritize, and Aggregate Supply Chain Requirements Cost to Install Product Cost to Invoice Cost to Issue Material Cost to Issue Sourced/InProcess Product Cost to Load Product & Generate Shipping Documentation Cost to Maintain Source Data
Metric Denition
The sum of the costs associated with identifying, assessing and aggregating deliver requirements
Process
CO.3.52
The sum of the costs associated with identifying, assessing and aggregating deliver requirements.
CO.3.53
The sum of the costs associated with identifying, assessing and aggregating production requirements
CO.3.54
The sum of the costs associated with identifying, assessing and aggregating return requirements. The sum of the costs associated with identifying, assessing and aggregating supply chain requirements.
P5.1: Assess and Aggregate Return Requirements
CO.3.55
P1.1: Identify, Prioritize and Aggregate SC Requirements
CO.3.56
The sum of the costs associated with product installation. The sum of the costs associated with invoicing. The sum of the costs associated with issuing material. The sum of the costs associated with issuing sourced or in-process material.
D1.14: Install Product D2.14: Install Product D3.14: Install Product D1.15: Invoice M1.2: Issue Material M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product D1.11: Load Vehicle & Generate Shipping Documentation D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents ES.3: Maintain Source Data
CO.3.57 CO.3.58 CO.3.59
CO.3.60
The sum of the costs associated with loading product & generating shipping documentation.
CO.3.61
The sum of the costs associated with maintaining supplier data.
2.4.18
CO
Metric ID
CO.3.62
Metric Name
Cost to Manage Business Rules for PLAN Processes Cost to Manage Business Rules for Return Processes Cost to Manage Deliver Business Rules Cost to Manage Deliver Capital Assets Cost to Manage Deliver Information Cost to Manage Finished Goods Inventories Cost to Manage Import/Export Requirements Cost to Manage In-Process Products (WIP) Cost to Manage Incoming Product Cost to Manage Integrated Supply Chain Capital Assets Cost to Manage Integrated Supply Chain Inventory Cost to Manage Integrated Supply Chain Transportation Cost to Manage MAKE Equipment and Facilities
Metric Denition
The sum of the .Costs to Manage Business Rules for PLAN Processes The sum of the Cost to Manage Business Rules for Return Processes The sum of the Costs to Manage Deliver Business Rules The sum of the Costs to Manage Deliver Capital Assets The sum of the Cost to Manage Deliver Information The sum of the Costs to Manage Finished Good Inventory The sum of the costs associated with the management of import/export requirements The sum of the costs associated with managing in-process products (WIP). The sum of the costs associated with managing incoming product. The sum of the costs associated with managing integrated supply chain assets. The sum of the costs associated with managing the integrated supply chain inventory. The sum of the costs associated with managing integrated supply chain transportation. The sum of the costs associated with managing Make equipment and facilities.
Process
EP.1: Manage Business Rules for Plan Processes ER.1: Manage Business Rules for Return Processes ED.1: Manage Deliver Business Rules ED.5: Manage Deliver Capital Assets ED.3: Manage Deliver Information
CO.3.63
CO.3.64
CO.3.65
CO.3.66
CO.3.67
ED.4: Manage Finished Goods Inventories ED.8: Manage Import/Export Requirements ES.8: Manage Import/Export Requirements EM.4: Manage In-Process Products (WIP) ES.6: Manage Incoming Product EP.5: Manage Integrated Supply Chain Capital Assets
CO.3.68
CO.3.69
CO.3.70 CO.3.71
CO.3.72
EP.4: Manage Integrated Supply Chain Inventory EP.6: Manage Integrated Supply Chain Transportation
CO.3.73
CO.3.74
2.4.19
CO
Metric ID
CO.3.75 CO.3.76
Metric Name
Cost to Manage MAKE Information Cost to Manage MAKE Regulatory Compliance Cost to Manage Performance of Return Processes Cost to Manage Performance of Supply Chain Cost to Manage PLAN Data Collection Cost to Manage Plan Regulatory Requirements and Compliance Cost to Manage Planning Conguration Cost to Manage Product Inventory Cost to Manage Product Life Cycle Cost to Manage Production Network Cost to Manage Production Performance Cost to Manage Production Rules Cost to Manage Return Capital Assets Cost to Manage Return Data Collection Cost to Manage Return Inventory
Metric Denition
The sum of the Cost to Manage MAKE Information The sum of the Cost to Manage MAKE Regulatory Compliance The sum of the costs to Manage Performance of Return Processes. The sum of the costs associated with assessing supplier performance. The sum of the costs to Manage PLAN Data Collection. The sum of the costs to Manage Plan Regulatory Requirements and Compliance. The sum of the Cost to Manage Planning Conguration The sum of the Cost to Manage Product Inventory The sum of the Cost to Manage Product Life Cycle The sum of the costs to manage the production network The sum of the costs to manage production performance. The sum of the costs to manage production rules. The sum of the costs to manage the capital assets associated with returns. The sum of the costs to manage the capital assets associated with returns data collection. The sum of the costs to manage the capital assets associated with return inventory.
Process
EM.3: Manage Make Information EM.8: Manage Make Regulatory Environment ER.2: Manage Performance of Return Processes EP.2: Manage Performance of Supply Chain EP.3: Manage Plan Data Collection
CO.3.77
CO.3.78
CO.3.79
CO.3.80
CO.3.81
EP.7: Manage Planning Conguration ES.4: Manage Product Inventory ED.7: Manage Product Life Cycle EM.7: Manage Production Network
CO.3.82 CO.3.83 CO.3.84
CO.3.85
EM.2: Manage Production Performance EM.1: Manage Production Rules ER.5: Manage Return Capital Assets
CO.3.86 CO.3.87
CO.3.88
CO.3.89
ER.4: Manage Return Inventory
2.4.20
CO
Metric ID
CO.3.90
Metric Name
Cost to Manage Return Network Conguration Cost to Manage Return Regulatory Requirements and Compliance Cost to Manage Return Transportation Cost to Manage Source Capital Assets Cost to Manage Sourcing Business Rules Cost to Manage Supplier Agreements Cost to Manage Supplier Network Cost to Manage Transportation Cost to Negotiate & Receive Contract Cost to Obtain & Respond to Request for Quote (RFQ) / Request for Proposal (RFP) Cost to Pack Product Cost to Package
Metric Denition
The sum of the costs to manage the capital assets associated with conguring the return network. The sum of the costs associated with managing compliance to return regulatory requirements. The sum of the costs associated with managing return transportation. The sum of the Costs to Manage Source Capital Assets The sum of the costs associated with Source business rules. The sum of the costs associated with managing supplier agreements. The sum of the costs associated with managing the supplier network. The sum of the costs associated with managing Finished Good Transportation The sum of the costs associated with negotiating and receiving contracts The sum of the costs associated with obtaining and responding to Request for Quote (RFQ) / Request for Proposal (RFP). The sum of the costs associated with product packaging. The sum of the costs associated with product packaging. The sum of the costs associated with picking product. The sum of the costs associated with picking product from backroom.
Process
ER.7: Manage Return Network Conguration ER.8: Manage Return Regulatory Requirements and Compliance
CO.3.91
CO.3.92
ER.6: Manage Return Transportation ES.5: Manage Capital Assets
CO.3.93
CO.3.94
ES.1: Manage Sourcing Business Rules ES.10: Manage Supplier Agreements ES.7: Manage Supplier Network EM.6: Manage Transportation (WIP) ED.6: Manage Transportation D3.2: Negotiate and Receive Contract D3.1: Obtain and Respond to RFP/ RFQ
CO.3.95
CO.3.96 CO.3.97
CO.3.98
CO.3.99
CO.3.100
D1.10: Pack Product D2.10: Pack Product D3.10: Pack Product M1.4: Package M2.4: Package M3.5: Package D1.9: Pick Product D2.9: Pick Product D3.9: Pick Product D4.3: Pick Product from Backroom
CO.3.101
CO.3.102
Cost to Pick Product Cost to Pick Product from Backroom
CO.3.103
2.4.21
CO
Metric ID
CO.3.104 CO.3.105 CO.3.106 CO.3.107 CO.3.108 CO.3.109 CO.3.110
Metric Name
Cost to Plan Deliver Cost to Plan Make Cost to Plan Return Cost to Plan Source Cost to Plan Supply Chain Cost to Process Inquiry & Quote Cost to Produce and Test Cost to Receive & Verify Product by Customer
Metric Denition
The sum of the costs associated with planning the delivery of product. The sum of the costs associated with planning the making of product. The sum of the costs associated with planning the returning of product. The sum of the costs associated with planning source activities. The sum of the costs associated with planning supply chain activities. The sum of the costs associated with processing inquiry and quotes. The sum of the costs associated with production and test. The sum of the costs associated with receipt and verication at customer site.
Process
P4: Plan Deliver P3: Pan Make P5: Plan Return P2: Plan Source P1: Plan Supply Chain D1.1: Process Inquiry and Quote D2.1: Process Inquiry and Quote M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test D1.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D3.13: Receive and Verify Product by Customer DR1.3: Receive Defective Product DR3.3: Receive Excess Product DR2.3: Receive MRO Product S1.2: Receive Product S2.2: Receive Product S3.4: Receive Product D4.2: Receive Product at the Store D1.8: Receive Product from Source or Make D2.8: Receive Product from Source or Make D3.8: Receive Product from Source or Make D1.2: Receive, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order
CO.3.111
CO.3.112 CO.3.113 CO.3.114 CO.3.115
Cost to Receive Defective Product Cost to Receive Excess Product Cost to Receive MRO Product Cost to Receive Product Cost to Receive Product at Store Cost to Receive Product from Source or Make
The sum of the costs associated with receiving defective product returns. The sum of the costs associated with receiving excess returns. The sum of the costs associated with receiving MRO product returns. The sum of the costs associated with receiving product. The sum of the costs associated with receiving product at the store. The sum of the costs associated with transferring product from source or make activities.
CO.3.116 CO.3.117
CO.3.118
Cost to Receive, Enter & Validate Order
The sum of the costs associated with receiving, entering and validating a customer order.
2.4.22
CO
Metric ID
CO.3.119
Metric Name
Cost to Release Finished Product to Deliver Cost to Reserve Resources & Determine Delivery Date Cost to Route Shipments Cost to Schedule Defective Product Receipt Cost to Schedule Excess Product Receipt Cost to Schedule Installation Cost to Schedule MRO Product Receipt Cost to Schedule Product Deliveries Cost to Schedule Production Activities
Metric Denition
The sum of the costs associated with releasing nished goods to deliver processes. The sum of the costs associated with reserving resources and determining a delivery date. The sum of the costs associated with routing shipments. The sum of the costs associated with scheduling defective product receipt. The sum of the costs associated with scheduling excess product receipt. The sum of the costs associated with scheduling product installation. The sum of the costs associated with scheduling MRO product receipt. The sum of the costs associated with scheduling product deliveries. The sum of the costs associated with scheduling production activities.
Process
M1.6: Release Product to Deliver M2.6: Release Finished Product to Deliver M3.7: Release Product to Deliver D1.3: Reserve Inventory and Determine Delivery Date D2.3: Reserve Inventory and Determine Delivery Date D1.6: Route Shipments D2.6: Route Shipments D3.6: Route Shipments DR1.2: Schedule Defective Return Receipt DR3.2: Schedule Excess Return Receipt D3.4: Schedule Installation DR2.2: Schedule MRO Return Receipt S1.1: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries M1.1: Schedule Production Activities M2.1: Schedule Production Activities M3.2: Schedule Production Activities D1.7: Select Carriers and Rate Shipments D2.7: Select Carriers and Rate Shipments D3.7: Select Carriers & Rate Shipments S3.2: Select Final Supplier (S) and Negotiate D1.12: Ship Product D2.12: Ship Product D3.12: Ship Product
CO.3.120
CO.3.121
CO.3.122
CO.3.123
CO.3.124 CO.3.125
CO.3.126
CO.3.127
CO.3.128
Cost to Select Carriers & Rate Shipments
The sum of the costs associated with selecting carriers and rating shipments.
CO.3.129
Cost to Select Final Supplier(s) and Negotiate Cost to Ship Product
The sum of the costs associated with selecting nal suppliers and negotiating supplier agreements. The sum of the costs associated with shipping products.
CO.3.130
2.4.23
CO
Metric ID
CO.3.131
Metric Name
Cost to Source Return Cost to Stage Finished Product Cost to Stock Shelf Cost to Transfer Defective Product Cost to Transfer Excess Product Cost to Transfer MRO Product Cost to Transfer Product Cost to Verify Product Customer Invoicing/ Accounting Costs Direct labor cost Direct material cost Distribution Costs
Metric Denition
The sum of the costs associated with SourceReturn The sum of the costs associated with staging nished goods. The sum of the costs associated with stocking shelves. The sum of the costs associated transferring defective product for disposition The sum of the costs associated transferring excess product for disposition The sum of the costs associated transferring MRO product for disposition The sum of the costs associated with transferring product to Make or Deliver processes The sum of the costs associated with raw material verication. Includes costs for invoicing, processing customer payments, and verifying customer satisfaction. Direct cost spent on production labor Direct cost spent on material for production The costs of distribution (warehousing and transportation of nished goods) as a percent of total supply chain costs The energy consumed by the Make process per unit produced.
Process
SR1: Source Return Defective Product SR3: Source Return Excess Product M1.5: Stage Product M2.5: Stage Finished Product M3.6: Stage Finished Product D4.4: Stock Shelf DR1.4: Transfer Defective Product
CO.3.132
CO.3.133 CO.3.134
CO.3.135
DR3.4: Transfer Excess Product
CO.3.136
CO.3.137
S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product S1.3: Verify Product S2.3: Verify Product S3.5: Verify Product D1.15: Invoice, D2.15: Invoice, D3.15: Invoice EM.2: Manage Production Performance EM.2: Manage Production Performance P4.4: Establish Delivery Plans
CO.3.138
CO.3.139
CO.3.140 CO.3.141 CO.3.142
CO.3.143
Energy consumption
M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test P3: Plan Make P3: Plan Make
CO.3.144
Energy Cost per Unit
The cost of energy inputs for the Make process per unit produced.
2.4.24
CO
Metric ID
CO.3.145
Metric Name
Energy Costs
Metric Denition
the cost of energy inputs to S1.4 as a percent of total product transfer and storage costs.
Process
S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product M2: Make-to- Order D2: Deliver Make-to-Order Product D1.6: Route Shipments D2.6: Route Shipments D3: Deliver Engineer-to-Order Products DR1.3: Receive Defective Product DR2.4: Transfer MRO Product DR3.2: Schedule Excess Return Receipt EM.5: Manage Make Equipment and Facilities
CO.3.146
Energy ecient upgrades
The percent of new equipment purchased over the past year that is more energy ecient than the equipment it replaces The cost of complying with environmental regulations and policies as a percent of total supply chain costs. The cost impact of compliance violations with environmental regulations and policies as a percent of total supply chain costs. The risk (probability X impact) of risk events. i.e. plant outage, transportation outage, product failure, etc.
CO.3.147
Environmental Compliance Cost Environmental non-compliance cost Event Risk (EVAR) ($)
P1: Plan Supply Chain EP.8: Manage Plan Regulatory Requirements and Compliance EP.8: Manage Plan Regulatory Requirements and Compliance
CO.3.148
CO.3.149
EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk SR3.2: Disposition Excess Product
CO.3.150
Excess product disposition costs as % total Source cost Finished Goods Inventory Days of Supply
Excess product disposition costs as % total Source cost
CO.3.151
Finished goods inventory days of supply are calculated as gross nished goods inventory (value of transfers/365 days).
D1: Deliver Stocked Products D2: Deliver Make-to-Order Product D3: Deliver Engineer-to-Order Products ED.4: Manage Finished Goods Inventories
2.4.25
CO
Metric ID
CO.3.152
Metric Name
Gross Risk ($)
Metric Denition
The total unmitigated risk for a specic area, supplier, product, etc.($)
Process
EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk M1.3: Produce and Test M3.4: Produce and Test ES.4: Manage Product Inventory
CO.3.153
Hazardous waste generated at warehousing facilities as % of total waste generated Hedge Rating (Inventory DOS for risk management)
The weight of hazardous waste generated from warehousing operations as a percent of the total waste generated
CO.3.154
The amount of inventory in use as a risk mitigation tactic (DOS)
EP.9: Manage Supply Chain Plan Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk EM.2: Manage Production Performance EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk EP.9: Manage Supply Chain Plan Risk
CO.3.155
Indirect cost related to production Individual Process Area Event Rating (EVAR) ($)
Indirect cost incurred in production indirectly The specic rating (probability X impact) of a specic event.
CO.3.156
CO.3.157
Industry Benchmark Comparison (%)
Industry Benchmark Comparison (%)
2.4.26
CO
Metric ID
CO.3.158
Metric Name
Mitigated Risk ($)
Metric Denition
The total mitigated risk for a specic area, supplier, product, etc.($)
Process
EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk SR2.2: Disposition MRO Product
CO.3.159
Mitigation cost by Event ($)
The cost of mitigation for a specic risk event ($)
CO.3.160
MRO Disposition Costs As % Total Source cost NPDES permitted water euent Number of worker absences due to poor IAQ Order Management Costs Packaging material re-use Packaging purchases Packaging volume Peak Time Energy Use
MRO Disposition Costs As % Total Source cost The weight of water pollutant emitted per weight of nished good produced The annual hours of worker absences that can be attributed to indoor air quality issues The aggregation of the following cost elements (contained in this glossary): The percent of packaging materials that are reused The cost of packaging materials used during transfer operations Total volume of packaging material per unit divided by total unit volume % of total energy consumption that occurs during regional peak demand times Compliance costs directed to pollution prevention activities as a percent of total compliance costs.
CO.3.161
M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test ES.4: Manage Product Inventory EM.5: Manage Make Equipment and Facilities D1: Deliver Stocked Products D3: Deliver Engineer-to-Order Products M1.4: Package M3.5: Package ES.4: Manage Product Inventory S1.4: Transfer Product EM.6: Manage Transportation (WIP) M2.1: Schedule Production Activities M1.1: Schedule Production Activities EM.8: Manage Make Regulatory Environment
CO.3.162
CO.3.163
CO.3.164
CO.3.165 CO.3.166 CO.3.167
CO.3.168
Pollution Prevention Ratio
2.4.27
CO
Metric ID
CO.3.169
Metric Name
Product Acquisition Costs
Metric Denition
Product acquisition costs include costs incurred for the production of product: sum of product management and planning, supplier quality engineering, inbound freight and duties, receiving and product storage, incoming inspection, product process engineering and tooling costs. The cost of material and labor to package items for transfer divided by the number of items transferred The average number of units transferred per vehicle The average number of units transferred per vehicle
Process
S1: Source Stocked Product S2: Source Make-to-Order Product S3: Source Engineer-to-Order Product
CO.3.170
Product Packaging costs Product Shipped per delivery Quantity per shipment
S1.4: Transfer Product
CO.3.171
D1.5: Build Loads D2.5: Build Loads D3.5: Build Loads S1.1: Schedule Product Deliveries S1.4: Transfer Product S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries M1.2: Issue Material M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product D1.5: Build Loads D2.5: Build Loads SR3.3: Request Excess Product Return Authorization
CO.3.172
CO.3.173
Ratio of Authorization Cost To Total Source Cost Ratio of Authorization Cost to Total Source Return cost Ratio of authorization costs to total source return cost
Ratio of Authorization Cost To Total Source Cost
CO.3.174
Ratio of Authorization Cost to Total Source Return cost
SR2.3: Request MRO Return Authorization
CO.3.175
Ratio of authorization costs to total source return cost
SR1.3: Request Defective Product Return Authorization
2.4.28
CO
Metric ID
CO.3.176
Metric Name
Residual Risk ($)
Metric Denition
The residual (gross mitigated) risk for a specic area, supplier, product, etc.($)
Process
EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk SR1.5: Return Defective Product SR2.5: Return MRO Product SR3.5: Return Excess Product ED.9: Manage Supply Chain Deliver Risk
CO.3.177
Return transportation costs Risk Mitigation Costs (Deliver)
Sum of the costs associated with return transportion The total supply chain risk mitigation cost of all DELIVER mitigation actions for a specic area, supplier, product, etc. ($) The total supply chain risk mitigation cost of all MAKE mitigation actions for a specic area, supplier, product, etc. ($) The total supply chain risk mitigation cost of all PLAN mitigation actions for a specic area, supplier, product, etc. ($) The total supply chain risk mitigation cost of all RETURN mitigation actions for a specic area, supplier, product, etc. ($) The total supply chain risk mitigation cost of all SOURCE mitigation actions for a specic area, supplier, product, etc. ($) The cost of packaging material that is scrapped as part of the packaging process The percent of the assessed area (suppliers, customers, etc.) that has been systematically evaluated.
CO.3.178
CO.3.179
Risk Mitigation Costs (Make) Risk Mitigation Costs (Plan) Risk Mitigation Costs (Return)
EM.9: Manage Supply Chain Make Risk EP.9: Manage Supply Chain Plan Risk ER.9: Manage Supply Chain Return Risk
CO.3.180
CO.3.181
CO.3.182
Risk Mitigation Costs (Source)
ES.9: Manage Supply Chain Source Risk
CO.3.183
Scrap packaging expense Supply / Customer / Product Base Rated (%)
M1.4: Package M2.4: Package M3.5: Package EP.9: Manage Supply Chain Plan Risk ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk P4: Plan Deliver
CO.3.184
CO.3.185
Total Deliver Costs
The sum of the costs associated with the Deliver processes.
2.4.29
CO
Metric ID
CO.3.186
Metric Name
Total Excess Material Return Costs Total Source Return Costs Transportation Costs
Metric Denition
The sum of the costs associated with the receipt of returned excess products from the customer The sum of the costs associated with the return of raw materials to the supplier. The costs of transportation per unit shipped
Process
SR3: Source Return Excess Product
CO.3.187
SR2: Return MRO Product
CO.3.188
P4.1: Identify, Prioritize and Aggregate Delivery Requirements P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements ED.9: Manage Supply Chain Deliver Risk
CO.3.189
Value at Risk (Deliver)
The sum of probability of risk events times the monetary impact of the events in all Deliver activities. Risk event here could be dened as the deviation from expected metrics value for the process. The sum of probability of risk events times the monetary impact of the events in all Make activities. Risk event here could be dened as the deviation from expected metrics value for the process. The sum of probability of risk events times the monetary impact of the events in all Return activities. Risk event here could be dened as the deviation from expected metrics value for the process. The sum of probability of risk events times the monetary impact of the events in all Sourcing activities. Risk event here could be dened as the deviation from expected metrics value for the process. Value at Risk the sum of the probability of risk events times the monetary impact of the events for the specic process.
CO.3.190
Value at Risk (Make)
EM.9: Manage Supply Chain Make Risk
CO.3.191
Value at Risk (Return)
ER.9: Manage Supply Chain Return Risk
CO.3.192
Value at Risk (Source)
ES.9: Manage Supply Chain Source Risk
CO.3.193
VAR of Internal Process Performance
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk
2.4.30
CO
Metric ID
CO.3.194
Metric Name
VAR of Supplier Performance
Metric Denition
Value at Risk the sum of the probability of risk events times the monetary impact of the events for the specic supplier (or aggregate supply base)
Process
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk ES.4: Manage Product Inventory
CO.3.195
Warehouse energy costs Warehousing solid waste Waste produced as % of product produced Waste storage costs as % of Make costs Water use reduction
The cost of energy inputs for warehouse operations as a % of total storage costs The annual weight of waste generated from warehousing processes The weight of waste (air, liquid and solid) divided by the weight of nished goods product produced. The cost to store and manage production waste as a per cent of total Make costs The annual % reduction in water use per warehousing cost
CO.3.196 CO.3.197
ES.4: Manage Product Inventory M1.3: Produce and Test M2.3: Produce and Test M1.7: Waste Disposal M2.7: Waste Disposal M3.8: Waste Disposal ES.4: Manage Product Inventory
CO.3.198
CO.3.199
2.4.31
2.4.32
AM.1.1
Cash-to-Cash Cycle Time
The time it takes for an investment made to ow back into a company after it has been spent for raw materials. For services, this represents the time from the point where a company pays for the resources consumed in the performance of a service to the time that the company received payment from the customer for those services.
Qualitative Relationship Description The longer the cash-to-cash cycle, the more current assets needed (relative to current liabilities) since it takes longer to convert inventories and receivables into cash. In other words, the longer the cashto-cash cycle, the more net working capital required. Quantitative Relationship (optional, if calculable) The Cash-to-Cash Cycle time is measured by converting into days the supply of inventory in stock and the number of days outstanding for accounts receivable and accounts payable. The inventory days of supply is added to the days outstanding for accounts receivable. The accounts payable days outstanding is subtracted from this total to determine the cash-to-cash cycle time. Calculation Cash-to-Cash Cycle Time = Inventory Days of Supply + Days Sales Outstanding Days Payable Outstanding Level 2 Metrics: AM.2.2 Inventory Days of Supply = the amount of inventory (stock) expressed in days of sales. The [5 point rolling average of gross value of inventory at standard cost] / [annual cost of goods sold (COGS) / 365] Example: If 2 items a day are sold and 20 items are held in inventory, this represents 10 days (20/2) sales in inventory. (Other names: Days cost-of-sales in inventory, Days sales in inventory) AM.2.1 Days Sales Outstanding = the length of time from when a sale is made until cash for it is received from customers. The amount of sales outstanding expressed in days. The [5 point rolling average of gross accounts receivable (AR)] / [total gross annual sales / 365]. Example: If $5000 worth of sales were made per day and $50,000 worth of sales were outstanding, this would represent 10 days ($50,000/$5000) of sales outstanding. (Other names: Days sales in Accounts receivables) AM.2.3 Days Payable Outstanding = the length of time from purchasing materials, labor and/ or conversion resources until cash payments must be made expressed in days. The [5 point rolling average of gross accounts payable (AP)] / [total gross annual material purchases / 365]. (Other names: Average payment period for materials, Days purchases in accounts payable, Days
2.5.1
AM.1.1
Calculation cont. The 5 point rolling average calculation uses a combination of both historical and forward-looking data. This means that the rolling average value has to be calculated based on the average over the four previous quarters and the projection for the current or next quarter. The 5 point rolling average calculation is: [Sum of the 4 previous quarters + projection for next quarter) / 5] Data Collection Unlike the other SCOR attributes, where data requirements are specied, typically all of the cash-tocash cycle time source data is already captured by business operating systems: general ledger system accounts receivable system accounts payable system purchasing system production reporting system customer relationship management system As a result, information is calculated by importing data from these systems and transforming them into the prescribed analytics/information. The transformation is accomplished using business rules. Discussion Cash-to-cash Cycle Time is a value metric used to measure how eciently a company manages its working capital assets. This metric is a generally accepted Supply Chain metric within many industries and is used to benchmark supply chain asset management performance. The term 5 point annual average can be confusing in that it can imply a measure over a years period of time when the data points are taken over 5 quarters. The intent of the approach is to smooth the seasonal peaks and valleys over time and to balance projected data with historical data. The measurement can be taken quarterly or at any given consistent time frame. Hierarchical Metric Structure
Level 1
AM.1.1 Cash-to-Cash Cycle Time AM.2.1 Days Sales Outstanding
Level 2
AM.2.2 Inventory Days of Supply AM.2.3 Days of Payable Outstanding
2.5.2
AM.1.2
Return on Supply Chain Fixed Assets
Return on Supply Chain Fixed Assets measures the return an organization receives on its invested capital in supply chain xed assets. This includes the xed assets used in Plan, Source, Make, Deliver, and Return.
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) The return on supply chain xed assets is measured by monetizing the supply chain revenue, cost of goods sold and supply chain management costs to determine the prot from the respective supply chain. This amount is divided by the supply chain xed assets to determine the return generated from the respective supply chain. Calculation Return on Supply Chain Fixed Assets = (Supply Chain Revenue COGS Supply Chain Management Costs) / Supply-Chain Fixed Assets Supply Chain Revenue is used in the metric rather than just Net Revenue. SC Revenue is calculated as: Supply Chain Revenue - COGS - Total Supply Chain Management Costs. This provides the revenue generated through the supply chain less the total costs associated with the supply chain. There is a need for a more specic revenue number than Net Revenue for use in the Supply Chain Revenue level 2 metric. Net Revenue could include revenue from sources other than the supply chain, such as investments, leasing real estate, court settlements, etc... Supply Chain Revenue will be used and will be only the portion of Net Revenue that is generated by the specic supply chain being measured and analyzed. Level 2 Metrics Supply-Chain Revenue Operating revenue generated from a supply chain. This does not include non-operating revenue, such as leasing real estate, investments, court settlements, sale of oce buildings, etc... CO.1.2 COGS (Cost of Goods Sold) Calculation - Refer to the section for COGS in the Attribute for Costs. CO.1.1 Total Supply Chain Management Costs Calculation - refer to the section for Supply-Chain Management Costs in the Attribute for Costs. AM.2.5 Supply Chain Fixed Assets Source Fixed Asset Value + Make Fixed Asset Value + Deliver Fixed Asset Value + Return Fixed Asset Value + Plan Fixed Asset Value
2.5.3
AM.1.2
Calculation cont. Level 3 Metrics Plan Fixed Asset Value- The current value of the supply chain assets used in supply chain integration (See EP.5) Source Fixed Asset Value - The current value of the supply chain assets used in the Source process. (See ES.5) Make Fixed Asset Value- The current value of the supply chain assets used in the Make process. (See EM.5) Deliver Fixed Asset Value - The current value of the supply chain assets used in the Deliver process. (See ED.5) Return Fixed Asset Value - The current value of the supply chain assets used in the Return process. (See ER.5) A Revised Capital Plan is an output of the Manage Integrated Supply Chain Fixed Assets (EP.5) process element and would contain supply chain capital asset information that could be used in measuring the Supply Chain Fixed Assets. Data Collection Unlike the other SCOR attributes, where data requirements are specied, typically all of the return on working capitals source data is already captured by business operating systems: general ledger system xed asset system purchasing system labor reporting system production reporting system customer relationship management system As a result, information is calculated by importing data from these systems and transforming them into the prescribed analytics/information. The transformation is accomplished using business rules. In order to measure Return on Supply Chain Fixed Assets, the investment in supply chain capital assets needs to be known. This requires a clear understanding of what is a supply chain xed asset. SCOR Ex.5 process elements were used since these are all focused on managing SC capital assets. It is the assets managed in these Enable processes that comprise Supply Chain Fixed Assets. The value of these assets is the denominator of the metric. Discussion Range of xed assets used in an organization that have the character of permanency rather than being rapidly replaced (or expensed); examples include land, warehouse, trucks, buildings, investments, and plant and machinery. Fixed assets used to operate the Supply Chain in each of the categories (P, S, M, D, R) are tracked within the Ex.5 process elements. A Revised Capital Plan is an output of the Manage Integrated Supply Chain Fixed Assets (EP.5) process element and would contain supply chain capital asset information that could be used in measuring the Supply Chain Fixed Asset Value.
2.5.4
AM.1.2
Level 1
AM.1.2 Return on Supply Chain Fixed Assets Supply Chain Revenue
Level 2
CO.1.1 Supply Chain Management Costs CO.1.2 Cost of Goods Sold AM.2.5 Supply Chain Fixed Assets Source Fixed Asset Value Make Fixed Asset Value
Level 3
Deliver Fixed Asset Value Return Fixed Asset Value Plan Fixed Asset Value
2.5.5
AM.1.3
Return on Working Capital
Return on working capital is a measurement which assesses the magnitude of investment relative to a companys working capital position verses the revenue generated from a supply chain. Components include accounts receivable, accounts payable, inventory, supply chain revenue, cost of goods sold and supply chain management costs. (Processes: P1, P2, P3, P4, S1, S2, S3, M1, M2, M3, D1, D2, D3, D4)
Qualitative Relationship Description None Identied Quantitative Relationship (optional, if calculable) The return on working capital is measured by monetizing the supply chain prot and dividing into the calculated amount the supply chain working capital position. Calculation Return on Working Capital = (Supply Chain Revenue COGS Supply Chain Management Costs) / (Inventory + Accounts Receivable Accounts Payable) Level 2 Metrics: Supply-Chain Revenue Operating revenue generated from a supply chain. This does not include non-operating revenue, such as leasing real estate, investments, court settlements, sale of oce buildings, etc... CO.1.2 COGS (Cost of Goods Sold) Calculation - Refer to the section for COGS in the Attribute for Costs. CO.1.1 Total Supply Chain Management Costs Calculation - refer to the section for Supply-Chain Management Costs in the Attribute for Costs. AM.2.8 Inventory = the amount of inventory (stock) expressed in dollars. The [5 point rolling average of gross value of inventory at standard cost] AM.2.7 Sales Outstanding = the amount of accounts receivable outstanding expressed in dollars. The [5 point rolling average of gross accounts receivable (AR)] AM.2.6 Payables Outstanding = expressed in dollars, the amount of purchased materials, labor and/or conversion resources that are to be paid (accounts payable). The [5 point rolling average of gross accounts payable (A/P)] The 5 point rolling average calculation uses a combination of both historical and forward-looking data. This means that the rolling average value has to be calculated based on the average over the four previous quarters and the projection for the current or next quarter. The 5 point rolling average calculation is: [Sum of the 4 previous quarters + projection for next quarter) / 5]
2.5.6
AM.1.3
Calculation cont. Level 3 Metrics Plan Fixed Asset Value- The current value of the supply chain assets used in supply chain integration (See EP.5) Source Fixed Asset Value - The current value of the supply chain assets used in the Source process. (See ES.5) Make Fixed Asset Value- The current value of the supply chain assets used in the Make process. (See EM.5) Deliver Fixed Asset Value - The current value of the supply chain assets used in the Deliver process. (See ED.5) Return Fixed Asset Value - The current value of the supply chain assets used in the Return process. (See ER.5) A Revised Capital Plan is an output of the Manage Integrated Supply Chain Fixed Assets (EP.5) process element and would contain supply chain capital asset information that could be used in measuring the Supply Chain Fixed Assets. Data Collection Unlike the other SCOR attributes, where data requirements are specied, typically all of the return on working capitals source data is already captured by business operating systems: general ledger system accounts receivable system accounts payable system purchasing system labor reporting system production reporting system customer relationship management system As a result, information is calculated by importing data from these systems and transforming them into the prescribed analytics/information. The transformation is accomplished using business rules. Discussion Supply Chain Revenue is used in the metric rather than just Net Revenue. SC Revenue is calculated as: Supply Chain Revenue - COGS - Total Supply Chain Management Costs. This provides the revenue generated through the supply chain less the total costs associated with the supply chain. There is a need for a more specic revenue number than Net Revenue for use in the Supply Chain Revenue level 2 metric. Net Revenue could include revenue from sources other than the supply chain, such as investments, leasing real estate, court settlements, etc... Supply Chain Revenue will be used and will be only the portion of Net Revenue that is generated by the specic supply chain being measured and analyzed.
2.5.7
AM.1.3
Level 1
AM.1.3 Return on Working Capital CO.1.1 Supply Chain Management Costs CO.1.2 Cost of Goods Sold
Level 2
AM.2.6 Accounts Payable (Payables Outstanding) AM.2.7 Accounts Receivable (Sales Outstanding) AM.2.8 Inventory Supply Chain Revenue
2.5.8
AM
Level 3 Asset Management Metrics
Metric ID Metric Name
AM.3.1 % of hazardous material in inventory
Metric Denition
The weight of hazardous material in inventory as a percent of total inventory weight % of the product content that has a supplier take-back program for recycling or reuse. % of the product content that is recyclable or reusable The percent of scrap from packaging that is immediately reused in the packaging process The percent of scrap from production that is immediately reused in the production process the weight of recycled material in the product as a percent of total product weight Measure of total lifecycle maintenance cost of an asset compared to its replacement cost. This ratio is based maintenance cost to-date so that that replacement or upgrade cost can be evaluated as the asset ages on an ongoing basis. Average age of Excess Inventory A measure of how intensively a resource is being used to produce a good or service. Some factors that should be considered are internal manufacturing capacity, constraining processes, direct labor availability and key components/materials availability.
Process
ED.4: Manage Finished Goods Inventories
AM.3.2
% of material that has a valid Take-back program % of materials that are recyclable/ reusable % of packaging/shipping materials reused internally % of production materials reused
AM.3.3 AM.3.4
S3.1: Identify Sources of Supply M2.4: Package
AM.3.5
M3.4: Produce and Test M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test M1.3: Produce and Test M2.3: Produce and Test EM.5: Manage Make Equipment and Facilities
AM.3.6
% of products consisting of previously used components Actual Asset Life Maintenance Cost as % of Replacement Value
AM.3.7
AM.3.8 AM.3.9
Average age of Excess Inventory Capacity Utilization
SR3: Source Return Excess Product M3.4: Produce and Test M1.3: Produce and Test M2.3: Produce and Test M1.4: Package M2.4: Package M3.5: Package M1.1: Schedule Production Activities M2.1: Schedule Production Activities M3.2: Schedule Production Activities
2.5.9
AM
AM.3.10 Defective product disposition costs as % total Source Return cost Deliver Fixed Asset Value
Metric Denition
Defective product disposition costs as % total Source Return cost Deliver Fixed Asset Value - The current value of the supply chain assets used in the Deliver process. The average time associated with returns.
Process
AM.3.11
ED.5: Manage Deliver Capital Assets
AM.3.12
Deliver Return Cycle Time
DR1: Deliver Return Defective Product DR2: Deliver Return MRO Product EM.5: Manage Make Equipment and Facilities
AM.3.13
Equipment energy eciency
The number of capital equipment units that meet energy eciency standards as a per cent of total capital equipment units The % of material (by weight) issued for production that is classied as hazardous material The % of waste (by weight) generated from production that is classied as hazardous material Value of raw materials (COGS 365).
AM.3.14
Hazardous materials used during production process as a % of all materials Hazardous waste as % of total waste
M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test M1.7: Waste Disposal M2.7: Waste Disposal M3.8: Waste Disposal S1: Source Stocked Product S2: Source Make-to-Order Product S3: Source Engineer-to-Order Product M2: Make-to- Order M3: Engineer-to-Order EM.5: Manage Make Equipment and Facilities M1.2: Issue Material M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product EM.6: Manage Transportation (WIP) EP.5: Manage Integrated Supply Chain Capital Assets
AM.3.15
AM.3.16
Inventory Days of Supply (Raw Material)
AM.3.17 AM.3.18
Inventory Days of Supply (WIP) Make Fixed Asset Value
Total value of Work in Process (COGS 365). The current value of the supply chain assets used in the Make process The % by weight of packaging material to total raw material weight
AM.3.19
Packaging as % of total material
AM.3.20
Plan Fixed Asset Value
The current value of the supply chain assets used in supply chain integration
2.5.10
AM
AM.3.21 Rebuild or recycle rate
Metric Denition
Number of returned products that are rebuilt or recycled as a percent of the total number of products returned The % of waste (by weight) generated from production that is recyclable Days of supply of recyclable inventory awaiting processing The current value of the supply chain assets used in the Return process Number of returns that are for recycling or re use as a per cent of the total number of products returned Weight of products returned divided by the weight of product shipped The current value of the supply chain assets used in the Source process Value of defective product inventory in authorization stage/ total defective product inventory value Inventory Awaiting Return
Process
SR1: Source Return Defective Product SR1.5: Return Defective Product SR2: Return MRO Product M1: Make-to-stock M2: Make-to- Order M3: Engineer-to-Order ER.4: Manage Return Inventory ER.5: Manage Return Capital Assets DR3: Deliver Return Excess Product
AM.3.22
Recyclable waste as % of total waste Recycle DOS Return Fixed Asset Value
AM.3.23 AM.3.24
AM.3.25
Return for Recycle Rate
AM.3.26
Return Rate
DR1: Deliver Return Defective Product ES.5: Manage Capital Assets
AM.3.27
Source Fixed Asset Value
AM.3.28
Value of defective product inventory/ total defective product inventory value Value of Defective Inventory in Disposition Stage/ Total Inventory Value
DR1: Deliver Return Defective Product
AM.3.29
SR1.1: Identify Defective Product Condition SR1.2: Disposition Defective Product SR2.2: Disposition MRO Product SR1.3: Request Defective Product Return Authorization DR1.1: Authorize Defective Product Return SR1.5: Return Defective Product
AM.3.30
Value of Defective Product Inventory in Request Return Authorization Stage/ Total Value of defective product inventory in physical return
Inventory awaiting return authorization.
AM.3.31
Value of defective product inventory in physical return and transportation stage/ total defective inventory value
2.5.11
AM
AM.3.32 Value of defective product in scheduling stage/ total defective product Value of Excess Inventory in Disposition Stage/ Total Inventory Value Value of excess product inventory in physical return and transportation stage/tot Value of Excess Product Inventory in Request Return Authorization Stage/ Total Ex Value of excess inventory in identication stage/ total inventory value Value of excess inventory/ total inventory value Value of excess product in scheduling stage/ total excess product inv Value of Unserviceable MRO Inventory In Disposition Stage/ Total MRO Inventory Va Value of unserviceable mro inventory in physical return and transportation stage/ Value of Unserviceable MRO Inventory in Request Return Authorization Stage/ Total Value of Unserviceable MRO Inv. in Identication Stage/ Total MRO Inv. Value Value of Unserviceable MRO Inventory in Scheduling Stage/Total MRO Inventory
Metric Denition
Value of defective product in scheduling stage/ total defective product Inventory Awaiting Return
Process
SR1.4: Schedule Defective Product Shipment
AM.3.33
SR3.2: Disposition Excess Product SR3.5: Return Excess Product
AM.3.34
Value of excess product inventory in physcial return and transportation stage/tot Inventory Awaiting Return Authorization Value of excess inventory in identication stage/ total inventory value
AM.3.35
SR3.3: Request Excess Product Return Authorization SR3.1: Identify Excess Product Condition
AM.3.36
AM.3.37
Value of excess inventory/ total inventory value Value of excess product inventory in scheduling stage/ total excess product inventory value Inventory awaiting disposition
SR3: Source Return Excess Product SR3.4: Schedule Excess Product Shipment
AM.3.38
AM.3.39
SR2.2: Disposition MRO Product DR2: Deliver Return MRO Product SR2.5: Return MRO Product
AM.3.40
Value of unserviceable mro inventory in physical return and transportation stage/ Inventory awaiting return authorization Value of Unserviceable MRO Inventory In Identication Stage/Total MRO Inventory Value Value of Unserviceable MRO inventory in Scheduling Stage/ Total MRO Inventory Value
AM.3.41
SR2.3: Request MRO Return Authorization SR2.1: Identify MRO Product Condition
AM.3.42
AM.3.43
SR2.4: Schedule MRO Shipment
2.5.12
AM
AM.3.44 Value of Unserviceable MRO Inventory in Deliver Return Process/ Total MRO Inv.
Metric Denition
Value of Unserviceable MRO Inventory in Deliver Return Process/ Total MRO Inv.
Process
ER.4: Manage Return Inventory
2.5.13
2.5.14
Section 3 Processes
P
Plan
The processes associated with determining requirements and corrective actions to achieve supply chain objectives.
Process Categories P1: Plan Supply Chain The development and establishment of courses of action over specied time periods that represent a projected appropriation of supply chain resources to meet supply chain requirements for the longest time fence constraints of supply resources. The development and establishment of courses of action over specied time periods that represent a projected appropriation of material resources to meet supply chain requirements. The development and establishment of courses of action over specied time periods that represent a projected appropriation of production resources to meet production requirements. The development and establishment of courses of action over specied time periods that represent a projected appropriation of delivery resources to meet delivery requirements. A strategic or tactical process to establish and adjust courses of action or tasks over specied time periods that represent a projected appropriation of return resources and assets to meet anticipated as well as unanticipated return requirements. The scope includes unplanned returns of sold merchandise as well as planned returns of rotable products that are refurbished for reissue to customers. The collection of processes associated with managing and monitoring Plan process data, performance and relationships.
P2: Plan Source
P3: Plan Make
P4: Plan Deliver
P5: Plan Return
EP: Enable Plan
3.1.1
P1
Plan Supply Chain
The development and establishment of courses of action over specied time periods that represent a projected appropriation of supply chain resources to meet supply chain requirements for the longest time fence constraints of supply resources.
Performance Attributes Supply Chain Responsiveness Supply Chain Asset Management Metric Order Fulllment Cycle Time, Plan Cycle Time Return on Working Capital, Cash-To-Cash Cycle Time, Return on Supply Chain Fixed Assets Cost to Plan Supply Chain, Environmental Compliance Cost Description/Denition None identied
Supply Chain Costs Best Practices All Functions and Organizations Understand Their Impact on Supply/ Demand Balancing, Including Sales, Marketing, Product Management, Manufacturing, Customer, Suppliers, Materials Management, and Product Development Change in the Demand Signal Instantaneously Recongures the Production and Supply Plans Collaborative Planning, Forecasting, Replenishment (CPFR)
Event-driven supply chain re-planning
Collaborative Planning, Forecasting and Replenishment is a concept that allows collaborative processes across the supply chain, using a set of process and technology models....(From www.cpfr.org/intro.html) None identied
Supply Chain is Designed to Have Supply Flexibility Equal to Demand Volatility On-Line Visibility of All SupplyChain Demand Requirements and Resources, both Currently Available and Committed (Pegged)
Enterprise resource planning system Customer relationship management system
3.1.2
P1
Best Practices cont. Sales and Operations Planning (S&OP) Description/Denition cont. A process to develop tactical plans that provide management the ability to strategically direct its businesses to achieve competitive advantage on a continuous basis by integrating customer-focused marketing plans for new and existing products with the management of the supply chain. The process brings together all the plans for the business (sales, marketing, development, manufacturing, sourcing, and nancial) into one integrated set of plans. It is performed at least once a month and is reviewed by management at an aggregate (product family) level. The process must reconcile all supply, demand, and new-product plans at both the detail and aggregate levels and tie to the business plan. It is the denitive statement of the companys plans for the near to intermediate term, covering a horizon sucient to plan for resources and to support the annual business planning process. Executed properly, the sales and operation planning process links the strategic plans for the business with its execution and reviews performance measurements for continuous improvement. (From APICS online dictionary.) Supply chain planning optimization system
Tools Support Balanced Decision Making (e.g., Trade-O between Service Level and Inventory Investment) Supply/Demand Process is Highly Integrated from Customer Data Gathering to Order Receipt, through Production to Supplier Request Re-Balancing of Full-Stream Supply/ Demand on a Daily Basis, Including Source-Make-Deliver Resources and Requirements from Customers Customer to Suppliers Supplier Identify and manage environmental impacts Responsiveness and Flexibility Are Emphasized By Developing Expertise in Making Business Processes Re-Programmable, ReCongurable and Continuously Changeable
Integrated supply chain planning system with interfaces to all supply/demand data sources through public and private digitally enabled supply networks. Enterprise-wide planning system customer Relationship Systems
Identify and manage environmental aspects and impacts of supply chain operations to mitigate the impacts mitigate the impacts Integrated process modeling and software reconguration tools
3.1.3
P1
Best Practices cont. Capability to Run Simulated FullStream Supply/Demand Balancing for What-If Scenarios Environmental Management System (EMS) Vendor Managed Inventory Description/Denition cont. Supply chain modeling and visualization system
Implement an Environmental Management System (EMS) to track and manage environmental performance and to track performance against regulatory requirements VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Measure environmental impacts of the supply chain
Measure environmental impacts
3.1.4
P1
Revises Business Assumptions EP.10, EP.5 Customer Requirements Revised Aggregate Forecast and Projections EP.10 Shipments D1.11,D1.3 Planning Data EP.3 Order Backlog D1.11, D1.3, D2.3, D3.3
! P1.1 !
A
Supply Chain Requirements P1.3
Planning Data EP.3 Inventory Delivery Plans P4.4 Make/Buy Decision EP.5 Outsource Plan EP.5, EP.6 Production Plans P3.4 Return Regulatory Requirement ER.8 Sourcing Plans P2.4 Revised Capital Plan EP.5, EP.6
! P1.2 !
A
Supply Chain Requirements P1.3
Supply Chain Requirements P1.1 Supply Chain Performance Improvement Plan EP.2 Inventory Strategy EP.4 Planning Decision Policies EP.1 Supply Chain Resources P1.2 Revised Capital Plan EP.5, EP.6
! P1.3
P1.4 !
Supply Chain Plans P2.1, P3.1, P4.1, P5.1, EM.7
3.1.5
P1.1
Identify, Prioritize and Aggregate Supply Chain Requirements
The process of identifying, aggregating, and prioritizing, all sources of demand for the integrated supply chain of a product or service at the appropriate level, horizon and interval. The sales forecast is comprised of the following concepts: sales forecasting level, time horizon, and time interval. The sales forecasting level is the focal point in the corporate hierarchy where the forecast is needed at the most generic level. i.e. Corporate forecast, Divisional forecast, Product Line forecast, SKU, SKU by Location. The sales forecasting time horizon generally coincides with the time frame of the plan for which it was developed i.e. Annual, 1-5 years, 1- 6 months, Daily, Weekly, Monthly. The sales forecasting time interval generally coincides with how often the plan is updated, i.e. Daily, Weekly, Monthly, and Quarterly.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consider environmental impacts Digital Links (XML Based, EDI. Etc.) Among Supply Chain Members Metric Forecast Accuracy Identify, Prioritize, and Aggregate Supply Chain Requirements Cycle Time None Identied Cost to Identify, Prioritize, and Aggregate Supply Chain Requirements None Identied Description/Denition Consider environmental impacts when identifying requirements Real-time exchange of supply chain information between supply chain members collaborative planning systems, Internet Trading Exchanges, B2B Integration and Application Server Systems Collaborative Planning Systems Standards Based (RosettaNet, eBXML, OAGI, etc) B2B integration tools and systems Advance Planning and Scheduling System, Supply Chain Event Management Software Collaboration among Supply Chain partners extends outwards to customers, spanning the supply chain. Planning, Replanning, Business Rules, Plan Changes Supply Chain Advanced Planning Systems, Supply Chain Integration Systems, Integration between supply chain advanced planning and ERP execution systems, Supply Chain Capacity Planning Systems
Joint Service Agreements (JSA) Push-Based Forecasts Are Replaced with Customer Replenishment PullBased Signals Systems Support Accurate On-Line Visibility of Full-Stream Demand Requirements and Priorities Supply Chain Advance Planning System Collaboration among Operations Strategy Team
3.1.6
P1.1
Inputs
Revises Business Assumptions EP.10, EP.5 Customer Requirements Revised Aggregate Forecast and Projections EP.10 Shipments D1.11,D1.3 Planning Data EP.3 Order Backlog D1.11, D1.3, D2.3, D3.3
> P1.1
> Supply Chain Requirements P1.3
Outputs
3.1.7
P1.2
Identify, Prioritize and Aggregate Supply-Chain Resources
The process of identifying, prioritizing, and aggregating, as a whole with constituent parts, all sources of supply that are required and add value in the supply chain of a product or service at the appropriate level, horizon and interval.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consider environmental impacts Joint Service Agreements (JSA) Lead Times Updated Monthly Review Product Protability Digital Links (XML Based, EDI. Etc.) Among Supply Chain Members Metric None Identied Identify, Assess, and Aggregate Supply Chain Resources Cycle Time None Identied Cost to Identify, Assess, and Aggregate Supply Chain Resources Inventory Days of Supply Description/Denition Consider environmental impacts when identifying requirements Collaborative Planning Systems None identied ABC and cost modeling. Real-time exchange of supply chain information between supply chain members collaborative planning systems, Internet Trading Exchanges, B2B Integration and Application Server Systems
3.1.8
P1.2
Inputs
Planning Data EP.3 Inventory Delivery Plans P4.4 Make/Buy Decision EP.5 Outsource Plan EP.5, EP.6 Production Plans P3.4 Return Regulatory Requirement ER.8 Sourcing Plans P2.4 Revised Capital Plan EP.5, EP.6
> P1.2
> Supply Chain Resources P1.3
Outputs
3.1.9
P1.3
Balance Supply Chain Resources with SC Requirements
The process of identifying and measuring the gaps and imbalances between demand and resources in order to determine how to best resolve the variances through marketing, pricing, packaging, warehousing, outsource plans or some other action that will optimize service, exibility, costs, assets, (or other supply chain inconsistencies) in an iterative and collaborative environment. The process of developing a time-phased course of action that commits supply-chain resources to meet supply-chain requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Balance environmental requirements Customer Relationship Management (CRM) Metric Fill Rate Balance Supply Chain Resources with Supply Chain Requirements Cycle Time None Identied Cost to Balance Supply Chain Resources with Supply Chain Requirements Inventory Days of Supply Description/Denition Balance environmental requirements as well as supply/demand requirements Software that provides customer input and keeps the customer informed about the planning of the production and delivery process by managing all contacts and communication with the customer thorough all channels including internet and traditional sales and customer service channels. Software that provides multiple data models including the business rules and metrics for the entire supply chain planning process. Algorithms use the business rules and metrics as the drivers for the planning engine. A data warehouse / data mart is the source of all planning (master) data, business rules and transaction data. Analytical tools enable the ongoing maintenance and improvement of the business rules based on actual data.
Demand Planning, Demand Flow Leadership
Business Intelligence (BI)
3.1.10
P1.3
Inputs
Supply Chain Requirements P1.1 Supply Chain Performance Improvement Plan EP.2 Inventory Strategy EP.4 Planning Decision Policies EP.1 Supply Chain Resources P1.2
> P1.3
> None Identi ed
Outputs
3.1.11
P1.4
Establish & Communicate Supply-Chain Plans
The establishment and communication of courses of action over the appropriate timedened (long-term, annual, monthly, weekly) planning horizon and interval, representing a projected appropriation of supply-chain resources to meet supply-chain requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Asset Management Supply Chain Costs Best Practices Collaboration among Operations Strategy Team Metric None Identied Establish Supply Chain Plans Cycle Time None Identied Inventory Days of Supply Cost to Establish and Communicate Supply Chain Plans Description/Denition Supply Chain Advanced Planning Systems, Supply Chain Integration Systems, Integration between supply chain advanced planning and ERP execution systems, Supply Chain Capacity Planning Systems Real-time exchange of supply chain information between supply chain members collaborative planning systems, Internet Trading Exchanges, B2B Integration and Application Server Systems Include environmental requirements in communications. Collaboration among Supply Chain partners extends outwards to customers, spanning the supply chain. Planning,Re-planning,Business Rules,Plan Changes Advance Planning and Scheduling System
Digital Links (XML Based, EDI. Etc.) Among Supply Chain Members
Communicate environmental requirements Supply Chain Advance Planning System
Systems Support Accurate On-Line Visibility of Full-Stream Demand Requirements and Priorities as Well as Resource Utilization and Availability Collaborate with supply chain partners Joint Service Agreements (JSA)
Supply chain partners collaborate to improve the environmental performance of the supply chain Collaborative Planning Systems
Inputs
None Identi ed
> P1.4
> Supply Chain Plans
Outputs
P2.1, P3.1, P4.1, P5.1, EM.7
3.1.12
P2
Plan Source
The development and establishment of courses of action over specied time periods that represent a projected appropriation of material resources to meet supply chain requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Asset Management Metric None Identied Plan Source Cycle Time, Order Fulllment Cycle Time None Identied Return on Supply Chain Fixed Assets, Return on Working Capital, Cash-To-Cash Cycle Time Cost to Plan Source Description/Denition Select suppliers with active EMS systems Processes to identify suppliers with good environmental records Bi-directional Digital Links (XML, EDI, etc) or Internet procurement networks to customer service linkage
Supply Chain Costs Best Practices Select suppliers with EMS Track supplier environmental records Distinct and Consistent Linkages Exist to Ensure Disruptions and Opportunities in Material Resources Are Quickly and Accurately Communicated and Acted Upon Joint Service Agreements with Suppliers Dene the Levels of Flexibility or Resource Upside Available Within Stated Lead Times and Agreed Upon Conditions All Key Participants in the Supply Chain, Including Strategic Partners, Have Full Visibility of the Demand/ Supply Plan Purchase environmentally friendly materials EDI Links Integrate Supplier Resource Information (Inventory, Capacity Availability, Etc.) with Own Resources
None identied
Supply Chain Event Management Systems
Purchase environmentally friendly materials Inter-company resource planning with EDI/Internet communication
3.1.13
P2
Production Plans P3.4 Delivery Plans P4.4 Planning Data EP.3 Supply Chain Plans P1.4 Item Master EP.7 Source Return Requirements P5.4 Order Signal D2.3, D3.3 Bill Of Materials EP.7 Product Routings EP.7
! P2.1 !
A
Product Requirements P2.3
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Product Availability Product On Order S1.1, S2.1, S3.3 Product Inventory Target Levels ES.4 Planning Data EP.3
! P2.2 !
A
Product Requirements P2.3
Planning Decision Policies EP.1 Product Requirements P2.1 Product Sources P2.2
! P2.3
P2.4 !
Sourcing Plans P1.2, P3.2, P4.2, P5.1, P5.2, ES.3, ES.4, S1.1, S2.1, S3.1, S3.3, D1.3, D2.3, D3.3, DR1.4, DR2.4, DR3.4
3.1.14
P2.1
Identify, Prioritize and Aggregate Product Requirements
The process of identifying, prioritizing, and considering, as a whole with constituent parts, all sources of demand for a product or service in the supply chain.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Master Production Scheduling Reects Management of Capacity and/or Supply Constraints Sales and Operations Agree to Limits of Short Term Flexibility The Demand Plan is Updated Frequently to Reect Actual Consumption or Customer Forecast Information Capacity and Supply Constraints Are Balanced Against Demand during the Planning Cycle Categorize 100% of Total Inventory (Active, Usable, Excess, Obsolete) for Appropriate Action Metric Forecast Accuracy Identify, Prioritize, and Aggregate Product Requirements Cycle Time None Identied Cost to Identify, Prioritize, and Aggregate Product Requirements None Identied Description/Denition None identied
None identied None identied
None identied
None identied
3.1.15
P2.1
Inputs
Production Plans P3.4 Delivery Plans P4.4 Planning Data EP.3 Supply Chain Plans P1.4 Item Master EP.7 Source Return Requirements P5.4 Order Signal D2.3, D3.3
> P2.1
> Product Requirements P2.3
Outputs
Bill Of Materials
EP.7 EP.7
Product Routings
3.1.16
P2.2
Identify, Assess and Aggregate Product Resources
The process of identifying, evaluating, and considering, as a whole with constituent parts, all material and other resources used to add value in the supply chain for a product or services.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Inventory Performance is Measured at the Dollar and Unit Levels Capacity and Supply Constraints Are Balanced Against Demand during the Planning Cycle Identify recyclable/reusable materials Identify green products Categorize 100% of Total Inventory (Active, Usable, Excess, Obsolete) for Appropriate Action Obsolete Inventory is Reviewed at the Part Number Level Minimize packaging Inventory is Planned at the Part Level, Based on Supply and Demand Variability Inventory targets Are Reviewed and Adjusted Frequently Metric None Identied Identify, Assess, and Aggregate Product Resources Cycle Time None Identied Cost to Identify, Assess, and Aggregate Product Resources None Identied Description/Denition None identied None identied
Identify recyclable/reusable materials Identify products that are manufactured to minimize environmental impacts None identied
None identied Work with suppliers to minimize packaging requirements and use reusable packaging material None identied
Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query inventory levels.
3.1.17
P2.2
Inputs
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Product Availability Product On Order S1.1, S2.1, S3.3 Product Inventory Target Levels ES.4 Planning Data EP.3
> P2.2
> Product Requirements

P2.3
Outputs
3.1.18
P2.3
Balance Product Resources with Product Requirements
The process of developing a time-phased course of action that commits resources to meet requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Suppliers Share Responsibility for Balancing Supply and Demand through Joint Service Agreements Metric None Identied Balance Product Resources with Product Requirements Cycle Time None Identied Cost to Balance Product Resources with Product Requirements None Identied Description/Denition None identied
Inputs
Planning Decision Policies EP.1 Product Requirements P2.1 Product Sources P2.2
> P2.3
> None IdentiOutputs ed
3.1.19
P2.4
Estabilsh Sourcing Plans
The establishment of courses of action over specied time periods that represent a projected appropriation of supply resources to meet sourcing plan requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Blanket Purchase Orders Cover Period Requirements Digital Linkage (EDI, XML, Etc.) is Used to Provide Real-Time Demand Information and Handle Routine Transactions Metric None Identied Establish Sourcing Plans Cycle Time None Identied Cost to Establish Sourcing Plans None Identied Description/Denition None identied None identied
Outputs Inputs
None Identi ed
> P2.4
>
Sourcing Plans P1.2, P3.2, P4.2, P5.1, P5.2, ES.3, ES.4, S1.1, S2.1, S3.1, S3.3, D1.3, D2.3, D3.3, DR1.4, DR2.4, DR3.4
3.1.20
P3
Plan Make
The development and establishment of courses of action over specied time periods that represent a projected appropriation of production resources to meet production requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Order Fulllment Cycle Time None Identied Energy Cost per Unit, Energy consumption Cash-To-Cash Cycle Time, Return on Working Capital, Return on Supply Chain Fixed Assets Description/Denition Multi-plant supply/demand planning and execution
Best Practices Distinct and Consistent Linkages Exist to Ensure that Disruptions and Opportunities in Production Are Quickly and Accurately Communicated and Responses Made Reduce Make environmental impacts
Identify processes that reduce environmental impacts of manufacturing
3.1.21
P3
Planning Data EP.3 Supply Chain Plans P1.4 Order Signal D2.3, D3.3 Delivery Plans P4.4 Item Master EP.7 Bill Of Materials EP.7 Product Routings EP.7 Return Production Requirements P3.1, P5.4
! P3.1 !
A
Return Production Requirements P3.1, P5.4
Equiptment and Facilities Replacement and Disposition Plans EM.5 Planning Data EP.3 Production Schedule M1.1, M2.1, M2.2. M3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Sourcing Plans P2.4
! P3.2 !
A
Production Resources P3.3
Planing Decision Policies EP.1 Production Resources P3.2 Production Requirements
! P3.3
P3.4 !
Production Plans P1.2, P2.1, P4.2, P5.1, P5.2, EM.1, EM.2, EM.5, M1.1, M1.5, M2.1, M2.5, M3.2, M3.6, D1.3, D2.3, D3.3
3.1.22
P3.1
Identify, Prioritize and Aggregate Production Requirements
The process of identifying, prioritizing, and considering as a whole with constituent parts, all sources of demand in the creation of a product or service.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consideration of Suppliers Material Availability in Companys Supply Resources (Including Suppliers Production Plans & Capability, Inventory, and Delivery Plans) Metric Forcast Accuracy Identify, Prioritize, and Aggregate Production Requirements Cycle Time None Identied Cost to Identify, Prioritize, and Aggregate Production Requirements None Identied Description/Denition Digital linkage to supplier quoting, planning, conguration and customer service applications
Inputs
Planning Data EP.3 Supply Chain Plans P1.4 Order Signal D2.3, D3.3 Delivery Plans P4.4 Item Master EP.7 Bill Of Materials EP.7 Product Routings EP.7 Return Production Requirements P3.1, P5.4
> P3.1
> Return Production Requirements

P3.1, P5.4
Outputs
3.1.23
P3.2
Identify, Assess and Aggregate Production Resources
The process of identifying, evaluating, and considering, as a whole with constituent parts, all things that add value in the creation of a product or performance of a service.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Obsolete Inventory is Reviewed at the Part Number Level Inventory targets Are Reviewed and Adjusted Frequently Consider environmental production constraints Metric None Identied Identify, Assess, and Aggregate Product Resources Cycle Time None Identied Cost to Identify, Assess, and Aggregate Production Resources None Identied Description/Denition None identied Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query inventory levels. Environmental constraints are considered as part of production capacity
Inputs
Equiptment and Facilities Replacement and Disposition Plans EM.5 Planning Data EP.3 Production Schedule M1.1, M2.1, M2.2. M3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Sourcing Plans P2.4
> P3.2
> Production Resources P3.3
Outputs
3.1.24
P3.3
Balance Production Resources with Production Requirements
The process of developing a time-phased course of action that commits creation and operation resources to meet creation and operation requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Balance environmental requirements Inventory targets Are Reviewed and Adjusted Frequently Metric None Identied Balance Production Resources with Production Requirements Cycle Time None Identied Cost to Balance Production Resources with Production Requirements None Identied Description/Denition Balance environmental requirements as well as supply/ demand requirements Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query inventory levels.
Inputs
Planing Decision Policies EP.1 Production Resources P3.2 Production Requirements
> P3.3
> None Identi ed
Outputs
3.1.25
P3.4
Establish Production Plans
The establishment of courses of action over specied time periods that represent a projected appropriation of supply resources to meet production and operating plan requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Minimize energy use Minimize Make emissions Unplanned Orders Are Accepted and Scheduled Only When There is No Detrimental Impact on Overall Product Delivery Plan Metric None Identied Establish Production Plans Cycle Time None Identied Cost to Establish Production Plans None Identied Description/Denition Plans are created to minimize energy use Plans are established to minimize emissions (e.g., release VOCs after dark) Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query production capacity and ATP and schedule unplanned orders.
Outputs Inputs
None Identi ed
> P3.4
> P1.2, P2.1, P4.2, P5.1, P5.2, EM.1, EM.2, EM.5, M1.1, M1.5, M2.1,
M2.5, M3.2, M3.6, D1.3, D2.3, D3.3
Production Plans
3.1.26
P4
Plan Deliver
The development and establishment of courses of action over specied time periods that represent a projected appropriation of delivery resources to meet delivery requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Order Fulllment Cycle Time None Identied Cost to Plan Deliver, Total Deliver Costs Return on Working Capital, Return on Supply Chain Fixed Assets, Cash-To-Cash Cycle Time Description/Denition Bi-directional Digital Links (XML, EDI, etc) or Internet procurement networks to customer service linkage
Best Practices Distinct and Consistent Linkages Exist to Ensure Disruptions and Opportunities in Material Resources Are Quickly and Accurately Communicated and Acted Upon Proactive Education of Customers to Set Expectations and Encourage Close Working Relationships (Knowledge of Long-Lead Items, Visibility to Supply Resources, Agreement on Levels of Flexibility) Minimize vehicle fuel use
None identied
Plan the use of high-eciency, low-emissions,or alternativefuel vehicles where possible
3.1.27
P4
Product/Category Lifecycle Store Shelf Inventory Counts D4.4 Planning Data EP.3 DC/Vendor Transit Time Order Backlog D1.11, D1.3, D2.3, D3.3 Year-to Year for Like SKU/Subclass Product Routings EP.7 Item Master EP.7 Service Levels EP.1 Markdown Plans DC/Vender Lead Time Promotion/Event Plans Actual Shrink Point of Sale Data (Daily) D4.6 Merchandise Category/Classi cation Supply Chain Plans P1.4 Delivery Return Requirements P5.4 Stock-out History EOQ/ESQs
! P4.1 !
A
Delivery Requirements P4.3 Item Stocking Requirements D4.2
Resource Availability D3.3 Planning Data EP.3 Load Information D1.5, D2.5, D3.5 Productin Plans P3.4 Sourcing Plans P2.4 Inventory Availability/Delivery Date D1.3, D2.3 Delivery Return Requirements P5.4 Finish Goods Inventory Target Levels SD.4
! P4.2 !
A
Delivery Resources and Capabilities P4.3
Planning Decision Policies EP.1 Delivery Resources and Capabilities P4.2 Delivery Requirements P4.1 Delivery Return Requirements P5.4
! P4.3
P4.4 !
Delivery Plans P1.2, P2.1, P3.1, P5.1, P5.2, M1.5, M2.5, M3.6, D1.3, D2.3, D3.3 Stocking Requirements D4.1
3.1.28
P4.1
Identify, Prioritize and Aggregate Delivery Requirements
The process of identifying, prioritizing, and considering, as a whole with constituent parts, all sources of demand in the delivery of a product or service.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric Forecast Accuracy Identify, Prioritize, and Aggregate Delivery Requirements Cycle Time None Identied Transportation Costs, Cost to Identify, Prioritize, and Aggregate Delivery Requirements None Identied Description/Denition Tightly integrated supply chain or demand planning with point of sale and customer inventory systems
Supply Chain Asset Management Best Practices Customer Relationship and Digital Linkages (XML, EDI, Etc.) Provide Accurate Visibility into Actual Demand via Customer Forecasts, Product Plans, Production Plans, and Inventory Positions Vendor Managed Inventory
VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Pilot by Wal-Mart. IT None identied Integrated Software Systems
Ideal Stock Position Based on Days/ Weeks of Supply Planogram Flexibility for Seasonal/ Promotional changes Electronic Matching Between POS Data and Store Inventory (Shelves and Back Room) Eliminate Special Deals Sales to Reduce Returns and Improve Forecast Accuracy (Reduces Uncertainty, Lowers Safety Stock Requirements, Cheaper to Administer) RFID and Other Tagging
None identied
POG software/eld force
3.1.29
P4.1
Unplanned Orders Are Accepted and Scheduled Only When There is No Detrimental Impact on Overall Product Delivery Plan Best Practices cont. Forecasts Are Replaced with Actual Customer Replenishment Signals and Orders Where Possible Matching Shelf Stock to Expectations Aggregate requirements Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query production capacity and ATP and schedule unplanned orders. Description/Denition cont. B2B Integration and Application Server Systems
A software based system that corrects shelf inventory levels based on actual product present (possible RFID solution). Identies stock-outs from shrinkage or item misplacement. Aggregate requirements to minimize transportation requirements
3.1.30
P4.1
Inputs
Product/Category Lifecycle Store Shelf Inventory Counts D4.4 Planning Data EP.3 DC/Vendor Transit Time Order Backlog D1.11, D1.3, D2.3, D3.3 Year-to Year for Like SKU/ Subclass Product Routings EP.7 Item Master EP.7 Service Levels EP.1 Markdown Plans DC/Vender Lead Time Promotion/Event Plans Actual Shrink Point of Sale Data (Daily) D4.6 Merchandise Category/ Classi cation Supply Chain Plans P1.4 Delivery Return Requirements P5.4 Stock-out History EOQ/ESQs
Outputs
> P4.1
>
Delivery Requirements P4.3 Item Stocking Requirements D4.2
3.1.31
P4.2
Identify, Assess and Aggregate Delivery Resources
The process of identifying, evaluating, and considering, as a whole with constituent parts, all things that add value in the delivery of a product or service.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Use reusable packaging Metric Forecast Accuracy Identify, Assess, and Aggregate Delivery Resources Cycle Time None Identied Cost to Identify, Assess, and Aggregate Delivery Resources None Identied Description/Denition Use reusable packaging where possible
Inputs
Resource Availability D3.3 Planning Data EP.3 Load Information D1.5, D2.5, D3.5 Productin Plans P3.4 Sourcing Plans P2.4 Inventory Availability/Delivery Date D1.3, D2.3 Delivery Return Requirements P5.4 Finish Goods Inventory Target Levels SD.4
Outputs
> P4.2
> Delivery Resources and Capabilities

P4.3
3.1.32
P4.3
Balance Delivery Resources and Capabilities with Delivery Requirements
The process of developing a time-phased course of action that commits delivery resources to meet delivery requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Demand Priorities Reecting Strategic Customer Relationships as Business Policies Are Automatically Followed in Allocating Resources; First-In-First-Out (FIFO) is Utilized as the Default Scheduling Priority Maximize loads, minimize runs Metric None Identied None Identied None Identied Transportation Costs, Cost to Identify, Assess, and Aggregate Delivery Resources None Identied Description/Denition Rules-based distribution planning system. Trading partner agreements
Maximize load size; minimize transportation runs
Inputs
Planning Decision Policies EP.1 Delivery Resources and Capabilities P4.2 Delivery Requirements P4.1
> P4.3
> None Identi ed
Inputs
3.1.33
P4.4
Establish Delivery Plans
The establishment of courses of action over specied time periods that represent a projected appropriation of delivery resources to meet delivery requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices To Address Conditions which Cannot be Adequately Satised During the Current Planning Period, Each Functional Area Develops Prioritized Recommendations for the Subsequent Planning Period Plans Which Do Not Violate Business Rules Are Communicated Openly and Cross-Functionally for Execution Specic Changes to the Plan Are Agreed to Cross-Functionally, According to Dened Business Rules Maximize loads, minimize runs Plans that Violate Business Rules (e.g. Joint Service Agreements) Are Addressed Cross-Functionally, Considering Total Business Impacts (Revenue, Cost, Quality, Customer Service, Etc.) Metric None Identied Establish Delivery Plans Cycle Time None Identied Distribution Costs, Cost to Establish Delivery Plans None Identied Description/Denition None identied
None identied
None identied
Maximize load size; minimize transportation runs None identied
Outputs Inputs
None Identi ed
> P4.4
>
Delivery Plans P1.2, P2.1, P3.1, P5.1, P5.2, M1.5, M2.5, M3.6, D1.3, D2.3, D3.3 Stocking Requirements D4.1
3.1.34
P5
Plan Return
A strategic or tactical process to establish and adjust courses of action or tasks over specied time periods that represent a projected appropriation of return resources and assets to meet anticipated as well as unanticipated return requirements. The scope includes unplanned returns of sold merchandise as well as planned returns of rotable products that are refurbished for reissue to customers.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Planning and Forecasting Outsourced Return process Use Demand Planning Metric None Identied Order Fulllment Cycle Time None Identied Cost to Plan Return None Identied Description/Denition Collaborative planning and forecasting with RETURN outsourcing partners (3PL, reverse drop shippers, etc.) Demand Planning Systems to forecast returns, predict yield rates for reusable products or components, determine demand in a resale market, and project a revenue stream.
3.1.35
P5
Product Routings EP.7 Item Master EP.7 Return Regulatory Requirements ER.8 Sourcing Plans P2.4 Historic Return Rates SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1 Business Rules for Return Processes ES.1, ER.1 Actual Sales History D1.2, D2.2, D3.3 Contractual Obligations Revised Business Assumptions EP.10, EP.5 Planning Data EP.3 Delivery Plans P4.4 Production Plans P3.4 Supply Chain Plans P1.4 Revised Aggregate Forecast and Projections EP.10 Return Regulatory Requirements ER.8 Regulatory Requirements EP.8 Inventory Strategy EP.4 Return Process Capabilities EP.2 MRO Product Return Capabilities ER.2, ER.5 Production Plans P3.4 Planning Data EP.3 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Outsource Plan EP.5, EP.6 Return Process Work ow De niton and Policies ER.7 Budget Constraints EP.10 Return Inventory Targets ER.4 Return Transportation Guidelines, Policies and Agreements Data About Return Capabilities ER.3 Make/Buy Decision EP.5 Projected Internal and External Capacity EP.5, EP.6 Delivery Plans P4.4 Sourcing Plans P2.4 Business Rules for Return Processes ES.1, ER.1 Revised Capital Plan EP.5, EP.6
! P5.1 !
A
Return Requirements P5.3 Item Stocking Requirements D4.2
! P5.2 !
A
Return Resources P5.3 Item Stocking Requirements D4.2
Return Resources P5.2 Return Requirements P5.1 Planning Decision Policies EP.1 Supply Chain Performance Improvement Plan EP.2
! P5.3
P5.4 !
Product Return Capabilities DR1.1, DR2.1, DR3.1 Return Plans SR1.2, SR2.2, SR3.2,DR1.1. DR2.1, DR3.1, ER.4, ER.5, ER.6, ER.7 Process Procedures ER.1, ER.2, ER.8 Deliver Return Requirements P4.1, P4.2 Source Return Requirements P2.1 Return Rules and Policies ER.1 Return Production Requirements P3.1
3.1.36
P5.1
Assess and Aggregate Return Requirements
The process of identifying, evaluating, and considering, as a whole with constituent parts, all sources of demand for the return of a product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Use Historical Based Return Rate Forecasts Identify take-back programs Identify items to return Real Time Return Anticipation Metric None Identied Identify, Prioritize, and Aggregate Return Requirements Cycle Time None Identied Cost to Identify, Prioritize, and Aggregate Return Requirements None Identied Description/Denition None identied Identify products in take-back programs that are near end of life Identify MRO items that will need planned maintenance during the planning horizon Having real time data on return demand and including it in the plan and forecast. Requires a connection with customers, call centers or CRM system, possibly to the store level with retail returns. The return demand needs to be included in the production plan as soon as possible because upon repair it may be the next piece of serviceable inventory to satisfy demand.
3.1.37
P5.1
Inputs
Product Routings EP.7 Item Master EP.7 Return Regulatory Requirements ER.8 Sourcing Plans P2.4 Historic Return Rates SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1 Business Rules for Return Processes ES.1, ER.1 Actual Sales History D1.2, D2.2, D3.3 Contractual Obligations Revised Business Assumptions EP.10, EP.5 Planning Data EP.3 Delivery Plans P4.4 Production Plans P3.4 Supply Chain Plans P1.4
> P5.1
> Return Requirements P5.3
Outputs
3.1.38
P5.2
Identify, Assess, and Aggregate Return Resources
The process of identifying, evaluating, and consideration for all resources that add value to, execute, or constrain the processes for the return of a product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Allow Source Suppliers Full Visibility into the Current Return Situations and the Forecasted Return Activity Joint Service Agreements with Source Suppliers to Share Responsibilities and Costs of Returns Rapid Reconguration of Return Capacity Metric None Identied Balance Return Resources with Return Requirements Cycle Time None Identied Cost to Identify, Assess, and Aggregate Return Resources None Identied Description/Denition Shared supply chain forecasting and event management functionality with Source suppliers Collaborative planning tools with the Source suppliers
Use of RETURN tracking and projection systems and exible partner agreements that allow the rapid addition of RETURN capacity to match unexpected demand.
3.1.39
P5.2
Inputs
Return Regulatory Requirements ER.8 Regulatory Requirements EP.8 Inventory Strategy EP.4 Return Process Capabilities EP.2 MRO Product Return Capabilities ER.2, ER.5 Production Plans P3.4 Planning Data EP.3 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Outsource Plan EP.5, EP.6 Return Process Work ow De niton and Policies ER.7 Budget Constraints EP.10 Return Inventory Targets ER.4 Return Transportation Guidelines, Policies and Agreements Data About Return Capabilities ER.3 Make/Buy Decision EP.5 Projected Internal and External Capacity EP.5, EP.6 Delivery Plans P4.4 Sourcing Plans P2.4 Business Rules for Return Processes ES.1, ER.1 Revised Capital Plan EP.5, EP.6
> P5.2
> Return Resources P5.3
Outputs
3.1.40
P5.3
Balance Return Resources with Return Requirements
The process of developing courses of action that make feasible the commitment the appropriate return resources and or assets to satisfy return requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Advance Planning Engines Applied to Returns Cost Accounting System to Determine the Best Return Process to Follow from a Cost of Business Perspective Dynamic Return Restocking Management Metric None Identied Balance Return Resources with Return Requirements Cycle Time None Identied Cost to Identify, Assess, and Aggregate Return Resources None Identied Description/Denition Advanced math model solvers that optimize / minimize constraints, routing, restocking priorities and costs. ABC costing system
Dynamic prioritization of restocking plans in order to rapidly re-sell products that are in demand thus reducing new inventory demand.
Inputs
Return Resources P5.2 Return Requirements P5.1 Planning Decision Policies EP.1 Supply Chain Performance Improvement Plan EP.2
> P5.3
> None Identi ed
Outputs
3.1.41
P5.4
Establish and Communicate Return Plans
The establishment and communication of courses of action over specied time periods that represent a projected appropriation of required return resources and or assets to meet return process requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Rapid, Dynamic Reconguration of Return Process to Meet Demand Metric None Identied Establish and Communicate Return Plans Cycle Time None Identied Cost to Establish and Communicate Return Plans None Identied Description/Denition The ability to reset and recongure the RETURN process capacity, routings, etc. by transmitting new requirements and directives using mathematical models, the Internet, outsourcing and exible partnership agreements. Also requires integration with the CRM system for real time redirection of customer returns based upon cost and capacity. Intranet and Extranet communications tools
Full Internal (And External If Source Suppliers Share in the Return Process Responsibilities) Visibility to Return Plans
Outputs
Product Return Capabilities DR1.1, DR2.1, DR3.1 Return Plans SR1.2, SR2.2, SR3.2,DR1.1. DR2.1, DR3.1, ER.4, ER.5, ER.6, ER.7
Inputs
None Identi ed
> P5.4
> Deliver Return Requirements P4.1, P4.2

Source Return Requirements P2.1 Return Rules and Policies ER.1 Return Production Requirements P3.1
Process Procedures ER.1, ER.2, ER.8
3.1.42
EP
Enable Plan
The collection of processes associated with managing and monitoring Plan process data, performance and relationships.
Process Categories EP.1: Manage Business Rules for Plan Processes The process of establishing, maintaining, and enforcing decision support criteria for Supply Chain Planning which translate to rules for conducting business, i.e. developing and maintaining customer and channel performance standards of an entire supply chain such as service levels, given service requirements by supply chain stakeholders/trading partners. Business rules align PLAN process policies with business strategy, goals, and objectives. The process of measuring actual integrated Supply Chain performance against internal and/or external standards to develop and implement a course of action to achieve targeted performance levels. Performance targets established for the execution of supply chain processes are reected in the process elements for PLAN, i.e. cost, delivery reliability, cycle time, responsiveness, and assets. The process of collecting, integrating and maintaining the accuracy of supply chain execution information necessary to plan the balance of supply chain resources to demand requirements at both the highest aggregate and lowest SKU planning levels. Each occurrence consumes time The process of establishing total supply chain inventory strategy and planning the total inventory limits or levels (including Raw Material, Work In Process, Finished and Purchased Finished Goods) including replenishment models, ownership, product mix, and stocking locations, both inter and intra company. The process of dening capacity strategy (i.e. internal versus contract manufacturing or internal versus 3rd Party Logistics) and then acquiring, maintaining and dispositioning an organizations capital assets to operate the integrated supply chain. The process of dening an integrated supply chain transportation strategy and maintaining the information which characterizes total supply chain transportation requirements, and the management of transporters both inter and intra company.
EP.5: Manage Integrated Supply Chain Capital Assets
EP.6: Manage Integrated Supply Chain Transportation
3.1.43
EP
EP.7: Manage Planning Conguration The process of dening and maintaining the information about a unique supply chain network for a group of similar or complimentary products through their full life cycle, including the evaluation of market need, product realization (development, introduction and production), product discontinuation, and after-market support. This element also includes the management of critical sub processes needed to manage the life cycle of individual item numbers including item masters, routings, event planning (promotions, etc.), ABC classication, rationalization, and bill of materials. The process of identifying and complying with regulatory documentation and process standards set by external entities (i.e. government, trade ocials, etc.) when planning for the integrated supply chain network. The process of identifying, coordinating and managing Supply Chain Risk(s) by aligning with the overall business risk management program. Supply Chain Risk is dened as any uncertainty that can aect the organization in a potentially negative fashion. The Manage Supply Chain Plan Risk enabler includes identifying the potential risk, assessing the probabality and potential impact of the risk, and planning risk mitigating strategies. The process of revising the long-term supply chain capacity and resource plans, given the inputs from the strategic and business plans. This includes revision of not only aggregate forecast and projections related to supply chain, source, make, and delivery plans, but also business assumptions.
EP.9: Manage Supply Chain Plan Risk
3.1.44
EP
Strategic Plan Service Requirements Business Plan
! ! ! ! ! !
EP.1 ! EP.2
!
Service Levels P4.1 Planning Decision Policies P4.1, EP.4, EP.5, EP.6, P1.3, P2.3, P3.3, P4.3, P5.3, ED.1
Supply Chain Performance Metrics ES.4, EM.2, ED.2, ER.2 Continuous Improvement Process Business Plan
Return Process Capabilities P5.2 Supply Chain Performance Improvement Plan P1.3, P5.3
Supply Chain Execution Data
EP.3 ! EP.4 ! EP.5 ! EP.6 ! EP.7

!
Planning Data P1.1, P1.2, P2.1, P2.2, P3.1, P3.2, P4.1, P4.2, P5.1, P5.2, EM.7
Product Routings EP.7 Integrated Supply Chain Inventory Information EP.4 Planning Decision Policies EP.1 Capacity Constraints
Integrated Supply Chain Inventory Information EP.4 Inventory Strategy P1.3, P5.2
Product Routings EP.7 Planning Decision Policies EP.1 Capacity Constraints
Revised Business Assumptions P1.1, P5.1, ED.7 Make/Buy Decision P1.2, P5.2 Projected Internal and External Capacity P5.2 Revised Capital Plan P1.2, P5.2 Production Capacity EM.1, EM.2 Outsource Plan P1.2, P5.2
Product Routings EP.7 Planning Decision Policies EP.1
Make/Buy Decision P1.2, P5.2 Projected Internal and External Capacity P5.2 Revised Capital Plan P1.2, P5.2 Outsource Plan P1.2, P5.2 Transportation Capacity EM.1, EM.3
Item Master P2.1, P3.1, P4.1, P5.1 Product Routings EP.4, EP.5, EP.6, P2.1, P3.1, P4.1, P5.1 Bill of Materials P2.1, P3.1
EP.8 !
Internal Information Monitoring
Regulatory Requirements P5.2
EP.9 !
Risk Management Program for Process Area Internal Adjustments
Strategic Plan Business Plan
!EP.10 !
Revised Business Assumptions P1.1, P5.1, ED.7 Revised Aggregate Forecast and Projections P1.1, P5.1 Budget Constraints P5.2
3.1.45
EP.1
Manage Business Rules for Plan Process
The process of establishing, maintaining, and enforcing decision support criteria for Supply Chain Planning which translate to rules for conducting business, i.e. developing and maintaining customer and channel performance standards of an entire supply chain such as service levels, given service requirements by supply chain stakeholders/trading partners. Business rules align PLAN process policies with business strategy, goals, and objectives.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Integrated Business and SupplyChain Planning Processes Where Cross-Functional Input is Leveraged to Set Business Rules Metric None Identied Manage Business Rules for Return Processes Cycle Time None Identied Cost to Manage Business Rules for PLAN Processes None Identied Description/Denition Supply Chain performance dashboard capability.
Inputs
Strategic Plan Service Requirements Business Plan
Outputs
> EP.1
> Planning Decision Policies
Service Levels P4.1
EP.4, EP.5, EP.6, P1.3, P2.3, P3.3, P4.3, P5.3
3.1.46
EP.2
Manage Performance of Supply Chain
The process of measuring actual integrated Supply Chain performance against internal and/or external standards to develop and implement a course of action to achieve targeted performance levels. Performance targets established for the execution of supply chain processes are reected in the process elements for PLAN, i.e. cost, delivery reliability, cycle time, responsiveness, and assets.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Ecient and Eective Benchmarking Process Leveraging Cross Industry Metrics and Denitions Sound Project Management Process and Methodology Reliable Continuous Improvement Process and Methodology. Manage environmental performance Metric None Identied Manage Performance of Supply Chain Cycle Time None Identied Cost to Manage Performance of Supply Chain None Identied Description/Denition None identied
None identied None identied Manage environmental performance of the supply chain.
Inputs
Supply Chain Performance Metrics ES.4, EM.2, ED.2, ER.2 Continuous Improvement Process Business Plan
Outputs
> EP.2
> Supply Chain Performance

Improvement Plan P1.3, P5.3
Return Process Capabilities P5.2
3.1.47
EP.3
Manage PLAN Data Collection
The process of collecting, integrating and maintaining the accuracy of supply chain execution information necessary to plan the balance of supply chain resources to demand requirements at both the highest aggregate and lowest SKU planning levels. Each occurrence consumes time.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Integrated Demand and Supply Planning - Demand Planning, Supply Planning and especially the Supply Plan Execution Are no longer disconnected. All required planning and execution data is integrated and shared in between all functional areas within an orga Single Data Source for Decision Support and Business Rules Metric None Identied Manage PLAN Data Collection Cycle Time None Identied Cost to Manage PLAN Data Collection None Identied Description/Denition Memory based planning systems provide one single data model and data mart (including the business rules) for the entire supply chain planning and execution process. Algorithms use the business rules as the driver for the planning engine.
A data warehouse/data mart is the source of all planning (master) data, business rules and transaction data. Analyzing tools enable the ongoing maintenance and improvement of the business rules based on actual data.
Inputs
Outputs
> EP.3
> Planning Data P2.2, P3.1, P3.2, P1.1, P1.2, P2.1,

P4.1, P4.2, P5.1, P5.2, EM.7
3.1.48
EP.4
Manage Integrated Supply Chain Inventory
The process of establishing total supply chain inventory strategy and planning the total inventory limits or levels (including Raw Material, Work In Process, Finished and Purchased Finished Goods) including replenishment models, ownership, product mix, and stocking locations, both inter and intra company.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Capability to Run Multiple Simulated Full-Stream Supply/ Demand Balancing Against LongTerm Capacity Plans and Scenarios Metric Forecast Accuracy Manage Integrated Supply Chain Inventory Cycle Time None Identied Cost to Manage Integrated Supply Chain Inventory None Identied Description/Denition Supply Chain modeling capabilities, i.e. Advanced Planning Systems.
Inputs
Product Routings EP.7 Integrated Supply Chain Inventory Information EP.4 Planning Decision Policies EP.1 Capacity Constraints Sourcing Plans P2.4
Outputs
> EP.4
>
Integrated Supply Chain Inventory Information EP.4 Inventory Strategy P1.3, P5.2
3.1.49
EP.5
Manage Integrated Supply Chain Capital Assets
The process of dening capacity strategy (i.e. internal versus contract manufacturing or internal versus 3rd Party Logistics) and then acquiring, maintaining and dispositioning an organizations capital assets to operate the integrated supply chain.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Alignment of Strategic and Business Plans with Long-Term Capacity and Resource Planning Use of Cross Functional Teams to Execute the Process of Developing Long-Term Capacity and Resource Plans Factor environmental considerations into planning Capability to Run Multiple Simulated Full-Stream Supply/ Demand Balancing Against LongTerm Capacity Plans and Scenarios Metric Forecast Accuracy Manage Integrated Supply Chain Capital Assets Cycle Time None Identied Cost to Manage Integrated Supply Chain Capital Assets None Identied Description/Denition None identied
None identied
Factor environmental considerations/restrictions into capacity planning Supply Chain modeling capabilities, i.e. Advanced Planning Systems.
Outputs
Revised Business Assumptions P1.1, P5.1, ED.7
Inputs
Make/Buy Decision P1.2, P5.2
> EP.5
>
Projected Internal and External Capacity P5.2 Revised Capital Plan P1.2, P5.2 Production Capacity EM.1, EM.2 Outsource Plan P1.2, P5.2
3.1.50
EP.6
Manage Integrated Supply Chain Transportation
The process of dening an integrated supply chain transportation strategy and maintaining the information which characterizes total supply chain transportation requirements, and the management of transporters both inter and intra company.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Considerations emissions in transportation decisions Alignment of Strategic and Business Plans with Long-Term Capacity and Resource Planning Capability to Run Simulated FullStream Supply/Demand Balancing for What-If Scenarios Use of Cross Functional Teams to Execute the Process of Developing Long-Term Capacity and Resource Plans Metric Forecast Accuracy Manage Integrated Supply Chain Transportation Cycle Time None Identied Cost to Manage Integrated Supply Chain Transportation None Identied Description/Denition Integrate environmental emissions considerations to transportation decisions. Feature: Implement Environmental Management System None identied
Supply chain modeling and visualization system
None identied
Outputs
Make/Buy Decision P1.2, P5.2
Inputs
> EP.6
> Revised Capital Plan P1.2, P5.2

Outsource Plan P1.2, P5.2
Projected Internal and External Capacity P5.2
Transportation Capacity EM.1, EM.2
3.1.51
EP.7
Manage Planning Conguration
The process of dening and maintaining the information about a unique supply chain network for a group of similar or complimentary products through their full life cycle, including the evaluation of market need, product realization (development, introduction and production), product discontinuation, and after-market support. This element also includes the management of critical sub processes needed to manage the life cycle of individual item numbers including item masters, routings, event planning (promotions, etc.), ABC classication, rationalization, and bill of materials.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices New Items Introductions Are part of the Sales and Operations Planning Process at the General Management Business Team Level Use of Platform Teams in the New Product Development Process Incorporates leading practices such as Ecient Consumer Response, Collaborative Planning, Forecasting, and Replenishment, Vendor Managed Inventory, and real time point of consumption reporting. SKU Rationalization ABC Classication Material content classication Metric Forecast Accuracy Manage Planning Conguration Cycle Time None Identied Cost to Manage Planning Conguration None Identied Description/Denition None identied
None identied None Identied
None identied None identied Material content classication (HAZMAT recycleable, etc.)
Outputs
Item Master P2.1, P3.1, P4.1, P5.1
Inputs
None Identi ed
> EP.7
> Product RoutingsP3.1, P4.1, EP.4, EP.5, EP.6, P2.1,

P5.1
Bill of Materials
P2.1, P3.1
3.1.52
EP.8
Manage PLAN Regulatory Requirements and Compliance
The process of identifying and complying with regulatory documentation and process standards set by external entities (i.e. government, trade ocials, etc.) when planning for the integrated supply chain network.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric Number of notices of violation received Supply chain down time due to compliance issues None Identied Environmental Compliance Cost, Cost to Manage Plan Regulatory Requirements and Compliance, Environmental non-compliance cost None Identied Description/Denition Determine supplier environmental compliance performance/ Actively participate in regulation development Implement an Environmental Management System (EMS) to track and manage environmental performance and to track performance against regulatory requirements
Supply Chain Asset Management Best Practices Monitor supplier environmental compliance Environmental Management System (EMS)
Inputs
None Identi ed
> EP.8
> Regulatory Requirements P5.2
Outputs
3.1.53
EP.9
Process Element: Manage Supply Chain Plan Risk
The process of identifying, coordinating and managing Supply Chain Risk(s) by aligning with the overall business risk management program. Supply Chain Risk is dened as any uncertainty that can aect the organization in a potentially negative fashion. The Manage Supply Chain Plan Risk enabler includes identifying the potential risk, assessing the probability and potential impact of the risk, and planning risk mitigating strategies. This requires analysis and coordination with the assessment and mitigating activities of the other process areas (S, M, D, R) as it relates to Supply side, Demand side, Internal, and External Supply Chain Risks.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric None Identied None Identied Industry Benchmark Comparison (%), Options Rating (0-100%), Hedge Rating (Inventory DOS for risk management) Assessment / Risk Management Costs ($), Mitigation Cost ($), Mitigation cost by Event ($) Residual Risk ($), Mitigated Risk ($), Individual Process Area Event Rating (EVAR) ($), Supply / Customer / Product Base Rated (%), Event Risk (EVAR) ($), Gross Risk ($) Description/Denition This practice relies on a risk evaluation of the supply chain to guide the design of the supply chain network. Node locations, transportation routes, capacity size and location, number of suppliers, number of production locations, etc. are all determined in a fashion that mitigates potential disruptions to the ability to deliver product and service to the end customer. This practice relies on the information collected through risk identication and risk assessment processes to identify nodes that are at a high risk of disruption due to the location of the node. Location specic risks can include tactical strike risks, natural disaster risks, single point of failure risks, etc.
Supply Chain Costs
Supply Chain Asset Management
Best Practices Supply Chain Network Congured to Mitigate Risk
3.1.54
EP.9
Best Practices cont. Supply Chain Business Rules Congured to mitigate risk Description/Denition cont. This practice involves establishing business rules (e.g., customer priority, supplier priority, production routing, transportation routing, etc.) based on minimizing the risk to the supply chain. Under this practice, business rules are established or congured in response to the corporate risk management plan with a goal of reducing either the likelihood of a disruption occurring or the impact to the supply chain should a disruption occur. Business rule reconguration typically includes an assessment of the impact of each rule change on the overall supply chain before actual implementation. Supply Chain Risk Identication A key aspect of supply chain risk management is identication. Identication involves creating a list of potential events that could harm any aspect of the supply chains performance. Risk identication allows an organization to take steps to create plans to manage risks before they occur. this is typically more cost eective then waiting to react to adverse events when they occur. This practice involves managing supply chain information networks to minimize the risk to the supply chain. This includes information sharing with partners as well as internal locations. This helps all parties to be quickly informed of a real or potential disruption and respond quickly and appropriately to minimize the disruption impact. Supply Chain Risk assessment provides management with an understanding of where the greatest risks may exist in order to prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of the risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events. the team can then prioritize addressing the risks. Supply chain risk management is the systematic identication, assessment and mitigation of potential disruptions in logistics networks with the objective to reduce their negative impact on the logistics networks performance. Once areas of risk have been identied, an organization needs to monitor their internal and external environment. This helps them to predict when risky events are becoming more likely. It also helps to identify new risks and is tightly linked to the best practice of Supply Chain Risk Identication.
Supply Chain Information Congured to Minimize Risk
Supply Chain Risk Assessment
Supply Chain Risk Management
Supply Chain Risk Monitoring
3.1.55
EP.9
Best Practices cont. Crisis Communications Planning Description/Denition cont. Open communication is necessary for eective risk management, where the term open refers to the possibility to directly reach the right person who can better handle the information about a crisis situations wherever in the organization. Managers require direct communication channels up, down and across their business units to help identify risks and take appropriate actions.
Inputs
Outputs
> EP.9
> Risk Management Program for Process Area

Internal Adjustments
3.1.56
EP.10
Align Supply Chain Unit Plan with Financial Plan
The process of revising the long-term supply chain capacity and resource plans, given the inputs from the strategic and business plans. This includes revision of not only aggregate forecast and projections related to supply chain, source, make, and delivery plans, but also business assumptions.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Re-Planning Process Links the Supply Chain Operation with the Business Strategy and the Marketing Strategy Re-Planning Process Exists in Multi-Levels of the Supply-Chain between Business Enterprises Strategic Sales and Operations Planning Process in Place and Managed at the Executive Level Metric None Identied Align Supply Chain Unit Plan with Financial Plan Cycle Time None Identied Cost to Align Supply Chain Unit Plan with Financial Plan None Identied Description/Denition None identied
Business to business Internet capability to share common data. None identied
Outputs
Inputs
Strategic Plan Business Plan
Revised Business Assumptions P1.1, P5.1, ED.7
> EP.10
> Revised Aggregate Forecast and Projections

P1.1, P5.1 Budget Constraints P5.2
3.1.57
3.1.58
S
Source
The processes associated with ordering, delivery, receipt and transfer of raw material items, subassemblies, product and/or services.
Process Categories S1: Source Stocked Product The process of ordering, receiving and transferring raw material items, sub-assemblies, product and or services based on aggregated demand requirements. The intention of Source-to-Stock is to maintain a predetermined level of inventory for these materials, sub-assemblies or products. No customer reference or customer order detail is exchanged with the supplier, attached to or marked on the product, or recorded in the warehousing or ERP system for Source-to-Stock products. Examples of alternative or related names for Source-to-Stock are: replenishment inventory, drip parts, kan-ban, andon, and bulk or generic stock. The processes of ordering and receiving product or material that is ordered (and may be congured) only when required by a specic customer order. The intention of Source-to-Order is to maintain inventory ordered (and/or congured) specically for customer orders only. The product is ordered, received and identied in stock using this customer order reference (order designated inventory). The product is typically identiable throughout the sourcing process, by the reference to the customer order attached to or marked on the product or packaging and in the warehouse management or ERP system. Examples of alternative or related names for Source-to-Order are: purchase-to-order, special ordering (retail industry), kitting and line sequencing (manufacturing industries). The processes of identifying and selecting sources of supply, negotiating, validating, scheduling, ordering and receiving parts, assemblies or specialized products or services that are designed, ordered and/or built based on the requirements or specications of a specic customer order. The collection of processes associated with managing and monitoring Source process data, performance and relationships
S2: Source Make-to-Order Product
S3: Source Engineer-toOrder Product
ES: Enable Source
3.2.1
S1
Source Stocked Product
The process of ordering, receiving and transferring raw material items, sub-assemblies, product and or services based on aggregated demand requirements. The intention of Source-to-Stock is to maintain a pre-determined level of inventory for these materials, subassemblies or products. No customer reference or customer order detail is exchanged with the supplier, attached to or marked on the product, or recorded in the warehousing or ERP system for Source-to-Stock products. Examples of alternative or related names for Sourceto-Stock are: replenishment inventory, drip parts, kan-ban, andon, and bulk or generic stock.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Source Cycle Time, Order Fulllment Cycle Time None Identied Cost to Source, Product Acquisition Costs Return on Supply Chain Fixed Assets, Return on Working Capital, Inventory Days of Supply (Raw Material) Description/Denition Select suppliers with active EMS systems Collaborative Planning Systems Utilize green purchasing practices
Best Practices Select suppliers with EMS Joint Service Agreements (JSA) Utilize green purchasing practices
3.2.2
S1
Sourcing Plans P2.4 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Supplier Performance ES.2 Logistics Selection ES.6 Production Schedule M1.1, M2.1, M2.2, M3.2
! S1.1 !
Product On Order P2.2, ES.10 Scheduled Receipts S1.2, S3.4, M1.1, M2.1, M3.2, D1.8, D4.2 Procurement Signal (Supplier)
MRO Products DR2.4 Product D1.13, D2.13, D3.13 Defective Products DR1.4 Scheduled Receipts S1.1, S2.1, S3.3 Excess Products DR3.4 Production Schedule M1.1, M2.1, M2.2, M3.2 Return Production uirements P3.1, P5.4 Product Routings EP.7
! S1.2 !
Receipt Verication ES.1, ES.2, ES.6, ES.8, S1.3, S1.4, S2.3, S2.4, S3.5, S3.6, ED.8
Receipt Verication S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
! S1.3 !
Product Inventory Location ES.4 Finished Goods Inventory Location ED.4 Receipt Verication S1.2, S1.3, S2.2, S2.3, S3.4, S3.5 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 WIP Inventory Location EM.6
! S1.4 !
Exising Inventory Data ES.4, ED.4 Loaded Retail Cart or Pallet D4.4 Transferred Product S1.5, S2.5, S3.7 Inventory Availability P2.2, P3.2, ES.4, M1.2, M2.2, M3.3, D1.3, D1.8, D1.9, D2.3, D2.9, D3.9, D4.2, D4.3 Daily Replenishment Requirements D4.1
Transferred Product S1.4, S2.4, S3.6 Payment Terms ES.10
! S1.5
3.2.3
S1.1
Schedule Product Deliveries
Scheduling and managing the execution of the individual deliveries of product against an existing contract or purchase order. The requirements for product releases are determined based on the detailed sourcing plan or other types of product pull signals.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Metric % Schedules Changed within Suppliers Lead Time Average Release Cycle of Changes, Average Days per Engineering Change, Schedule Product Deliveries Cycle Time, Average Days per Schedule Change None Identied Cost to Schedule Product Deliveries, Quantity per shipment None Identied Description/Denition Bundle deliveries of dierent products into single shipment when possible Minimize need for frequent shipments by accurately determining product needs Electronic Kanban support
Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Bundle deliveries Infrequent product delivery Mechanical (Kanban) Pull Signals Are Used to Notify Suppliers of the Need to Deliver Product Supplier managed inventories with scheduling interfaces to external supplier systems Utilize EDI Transactions to Reduce Cycle Time and Costs Advanced Ship Notices Allow for Tight Synchronization between Source and Make Processes Consignment Agreements Are Used to Reduce Assets and Cycle Time While Increasing the Availability of Critical Items
VMI agreements allow suppliers to manage (replenish) inventory EDI interface for 830, 850, 856 & 862 transactions Blanket order support with scheduling interfaces to external supplier systems Consignment inventory management
3.2.4
S1.1
Inputs
Sourcing Plans P2.4 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Supplier Performance ES.2 Logistics Selection ES.6 Production Schedule M1.1, M2.1, M2.2, M3.2
Outputs
> S1.1
> Scheduled Receipts
Product On Order P2.2, ES.10
S1.2, S3.4, M1.1, M2.1, M3.2, D1.8, D4.2 Procurement Signal (Supplier)
3.2.5
S1.2
Receive Product
The process and associated activities of receiving product to contract requirements.
Performance Attributes Supply Chain Reliability Metric % Orders/ Lines Processed Complete, % Orders/ Lines Received On-Time To Demand Requirement, % Orders/ Lines Received with Correct Shipping Documents, % Orders/ lines received with correct packaging Receiving Product Cycle Time None Identied Cost to Receive Product None Identied Description/Denition None identied
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Deliveries Are Balanced Throughout Each Working Day and Throughout the Week Vendor Managed Inventory
VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Electronic Tag tracking to Point of Use (POU) destination Bar code interface for data collection devices. Generate bar coded receiving documents. Product serial number used as identier. RFID Skip lot/sampling inspection logic
Supplier Delivers Directly to Point of Use Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection Carrier Agreement
Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions.
3.2.6
S1.2
Inputs
MRO Products DR2.4 Product D1.13, D2.13, D3.13 Defective Products DR1.4 Scheduled Receipts S1.1, S2.1, S3.3 Excess Products DR3.4
> S1.2
> Receipt Verication S1.4, ES.1, ES.2, ES.6, ES.8,S1.3,

S2.3, S2.4, S3.5, S3.6
Outputs
3.2.7
S1.3
Verify Product
The process and actions required determining product conformance to requirements and criteria.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Supplier Replaces Defective Material at Customers Facility with Good Product as Required Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection Monitor product compliance Deliveries Are Balanced Throughout Each Working Day and Throughout the Week Supplier Delivers Directly to Point of Use Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Metric % Orders/ Lines Received Defect Free, % Orders/ lines received with correct content Verify Product Cycle Time None Identied Cost to Verify Product None Identied Description/Denition Electronic Tag tracking to Point of Use (POU) destination
Skip lot/sampling inspection logic
Review product for compliance with environmental specications, including product packaging None identied
Electronic Tag tracking to Point of Use (POU) destination Bar code interface for data collection devices Generate bar coded receiving documents Product serial number used as identier. RFID
Inputs
Receipt Veri cation S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
> S1.3
> Receipt Veri cation
Outputs
S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
3.2.8
S1.4
Transfer Product
The transfer of accepted product to the appropriate stocking location within the supply chain. This includes all of the activities associated with repackaging, staging, transferring and stocking product. For service this is the transfer or application of service to the nal customer or end user.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric % Product Transferred On-Time to Demand Requirement, % Product Transferred without Transaction Errors Transfer Product Cycle Time None Identied Energy Costs, Cost to Transfer Product, Product Packaging costs, % of vehicle fuel derived from alternative fuels, Packaging purchases, Quantity per shipment Inventory Days of Supply Description/Denition Pay on receipt. Specify delivery location and time (to the minute).Specify delivery sequence Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Utilize alternative fuel vehicles Utilize high fuel eciency vehicles None identied
Supply Chain Asset Management Best Practices Drive Deliveries Directly to Stock or Point-Of-Use in Manufacturing to Reduce Costs and Cycle Time Implement pollution prevention program Utilize alternative fuel vehicles Utilize high eciency vehicles Capability Transfer to Organization
3.2.9
S1.4
Outputs Inputs
Product Inventory Location ES.4 Finished Goods Inventory Location ED.4 Receipt Veri cation S1.2, S1.3, S2.2, S2.3, S3.4, S3.5 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Exising Inventory Data ES.4, ED.4 Loaded Retail Cart or Pallet D4.4
> S1.4
> Inventory Availability

Daily Replenishment Requirements D4.1
Transferred Product S1.5, S2.5, S3.7
P2.2, P3.2, ES.4, M1.2, M2.2, M3.3, D1.3, D1.8, D1.9, D2.3, D2.9, D3.9, D4.2, D4.3
3.2.10
S1.5
Authorize Supplier Payment
The process of authorizing payments and paying suppliers for product or services. This process includes invoice collection, invoice matching and the issuance of checks.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Pay on Receipt Metric None Identied Authorize Supplier Payment Cycle Time None Identied Cost to Authorize Supplier Payment None Identied Description/Denition Electronic Invoice Processing
Inputs
> S1.5
3.2.11
S2
Source Make-to-Order Product
The processes of ordering and receiving product or material that is ordered (and may be congured) only when required by a specic customer order. The intention of Source-toOrder is to maintain inventory ordered (and/or congured) specically for customer orders only. The product is ordered, received and identied in stock using this customer order reference (order designated inventory). The product is typically identiable throughout the sourcing process, by the reference to the customer order attached to or marked on the product or packaging and in the warehouse management or ERP system. Examples of alternative or related names for Source-to-Order are: purchase-to-order, special ordering (retail industry), kitting and line sequencing (manufacturing industries).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric Perfect Order Fulllment Order Fulllment Cycle Time, Source Cycle Time None Identied Product Acquisition Costs, Cost to Source Inventory Days of Supply (Raw Material), Return on Working Capital, Return on Supply Chain Fixed Assets Description/Denition Collaborative Planning Systems Select suppliers with active EMS systems None identied Utilize green purchasing practices
Best Practices Joint Service Agreements (JSA) Select suppliers with EMS Automated Statistical Process Control (SPC) Utilize green purchasing practices
3.2.12
S2
Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Production Schedule M1.1, M2.1, M2.2, M3.2 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Source Execution Data M2.2 Sourcing Plans P2.4 Logistics Selection ES.6 Supplier Performance ES.2
! S2.1 !
Product On Order P2.2, ES.10 Procurement Signal (Supplier) Scheduled Receipts S1.2, S3.4, M1.1, M2.1, M3.2, D1.8, D4.2
Defective Products DR1.4 Excess Products DR3.4 MRO Products DR2.4 Product D1.13, D2.13, D3.13
! S2.2 !
! S2.3 !
Finished Goods Inventory Location ED.4 WIP Inventory Location EM.6 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Product Inventory Location ES.4 Receipt Verication S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
! S2.4 !
Inventory Availability P2.2, P3.2, ES.4, M1.2, M2.2, M3.3, D1.3, D1.8, D1.9, D2.3, D2.9, D3.9, D4.2, D4.3 Transferred Product S1.5, S2.5, S3.7 Existing Inventory Data ES.4, ED.4
! S2.5
3.2.13
S2.1
Scheduling and managing the execution of the individual deliveries of product against the contract. The requirements for product deliveries are determined based on the detailed sourcing plan. This includes all aspects of managing the contract schedule including prototypes, qualications or service deployment.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Metric % Schedules Changed within Suppliers Lead Time Average Release Cycle of Changes, Average Days per Schedule Change, Average Days per Engineering Change, Schedule Product Deliveries Cycle Time None Identied Cost to Schedule Product Deliveries, Quantity per shipment None Identied Description/Denition EDI interface for 830, 850, 856 & 862 transactions Electronic Kanban support
Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Utilize EDI Transactions to Reduce Cycle Time and Costs Mechanical (Kanban) Pull Signals Are Used to Notify Suppliers of the Need to Deliver Product Infrequent product delivery Consignment Agreements Are Used to Reduce Assets and Cycle Time While Increasing the Availability of Critical Items Bundle deliveries Advanced Ship Notices Allow for Tight Synchronization between Source and Make Processes Vendor Managed Inventory
Minimize need for frequent shipments by accurately determining product needs Consignment inventory management
Bundle deliveries of dierent products into single shipment when possible Blanket order support with scheduling interfaces to external supplier systems VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels.
3.2.14
S2.1
Inputs
Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Production Schedule M1.1, M2.1, M2.2, M3.2 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Source Execution Data M2.2 Sourcing Plans P2.4 Logistics Selection ES.6 Supplier Performance ES.2
Outputs
> S2.1
> Procurement Signal (Supplier)

Scheduled Receipts S1.2, S3.4, M1.1, M2.1, M3.2, D1.8, D4.2
Product On Order P2.2, ES.10
3.2.15
S2.2
Process Element: Receive Product
Performance Attributes Supply Chain Reliability Metric % Orders/ Lines Received On-Time To Demand Requirement, % Orders/ Lines Processed Complete, % Orders/ lines received with correct packaging, % Orders/ Lines Received with Correct Shipping Documents Receiving Product Cycle Time None Identied Cost to Receive Product None Identied Description/Denition Bar code interface for data collection devices. Generate bar coded receiving documents. Product serial number used as identier. RFID VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Skip lot/sampling inspection logic
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Vendor Managed Inventory
Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection Deliveries Are Balanced Throughout Each Working Day and Throughout the Week Supplier Delivers Directly to Point of Use
None identied
Electronic Tag tracking to Point of Use (POU) destination
3.2.16
S2.2
Inputs
Defective Products DR1.4 Excess Products DR3.4 MRO Products DR2.4 Product D1.13, D2.13, D3.13
> S2.2
> Receipt Veri cation S1.3, S1.4, ES.1, ES.2, ES.6, ES.8,
S2.3, S2.4, S3.5, S3.6, ED.8
Outputs
3.2.17
S2.3
Verify Product
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Deliveries Are Balanced Throughout Each Working Day and Throughout the Week Supplier Delivers Directly to Point of Use Monitor product compliance Supplier Replaces Defective Material at Customers Facility with Good Product as Required Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Supplier Delivers Directly to Point of Use Metric % Orders/ Lines Received Defect Free, % Orders/ lines received with correct content Verify Product Cycle Time None Identied Cost to Verify Product None Identied Description/Denition None identied
Electronic Tag tracking to Point of Use (POU) destination Review product for compliance with environmental specications, including product packaging Electronic Tag tracking to Point of Use (POU) destination
Skip lot/sampling inspection logic
Bar code interface for data collection devices Generate bar coded receiving documents. Product serial number used as identier. RFID Electronic Tag tracking to Point of Use (POU) destination
Inputs
> S2.3
> Receipt Veri cation S3.4, S3.5 S1.2, S1.3, S2.2, S2.3,
Outputs
3.2.18
S2.4
Transfer Product
The transfer of accepted product to the appropriate stocking location within the supply chain. This includes all of the activities associated with repackaging, staging, transferring, and stocking product and or application of service.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Implement pollution prevention program Utilize high eciency vehicles Drive Deliveries Directly to Stock or Point-Of-Use in Manufacturing to Reduce Costs and Cycle Time Capability Transfer to Customer Utilize alternative fuel vehicles Metric % Product Transferred On-Time to Demand Requirement, % Product Transferred without Transaction Errors Transfer Product Cycle Time None Identied Energy Costs, Cost to Transfer Product Inventory Days of Supply Description/Denition Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Utilize high fuel eciency vehicles Pay on receipt. Specify delivery location and time (to the minute).Specify delivery sequence None identied Utilize alternative fuel vehicles
Inputs
Finished Goods Inventory Location ED.4 WIP Inventory Location EM.6 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Product Inventory Location ES.4 Receipt Verication S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
Outputs
Inventory Availability P2.2, P3.2, ES.4, M1.2, M2.2, M3.3, D1.3, D1.8, D1.9, D2.3, D2.9, D3.9, D4.2, D4.3 S1.5, S2.5, S3.7 Existing Inventory Data ES.4, ED.4
> S2.4
> Transferred Product
3.2.19
S2.5
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Pay on Receipt Metric None Identied Authorize Supplier Payment Cycle Time None Identied Cost to Authorize Supplier Payment None Identied Description/Denition Electronic Invoice Processing
Inputs
> S2.5
> None Identi ed
Outputs
3.2.20
S3
Source Engineerto-Order Product
The processes of identifying and selecting sources of supply, negotiating, validating, scheduling, ordering and receiving parts, assemblies or specialized products or services that are designed, ordered and/or built based on the requirements or specications of a specic customer order.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Order Fulllment Cycle Time, Source Cycle Time None Identied Cost to Source, Product Acquisition Costs Return on Supply Chain Fixed Assets, Return on Working Capital, Inventory Days of Supply (Raw Material) Description/Denition Select suppliers with active EMS systems Utilize green purchasing practices Collaborative Planning Systems
Best Practices Select suppliers with EMS Utilize green purchasing practices Joint Service Agreements (JSA)
3.2.21
S3
Business Rules for Source Processes ES.1 Sourcing Plans P2.4 Supplier Data ES.7 Current Inventory Source Data ES.3 ETO Spec or Design
! S3.1 !
ETO Request for Proposal
Business Rules for Source Processes ES.1 Supplier Data ES.7 Current Inventory Source Data ES.3 ETO Proposal
! S3.2 !
Procurement Signal (Supplier) Supplier Agreement ES.10, ES.5, ES.7, S3.3, EM.6
Logistics Selection ES.6 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Supplier Agreement ES.10, S3.2 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Supplier Performance ES.2 Sourcing Plans P2.4 Production Schedule M1.1, M2.1, M2.2, M3.2
! S3.3 !
Procurement Signal (Supplier) Scheduled Receipts S1.2, S3.4, M1.1, M2.1, M3.2, D1.8, D4.2 Product On Order P2.2, ES.10
Product D1.13, D2.13, D3.13 Scheduled Receipts S1.1, S2.1, S3.3
! S3.4 !
! S3.5 !
Product Inventory Location ES.4 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Finished Goods Inventory Location ED.4 WIP Inventory Location EM.6 Receipt Verication S1.2, S1.3,. S2.2, S2.3, S3.4, S3.5
! S3.6 !
Inventory Availability P2.2, P3.2, ES.4, M1.2, M2.2, M3.3, D1.3, D1.8, D1.9, D2.3, D2.9, D3.9, D4.2, D4.3 Existing Inventory Data ES.4 Transferred Product S1.5, S2.5, S3.7
! S3.7
3.2.22
S3.1
Identify Sources of Supply
The identication and qualication of potential suppliers capable of designing and delivering product that will meet all of the required product specications.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Product Data Management & Electronic Document Management Are Used to Manage Technical Documents and Requirements for Engineer to Order Product Electronic Data Interchange is Used to Send Technical Information to and from Potential Suppliers On Line RFQ Processes Linked into the Document Management Process Reduces Cycle Time and Product Management Costs Purchase recycled product Concurrent Engineering is Used to Tightly Link Sourcing into the Product Development Process Make/Buy Decision Process (Outsourcing vs. In Sourcing) Purchase previously used supplies Supplier Development Programs Are Used to Get Local Suppliers to Invest in Developing New Technologies Metric % of suppliers with an EMS or ISO 14001 certication Identify Sources of Supply Cycle Time None Identied Cost to Identify Sources of Supply % of material that has a valid Take-back program, % of materials that are recyclable/ reusable Description/Denition None identied
None identied
None identied
Purchase products from recyclers or remanufactures None identied
Purchase previously used supplies None identied
3.2.23
S3.1
Inputs
Business Rules for Source Processes ES.1 Sourcing Plans P2.4 Supplier Data ES.7 Current Inventory Source Data ES.3 ETO Spec or Design
> S3.1
Outputs > ETO Request for Proposal
3.2.24
S3.2
Select Final Supplier (s) and Negotiate
The identication of the nal supplier(s) based on the evaluation of RFQs, supplier qualications and the generation of a contract dening the costs and terms and conditions of product availability.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Select rms with EMS Utilize Concurrent Engineering with Suppliers to Allow Them to Provide Engineering and Product Performance Test Data Select ISO 14001 rms Product take-back programs On Line Document Management and Automated Supplier Approval Processes Can Reduce the Cycle Time and Costs Associated With Managing Supplier Evaluations and Get Them into the Supplier Network Faster Electronic Data Interchange Can Be Used To Send Rfqs and Technical Information to and from Potential Suppliers to Determine Supplier Capability to Fulll Requirements So that They May Be Added to Supplier Network Supplier Certication Programs Can Reduce the Cycle Time for Certifying Existing Suppliers to Provide New Technologies On Line RFQ Processes Linked into the Document Management Process Reduces Cycle Time and Product Management Costs On-Line Availability to Supplier Financials to Determine Potential Supplier Viability to be Added to Supplier Network Metric % of suppliers with an EMS or ISO 14001 certication Select Supplier and Negotiate Cycle Time None Identied Cost to Select Final Supplier(s) and Negotiate None Identied Description/Denition Select rms that have implemented an EMS None identied
Select rms that are ISO 14001 certied or similar Select rms that oer product take-back programs ERP
Electronic Data Interchange
None identied
None identied
Internet web sites for nancial evaluation
3.2.25
S3.2
Inputs
Business Rules for Source Processes ES.1 Supplier Data ES.7 Current Inventory Source Data ES.3 ETO Proposal
> S3.2
> Procurement Signal (Supplier)

Supplier Agreement ES.10, ES.5, ES.7, S3.3, EM.6
Outputs
3.2.26
S3.3
Scheduling and managing the execution of the individual deliveries of product against the contract. The requirements for product deliveries are determined based on the detailed sourcing plan. This includes all aspects of managing the contract schedule including prototypes and qualications.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Metric % Schedules Changed within Suppliers Lead Time Average Release Cycle of Changes, Schedule Product Deliveries Cycle Time, Average Days per Engineering Change, Average Days per Schedule Change None Identied Quantity per shipment, Cost to Schedule Product Deliveries None Identied Description/Denition Electronic Kanban support
Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Mechanical (Kanban) Pull Signals Are Used to Notify Suppliers of the Need to Deliver Product Infrequent product delivery Bundle deliveries Utilize EDI Transactions to Reduce Cycle Time and Costs Advanced Ship Notices Allow for Tight Synchronization between Source and Make Processes Consignment Agreements Are Used to Reduce Assets and Cycle Time While Increasing the Availability of Critical Items
Minimize need for frequent shipments by accurately determining product needs Bundle deliveries of dierent products into single shipment when possible EDI interface for 830, 850, 856 & 862 transactions Blanket order support with scheduling interfaces to external supplier systems Consignment inventory management
3.2.27
S3.3
Inputs
Logistics Selection ES.6 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Supplier Agreement ES.10, S3.2 Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Supplier Performance ES.2 Sourcing Plans P2.4 Production Schedule M1.1, M2.1, M2.2, M3.2
Outputs
Procurement Signal (Supplier) Scheduled Receipts S1.2, S3.4, M1.1, M2.1, M3.2, D1.8, D4.2 Product On Order P2.2, ES.10
> S3.3
>
3.2.28
S3.4
Receive Product
Performance Attributes Supply Chain Reliability Metric % Orders/ Lines Processed Complete, % Orders/ Lines Received with Correct Shipping Documents, % Orders/ lines received with correct packaging, % Orders/ Lines Received On-Time To Demand Requirement Receiving Product Cycle Time None Identied Cost to Receive Product None Identied Description/Denition Electronic Tag tracking to Point of Use (POU) destination
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Supplier Delivers Directly to Point of Use - (Dock to Line or End Destination) Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Deliveries Are Balanced Throughout Each Working Day and Throughout the Week Vendor Managed Inventory
Bar code interface for data collection devices. Generate bar coded receiving documents. Product serial number used as identier. RFID None identied
VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The onsite inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Skip lot/sampling inspection logic
Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection Carrier Agreement
Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions.
3.2.29
S3.4
Inputs
Product D1.13, D2.13, D3.13 Scheduled Receipts S1.1, S2.1, S3.3
Outputs
> S3.4
> ES.1, ES.2, ES.6, ES.8, S1.3, S1.4, S2.3, S2.4, S3.5, S3.6, ED.8
Receipt Veri cation
3.2.30
S3.5
Verify Product
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection Supplier Replaces Defective Material at Customers Facility with Good Product as Required Deliveries Are Balanced Throughout Each Working Day and Throughout the Week Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Supplier Delivers Directly to Point of Use Monitor product compliance Metric % Orders/ lines received with correct content, % Orders/ Lines Received Defect Free Verify Product Cycle Time None Identied Cost to Verify Product None Identied Description/Denition Skip lot/sampling inspection logic
Electronic Tag tracking to Point of Use (POU) destination
None identied
Bar code interface for data collection devices. Generate bar coded receiving documents. Product serial number used as identier. RFID Electronic Tag tracking to Point of Use (POU) destination Review product for compliance with environmental specications, including product packaging
Inputs
> S3.5
> Receipt Veri cation
Outputs
S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
3.2.31
S3.6
Transfer Product
The transfer of accepted product to the appropriate stocking location within the supply chain. This includes all of the activities associated with repackaging, staging, transferring, and stocking product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Drive Deliveries Directly to Stock or Point-Of-Use in Manufacturing to Reduce Costs and Cycle Time Utilize high eciency vehicles Utilize alternative fuel vehicles Implement pollution prevention program Capability Transfer to Organization Metric % Product Transferred without Transaction Errors, % Product Transferred On-Time to Demand Requirement Transfer Product Cycle Time None Identied Cost to Transfer Product, Energy Costs Inventory Days of Supply Description/Denition Pay on receipt. Specify delivery location and time (to the minute).Specify delivery sequence Utilize high fuel eciency vehicles Utilize alternative fuel vehicles Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing None identied
Inputs
Product Inventory Location ES.4 Replenishment Signal M1.2, M2.2, M3.3, D1.3, D2.3, D3.3 Finished Goods Inventory Location ED.4 WIP Inventory Location EM.6 Receipt Veri cation S1.2, S1.3,. S2.2, S2.3, S3.4, S3.5
Outputs
> S3.6
>
Inventory Availability P2.2, P3.2, ES.4, M1.2, M2.2, M3.3, D1.3, D1.8, D1.9, D2.3, D2.9, D3.9, D4.2, D4.3 Existing Inventory Data ES.4 Transferred Product S1.5, S2.5, S3.7
3.2.32
S3.7
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Reliability Supply Chain Costs Supply Chain Asset Management Best Practices Pay on Receipt Metric None Identied Authorize Supplier Payment Cycle Time None Identied Cost to Authorize Supplier Payment None Identied Description/Denition Electronic Invoice Processing
Inputs
> S3.7
> None Identi ed
Outputs
3.2.33
ES
Enable Source
The collection of processes associated with managing and monitoring Source process data, performance and relationships.
Process Categories ES.1: Manage Sourcing Business Rules The process of dening requirements and establishing, maintaining and enforcing decision support criteria, in alignment with business strategy, goals and objectives. The business strategy denes the criteria for sourcing business rules that are translated into guidelines and policies for conducting business within the enterprise and other legal entities. Sourcing business rules include: supplier selection and negotiation processes, fulllment and delivery performance and relationship denition for specic levels of collaboration and partnership. The process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs The process of collecting, sorting, dening hierarchy and managing conguration control of supplier information and source data that are required to make sourcing and related planning and manufacturing decisions. Source data to be maintained includes supplier prole data, nancials, quality and delivery performance, spend analysis at various levels of the enterprise, from major business units to material part number The process of establishing and maintaining physical inventories and inventory information. This includes warehouse management, cycle counting, physical inventories and inventory reconciliation. For Services, this may include tracking the number of service providers and the nancial resources committed at any given point in time. The process of acquiring, maintaining and dispositioning an organizations capital assets located at a suppliers facility and/ or outside source, which are used to operate the supply chain. The process of dening and maintaining the information that characterizes inbound logistics management of all supplier deliveries, including both physical and electronic goods and services. This includes carrier selection and management, tracking deliveries and import
ES.3: Maintain Source Data
ES.4: Manage Product Inventory
ES.5: Manage Capital Assets
ES.6: Manage Incoming Product
3.2.34
ES
ES.7: Manage Supplier Network The process of dening and maintaining a unique network of suppliers to deliver a specic product set. This includes establishment of a new supplier or maintaining an existing supplier and all the tasks and activities associated with identifying and qualifying the supplier and nalizing on the sourcing terms and conditions. Also, the management of a supplier certication process, which includes certifying new suppliers and maintaining the current status of existing suppliers. The process of identifying and complying with import/export regulatory documentation and process standards set by external entities (eg, government). The process of managing Source risks within an overall Supply Chain Risk Program. This includes identifying and assessing Source risks as well as planning and implementing responses to Source risks. Source risks include potential events that could impact the organizations or the supplierss ability to deliver raw material in a timely manner at a reasonable cost with acceptable quality. Risk Management includes: migration, either reduicing the impact of a risk event of reducing the likelihood of its occurrence. The management of existing purchase orders or supplier contracts. This includes managing volume/step pricing, resolving issues, enforcing terms and conditions and maintaining an accurate status for existing purchase orders or contracts.
ES.8: Manage Import/Export Requirements ES.9: Manage Supply Chain Source Risk
ES.10: Manage Supplier Agreements
3.2.35
ES
Supplier Data ES.7 Receipt Verication S1.2, S1.3,. S2.2, S2.3, S3.4, S3.5
! ! ! ! ! ! ! ! !
ES.1
Business Rules for Return Processes P5.1, P5.2, ES.7, SR1.1, SR2.1, SR3.1,DR1.1, DR2.1, DR3.1, ER.4, ER.5, ER.7, ER.8 Business Rules for Source Processes ES.4, S3.1, S3.2
Supplier Data ES.7 Receipt Verication S1.2, S1.3,. S2.2, S2.3, S3.4, S3.5
ES.2 ! ES.3 ! ES.4

!
Quality and Delivery Performance Supplier Performance ES.7, S1.1, S2.1, S3.3
Supplier Data ES.7 Sourcing Plans P2.4 Quality & Delivery Peformance
Quality and Delivery Performance
Existing Inventory Data S1.4, S2.4. S3.6, D1.8 Sourcing Plans P2.4 Business Rules for Source Processes ES.1 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Parts and Services Consumed EM.5
Product Inventory Location S1.4, S2.4, S3.6 Product Inventory Target Levels P2.2 MRO Parts Availability EM.5 Supply Chain Performance Metrics EP.2, ED.1, ED.5
Parts and Services Consumed EM.5 Supplier Agreement ES.10, S3.2 Import/Export Requirements ES.8
ES.5 ! ES.6 ! ES.7 ! ES.8 ! ES.9 !
Capital Assets ES.8
Import/Export Requirements ES.8 Contact Carrier Rates ES.8 Receipt Verication S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
Logistics Selection S1.1, S2.1, S3.3
Business Rules for Return Processes ES.1, ER.1 Current Inventory Source Data ES.3 Supplier Agreement ES.10, S3.2 Supplier Performance ES.2
Supplier Data ES.1, ES.10, ES.2, ES.3, S3.1, S3.2
Parts and Services Consumed EM.5 Capital Assets ES.5 Receipt Verication S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
Contract Carrier Rates ES.6, ED.6 Import/Export Requirements ES.5, ES.6, ES.10
Monitoring Internal Information
Internal Adjustments Risk Management Programs for Process Area
Supplier Agreement ES.10, S3.2 Supplier Data ES.7 Product On Order S1.1, S2.1, S3.3 Import/Export Requirements ES.8
! ES.10 !
Payment Terms S1.5, S2.5, S3.7 Supplier Aggrement ES.10, S3.2
3.2.36
ES.1
Manage Sourcing Business Rules
The process of dening requirements and establishing, maintaining and enforcing decision support criteria, in alignment with business strategy, goals and objectives. The business strategy denes the criteria for sourcing business rules that are translated into guidelines and policies for conducting business within the enterprise and other legal entities. Sourcing business rules include: supplier selection and negotiation processes, fulllment and delivery performance and relationship denition for specic levels of collaboration and partnership.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Optimized Supply-Chain Processes, Optimized Supplier Count, Supplier and Part Rationalization Collaborative environmental management processes Long Term Supplier Agreements/ Partnerships Enterprise Level Policies/Rules with Local Execution Electronic Sourcing and Negotiation Enterprise Level Spend Analysis Metric None Identied Manage Sourcing Business Rules Cycle Time None Identied Cost to Manage Sourcing Business Rules None Identied Description/Denition Web based access to preferred and recommended suppliers, supplier performance data & spend data stratied by commodity, business unit/site, supplier, part type, process type Collaborative environmental management processes with suppliers, including EMS integration Electronic rules for business relationships and transactions: Vendor-managed Inventory Agreements, Fab & Hold Agreements, Just-In-Time Agreements. Web based access to enterprise level business rules Business Rules for electronic sourcing process and hierarchy None identied
Outputs Inputs
Supplier Data ES.7 Receipt Veri cation S1.2, S1.3,. S2.2, S2.3, S3.4, S3.5 Business Rules for Return Processes P5.1, P5.2, ES.7, SR1.1, SR2.1, SR3.1,DR1.1, DR2.1, DR3.1, ER.4, ER.5, ER.7, ER.8 Business Rules for Source Processes ES.4, S3.1, S3.2
> ES.1
>
3.2.37
ES.2
Assess Supplier Performance
The process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Comparative Analysis of Supplier Performance is Used in Sourcing Decisions Supplier Cost of Nonconformance Data is Collected, Analyzed and Used in Performance Reporting Cost Reduction and or Cost Avoidance Are Opportunities Are Identied, Implemented and measured on a Periodic Basis Supplier environmental performance criteria Performance Expectations and Business Rules Are Clearly Communicated Prior to the Initiation of Business with the Supplier Develop supplier partnerships Metric % of suppliers meeting environmental metrics/criteria Assess Supplier Performance Cycle Time None Identied Cost to Assess Supplier Performance None Identied Description/Denition Software application with data analysis capability Software application to automate data collection and reporting None identied
Develop a set of environmental performance criteria for all suppliers Web based access / availability to business rules and performance criteria Develop a partnership with suppliers to help them implement and maintain environmentally sustainable business practices Assess Supplier Performance is the process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs. None identied
Supplier Performance Assessment System
Continuous Improvement and Development is Driven and Measured through the Performance Review Process
3.2.38
ES.2
Best Practices cont. Carrier Agreement Description/Denition cont. Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions.
Inputs
Supplier Data ES.7 Receipt Veri cation S1.2, S1.3,. S2.2, S2.3, S3.4, S3.5
Outputs
> ES.2
>
Quality and Delivery Performance Supplier Performance ES.7, S1.1, S2.1, S3.3
3.2.39
ES.3
Maintain Source Data
The process of collecting, sorting, dening hierarchy and managing conguration control of supplier information and source data that are required to make sourcing and related planning and manufacturing decisions. Source data to be maintained includes supplier prole data, nancials, quality and delivery performance, spend analysis at various levels of the enterprise, from major business units to material part number
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Supplier and Material Rationalization Automated Update of Supplier Performance Information On Demand Access of Supplier/ Source Data Data Accessibility across the Enterprise for Visibility by Discrete Business Units Metric None Identied Maintain Source Data Cycle Time None Identied Cost to Maintain Source Data None Identied Description/Denition Web based access to supplier/source data None identied Web based access to current supplier/source data Web based access to various levels of enterprise data
Access to supplier environmental management and compliance data
Inputs
Supplier Data ES.7 Sourcing Plans P2.4 Quality & Delivery Peformance
Outputs
> ES.3
> Current Inventory Source Data

ES.7, S3.1, S3.2, ED.7
3.2.40
ES.4
Manage Product Inventory
The process of establishing and maintaining physical inventories and inventory information. This includes warehouse management, cycle counting, physical inventories and inventory reconciliation. For Services, this may include tracking the number of service providers and the nancial resources committed at any given point in time.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied Manage Product Inventory Cycle Time None Identied Cost to Manage Product Inventory, Number of worker absences due to poor IAQ, Warehousing solid waste, Packaging material re-use, % of warehouse loading machinery using MFBs, Warehouse energy costs, Water use reduction, Hazardous waste generated at warehousing facilities as % of total waste generated Inventory Days of Supply Description/Denition The Statistical Test Count (STC) process is a method of validating inventory on-hand values by physically counting and reconciling a statistical sample of the entire inventory population. This sample is then extrapolated across the inventory population, which provides an indicative measure of entire inventory population. Furthermore, with extrapolation the net and gross percentage of error is determined. VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Implement storm water management and spill response plans Utilize energy-ecient HVAC systems Dynamic calculation of safety stock based on actual sales. Utilize maintenance free batteries in warehouse/short haul vehicles
Supply Chain Asset Management Best Practices Statistical Test Count
Vendor Managed Inventory
Storm water management plans Energy-ecient HVAC systems Real Time Data on Current Status Utilize maintenance free batteries
3.2.41
ES.4
Best Practices cont. Energy-ecient buildings Periodic Review of Metrics and Strategy with Comparisons to Industry Benchmarks Reusable pallets Description/Denition cont. Utilize energy-ecient lighting and heating systems throughout warehouse and production areas Real time view of data.
Utilize reusable pallets
Inputs
Existing Inventory Data S1.4, S2.4. S3.6, D1.8 Sourcing Plans P2.4 Business Rules for Source Processes ES.1 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Parts and Services Consumed EM.5
Outputs
Product Inventory Location S1.4, S2.4, S3.6 Product Inventory Target Levels P2.2 EM.5
> ES.4
> MRO Parts Availability
Supply Chain Performance Metrics EP.2, ED.1, ED.5
3.2.42
ES.5
Manage Capital Assets
The process of acquiring, maintaining and dispositioning an organizations <capital assets> located at a suppliers facility and/or outside source, which are used to operate the supply chain.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Changeover Reduction / Continuous Improvement Program Metric % of assets in compliance with scheduled maintenance requirements Manage Capital Assets Cycle Time None Identied Cost to Manage Source Capital Assets None Identied Description/Denition Changeover process ow element identication, instructional directions to conduct changeover, and measurement tool, which can be used to prioritize and track results of improvement eorts. Software to identify operational constraints to the MAKE processes to assist in directing resources toward bottleneck functional areas. Automatically generated TPM repair schedules integrated with MRP systems, electronic equipment repair history, parts listings, part stores inventory & reorder points, automatic store room parts purchases, Shop oor access to electronic data base of equipment line drawings, electrical wiring diagrams, parts listing reference guide and part cost lists. Automated Calculation of ABC Velocity Movement System software to list checklist items, report results of audit & forward actions to be taken
Total Preventative Maintenance Program
Removal of Obsolete Capital Assets Facility & Equipment Environmental / Safety Audit System
Inputs
Parts and Services Consumed EM.5 Supplier Agreement ES.10, S3.2 Import/Export Requirements ES.8
> ES.5
> Capital Assets ES.8
Outputs
3.2.43
ES.6
Manage Incoming Product
The process of dening and maintaining the information that characterizes inbound logistics management of all supplier deliveries, including both physical and electronic goods and services. This includes carrier selection and management, tracking deliveries and import.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Real-Time Optimized Shipment Method Selection (Air Parcel, Ground Parcel, LTL, etc.) Based on Customer Service Requirements Automated Documentation for International Shipments Backhaul Trading Exchange Capture and Maintain Mode Specic Data Integrated Order Management, Warehouse Management, and Transportation Management Systems View for analysis for all orders and shipments the following data: Logistics, Product, Cost, GL Charging Real-Time Shipment Tracking, (via internet) Measurement of Carrier Performance for On-time Delivery and Completeness Electronic Manifest and Electronic Billing Appointment Scheduling for Pickup and Delivery of Customer Shipments Metric None Identied Manage Incoming Product Cycle Time None Identied Cost to Manage Incoming Product None Identied Description/Denition Transportation Management System (TMS) Maintenance Management
Transportation Management System (TMS) Maintenance Management Pooling Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management
Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management
3.2.44
ES.6
Best Practices cont. Manage Information Across 100% of Shipments Rating & Routing Description/Denition cont. Transportation Management System (TMS) Maintenance Management Internet Pooling (Electronic brokerage of shipments
Inputs
Import/Export Requirements ES.8 Contact Carrier Rates ES.8 Receipt Veri cation S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
> ES.6
Outputs > Logistics Selection

S1.1, S2.1, S3.3
3.2.45
ES.7
Manage Supplier Network
The process of dening and maintaining a unique network of suppliers to deliver a specic product set. This includes establishment of a new supplier or maintaining an existing supplier and all the tasks and activities associated with identifying and qualifying the supplier and nalizing on the sourcing terms and conditions. Also, the management of a supplier certication process, which includes certifying new suppliers and maintaining the current status of existing suppliers.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Establishment of Criteria to Rank Suppliers Evaluate Supplier Network for Duplicates Vendor Managed Inventory Metric % of suppliers meeting environmental metrics/criteria Manage Supplier Network Cycle Time None Identied Cost to Manage Supplier Network None Identied Description/Denition Utilize supplier delivery, quality, price performance as well as any other criteria such as terms and conditions Supplier Merge Programs for duplicates VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels.
Supplier Certication Programs Can Reduce the Cycle Time for Initial Certication of New Suppliers or Certifying Existing Suppliers that Wish to Provide New Technologies Electronic Data Interchange Can Be Used To Send Rfqs and Technical Information to and from Potential Suppliers to Determine Supplier Capability to Fulll Requirements So that They May Be Added to Supplier Network Establish environmental requirements On-Line Availability to Supplier Financials to Determine Potential Supplier Viability to be Added to Supplier Network Electronic Data Interchange
Establish supplier environmental requirements Internet web sites for nancial evaluation
3.2.46
ES.7
Best Practices cont. Identication of Suppliers Who Will Participate in Vendor Managed Inventory (VMI) Programs Identication of Suppliers Who Will Participate in Kanban Programs Internet Exchanges Description/Denition cont. Supplier managed inventories with scheduling interfaces to external supplier systems to replenish Electronic Kanban Support Internet Exchanges are a hosted, business-to-business trading network. Exchanges are an open procurement network, accessible to any buyer and focused on new Internet-enabled purchasing models like spot buys or reverse, buyer-driven auctions. Exchanges will also support more traditional catalog-based sales. None identied
Supplier Certication Programs Can Reduce the Cycle Time for Certifying Existing Suppliers to Provide New Technologies
Create and Maintain Multiple Suppliers and None Identied Multiple Supplier Sites to Record Information about Individuals and Companies from Whom You Want to Purchase Catalogue Goods and Services On Line Document Management and ERP Automated Supplier Approval Processes Can Reduce the Cycle Time and Costs Associated With Managing Supplier Evaluations and Get Them into the Supplier Network Faster Carrier Agreement Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions. None identied
Identication of Suppliers Who Will Participate in Procurement Split (Two or More Suppliers Sharing Purchase Requirements) Programs Utilize Concurrent Engineering with Suppliers to Allow Them to Provide Engineering and Product Performance Test Data to Qualify as Part of Potential Supplier Network
Internet, EDI, FAX
3.2.47
ES.7
Inputs
Business Rules for Return Processes ES.1, ER.1 Current Inventory Source Data ES.3 Supplier Agreement ES.10, S3.2 Supplier Performance ES.2
> ES.7
> Supplier Data ES.3, S3.1, S3.2 ES.1, ES.10, ES.2,
Outputs
3.2.48
ES.8
Manage Import/ Export Requirements (Source)
The process of identifying and complying with import/export regulatory documentation and process standards set by external entities (eg, government).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Direct Transfer of Documents to Recipient and Forwarder Ability to Track Component/SubComponent Manufacturing Country of Origin Direct Connection to Customs Clearance Track foreign environmental requirements Assessing Export/Import Requirements during Time of Product Development/Manufacture Metric None Identied Customs Clearance Cycle Time, Manage Import/Export Requirements Cycle Time None Identied Cost to Manage Import/Export Requirements None Identied Description/Denition Electronic documentation submission via EDI and/or internet. Component/lot tracking (lot trace-ability)
Electronic documentation submission via EDI and/or internet. Maintain and manage current foreign environmental regulations Multi-country Export/Import documentation compliance
Inputs
Parts and Services Consumed EM.5 Capital Assets ES.5 Receipt Veri cation S1.2, S1.3, S2.2, S2.3, S3.4, S3.5
> ES.8
> Contract Carrier Rates ES.6, ED.6

Import/Export Requirements ES.5, ES.6, ES.10
Outputs
3.2.49
ES.9
Manage Supply Chain Source Risk
The process of managing Source risks within an overall Supply Chain Risk Program. This includes identifying and assessing Source risks as well as planning and implementing responses to Source risks. Source risks include potential events that could impact the organizations or the supplierss ability to deliver raw material in a timely manner at a reasonable cost with acceptable quality. Risk Management includes: migration, either reduicing the impact of a risk event of reducing the likelihood of its occurrence.
Performance Attributes Supply Chain Reliability Metric VAR of product/customer performance - , Supplier Mitigation Plans Implemented (percent), VAR of Internal Process Performance, Value at Risk (Source), VAR of Supplier Performance, Age of Supplier Risk Data (months), Age of Product / Customer Risk Data (months) External Event Response (average days) Internal Event Response (average days) Mitigation Cost ($), Assessment / Risk Management Costs ($), Mitigation cost by Event ($) Individual Process Area Event Rating (EVAR) ($), Supply / Customer / Product Base Rated (%), Residual Risk ($), Gross Risk ($), Event Risk (EVAR) ($), Mitigated Risk ($) Description/Denition A key aspect of supply chain risk management is identication. Identication involves creating a list of potential events that could harm any aspect of the supply chains performance. Risk identication allows an organization to take steps to create plans to manage risks before they occur. this is typically more cost eective then waiting to react to adverse events when they occur. Open communication is necessary for eective risk management, where the term open refers to the possibility to directly reach the right person who can better handle the information about a crisis situations wherever in the organization. Managers require direct communication channels up, down and across their business units to help identify risks and take appropriate actions.
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs
Best Practices Supply Chain Risk Identication
Crisis Communications Planning
3.2.50
ES.9
Best Practices cont. Supply Chain Risk Monitoring Description/Denition cont. Once areas of risk have been identied, an organization needs to monitor their internal and external environment. This helps them to predict when risky events are becoming more likely. It also helps to identify new risks and is tightly linked to the best practice of Supply Chain Risk Identication. This practice involves establishing business rules (e.g., customer priority, supplier priority, production routing, transportation routing, etc.) based on minimizing the risk to the supply chain. Under this practice, business rules are established or congured in response to the corporate risk management plan with a goal of reducing either the likelihood of a disruption occurring or the impact to the supply chain should a disruption occur. Business rule reconguration typically includes an assessment of the impact of each rule change on the overall supply chain before actual implementation. Supply Chain Information Congured to Minimize Risk This practice involves managing supply chain information networks to minimize the risk to the supply chain. This includes information sharing with partners as well as internal locations. This helps all parties to be quickly informed of a real or potential disruption and respond quickly and appropriately to minimize the disruption impact. Supply Chain Risk assessment provides management with an understanding of where the greatest risks may exist in order to prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of the risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events. the team can then prioritize addressing the risks. Strategies can be implemented to minimize sourcing risk. This practice relies on a risk evaluation of the supply chain to guide the design of the supply chain network. Node locations, transportation routes, capacity size and location, number of suppliers, number of production locations, etc. are all determined in a fashion that mitigates potential disruptions to the ability to deliver product and service to the end customer. This practice relies on the information collected through risk identication and risk assessment processes to identify nodes that are at a high risk of disruption due to the location of the node. Location specic risks can include tactical strike risks, natural disaster risks, single point of failure risks, etc.
Supply Chain Business Rules Congured to mitigate risk
Sourcing Risk Mitigation Strategies Supply Chain Network Congured to Mitigate Risk
3.2.51
ES.9
Best Practices cont. Sourcing Opportunities Prioritization to Improve Cost & Security of Supply Description/Denition cont. Many businesses need to improve performance through reliable Sourcing of more cost-eective supplies & services to meet customers needs and growth opportunities. This Best Practice covers strategic sourcing approaches for reducing Total Cost of Ownership, and simultaneously assessing supply risk in case of business rationalization, excessive demand, re, work outage, etc The process of coordinated risk management places a strong emphasis on cooperation among departments within a single company and among dierent companies of a supply chain to eectively manage the full range of risks as a whole. A closer coordination of risk management activities performed throughout the supply chain is intended to conserve resources and increase eectiveness. Supply chain risk management is the systematic identication, assessment and mitigation of potential disruptions in logistics networks with the objective to reduce their negative impact on the logistics networks performance.
Risk Management Programs Coordination with Partners
Inputs
Outputs
> ES.9
> Internal Adjustments Risk Management Programs

for Process Area
3.2.52
ES.10
Manage Supplier Agreements
The management of existing purchase orders or supplier contracts. This includes managing volume/step pricing, resolving issues, enforcing terms and conditions and maintaining an accurate status for existing purchase orders or contracts.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Enterprise Level Spend Analysis Enterprise Level Policies/Rules with Local Execution Carrier Agreement Metric % of suppliers meeting environmental metrics/criteria Manage Supplier Agreements Cycle Time None Identied Cost to Manage Supplier Agreements None Identied Description/Denition None identied Web based access to enterprise level business rules Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions. Electronic rules for business relationships and transactions: Vendor-managed Inventory Agreements, Fab & Hold Agreements, Just-In-Time Agreements. Web based access to preferred and recommended suppliers, supplier performance data & spend data stratied by commodity, business unit/site, supplier, part type, process type
Long Term Supplier Agreements/ Partnerships Optimized Supply-Chain Processes, Optimized Supplier Count, Supplier and Part Rationalization
Inputs
Supplier Agreement ES.10, S3.2 Supplier Data ES.7 Product On Order S1.1, S2.1, S3.3 Import/Export Requirements ES.8
Outputs
> ES.10
> Supplier Aggrement

ES.10, S3.2
Payment Terms S1.5, S2.5, S3.7
3.2.53
3.2.54
M
Make
The process of adding value to products through mixing, separating, forming, machining, and chemical processes.
Process Categories M1: Make-to-Stock The process of manufacturing in a make-to-stock environment adds value to products through mixing, separating, forming, machining, and chemical processes. Make to stock products are intended to be shipped from nished goods or o the shelf, can be completed prior to receipt of a customer order, and are generally produced to a planned schedule in accordance with a sales forecast. No customer reference or customer order detail or specication is attached to production orders, attached to or marked on the product, or recorded in the shop oor management or ERP system for Make-to-Stock products. Given plans for the production of specic parts, products, or formulations in specic quantities and planned availability of required sourced products, the scheduling of the operations to be preformed in accordance with these plans. Scheduling includes sequencing, and, depending on the factory layout, any standards for setup and run. In general intermediate production activities are coordinated prior to the scheduling of the operations to be preformed in producing a nished product. The process of developing, designing, validating, and ultimately using a manufacturing process to produce products or services based on the requirements of a specic customer. In general Engineer-to-Order requires that work instructions may need to be dened or rened and material routing instructions may need to be added or modied. An example of an alternative or related name for Make Engineer-to-Order is: Design-to-Order (DTO). The collection of processes associated with managing and monitoring Make process data, performance and relationships.
M2: Make-to-Order
M3: Engineer-to-Order
Enable Make
3.3.1
M1
Make-to-Stock
The process of manufacturing in a make-to-stock environment adds value to products through mixing, separating, forming, machining, and chemical processes. Make to stock products are intended to be shipped from nished goods or o the shelf, can be completed prior to receipt of a customer order, and are generally produced to a planned schedule in accordance with a sales forecast. No customer reference or customer order detail or specication is attached to production orders, attached to or marked on the product, or recorded in the shop oor management or ERP system for Make-to-Stock products.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric Yield Order Fulllment Cycle Time, Make Cycle Time Upside Make Adaptability, Downside Make Adaptability, Upside Make Flexibility Cost to Make, Cost of Goods Sold Cash-To-Cash Cycle Time, Return on Working Capital, Return on Supply Chain Fixed Assets Description/Denition VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. None identied Data warehouse, report writing, real time database and Executive Information systems that are easily accessible. Use of web-based technologies for dissemination of information. Examples would be TQM, Six Sigma. Capacity planning
Best Practices Vendor Managed Inventory
Link Individual Performance to Organizational and Divisional Goals Performance Results that Are Compared to Benchmarks (i.e. Capacity, Scheduling) and Readily Available to Employees Provide Continuous Formal Training to Employees Production Level Loading
3.3.2
M1
Best Practices cont. Organize to Enhance Flexibility Description/Denition cont. Few Job Classications, Self-Directed Work Force, Flat Management Structure, Cross-Functional Work Teams. Support for modular skills inventory with links to training databases, compensations systems, and operator instructions Manufacturing is broken into work cells Electronic document management that maintains current Standard Operating Procedures (SOP) Use a team based systematic approach to identifying and eliminating wasteful, or non-value adding activities within your manufacturing organization Electronic dispatch and data collection with external interface to internet. Support of demand-pull mechanisms (Kanban, replenishment signals, etc.) based on rate schedules and user-dened minimum/maximum trigger points
Cellular Manufacturing Accurate and Approved Work Instructions/Process Plans Lean Manufacturing
Paperless Order Tracking and Customer Visibility of Orders Demand-Pull Manufacturing, Including Active Reduction of Manufacturing Systems Time and WIP Through the Use of DemandPull Mechanisms and Visual Controls Posted Performance Results Paperless Production Order and Inventory Tracking Postponement
Data warehouse, report writing, real time data base and EI systems Electronic dispatch and data collection. Allow customer access to production status and inventories using internet technologies and web site features. Postponement (delayed dierentiation) is a supply chain concept where a product is kept as long as possible in a generic state. Dierentiation of the generic product into a specic end-product is shifted closer to the consumer by postponing identify changes, such as assembly or packaging, to the last possible supply chain location. Electronic batch recording/conguration
Accurate and Low Cost Batch/ Conguration Records for Warranty and Regulatory Tracking
3.3.3
M1
Scheduled Receipts S1.1, S2.1, S3.3 Information Feedback M1.2, M1.3, M1.4, M1.5, M1.6, M2.2, M2.3, M2.4, M2.5, M2.6, M3.3, M3.4, M3.5, M3.6, M3.7, Equipment and Facilities Schedules and Plans EM.5 Production Plans P3.4 Preventative Maintenance and Calibration Schedule EM.5
! M1.1 !
Production Schedule P3.2, S1.1, S2.1, S3.3, M1.2, M2.2, M3.3, D1.3, D1.8, D2.3, D2.9, D3.3, D3.9, D4.2
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 WIP Location Rules EM.6 WIP Handling Rules, Move Information and Methods EM.4
! M1.2 !
Information Feedback M1.1, M2.1, M3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Product Location Information EM.6 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6
M1.3 !
A
Information Feedback M1.1, M2.1, M3.2
M1.4 !
Production Plans P3.4 Delivery Plans P4.4
! M1.5 !
M1.6 !
A
Information Feedback M1.1, M2.1, M3.2 Finished Product Release D1.8, D2.9, D3.9, D4.2
Waste Produced M1.3
! M1.7
3.3.4
M1.1
Schedule Production Activities
Given plans for the production of specic parts, products, or formulations in specied quantities and planned availability of required sourced products, the scheduling of the operations to be performed in accordance with these plans. Scheduling includes sequencing, and, depending on the factory layout, any standards for setup and run. In general, intermediate production activities are coordinated prior to the scheduling of the operations to be performed in producing a nished product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Cross Training/Certication Additional Capacity for Overow Demand Real Time Feedback from Production, Raw Materials, and Finished Goods Inventory and Test Activities Utilize o-peak shifts Schedule air emissions after sunset Maintain Data and System Integrity by Ensuring Production Data, Inventory Levels, and Schedule Requirements Are 99+% Accurate Schedule Minimizes Changeover Costs between Products Schedule Includes Preventative Maintenance Program Drum-Buer-Rope Scheduling Technique Schedule high energy consumption at night Metric Schedule Achievement Schedule Production Activities Cycle Time None Identied Peak Time Energy Use, Cost to Schedule Production Activities Capacity Utilization Description/Denition HR/certication support Outsource manufacturing and work force augmentation providers connected to production schedules via the internet. Allow dynamic re-synchronization of MAKE activities by tying in real time status information to scheduler.
Utilize o-peak shifts for production workers (e.g.,shift 1 = 11:0019:00) Schedule air emission emitting activities after sunset Detailed production model that synchronizes PLAN and MAKE activities in real time.
Algorithms that manage set up times/costs, cleaning times, and ideal job sequences (e.g., color sequencing light to dark) Interface between maintenance management system and scheduling system (DBR, also referred to as Synchronous Manufacturing or Constraint Management) A technique used to manage resources to maximize throughput. Schedule electricity consuming (large amounts) activities from sunset to sunrise
3.3.5
M1.1
Best Practices cont. Schedule Reects Current Plant Status (Equipment Availability, Other Jobs and Resource Availability) On Line Produce Products to Unique Customer Requirements Provide Scheduling Output Back to Material and Labor Planning Systems Demand-Pull Manufacturing, Including Active Reduction of Manufacturing Systems Time and WIP Through the Use of DemandPull Mechanisms and Visual Controls Schedule Optimizes Use of Shared Resources Such as Tooling and Production Equipment Description/Denition cont. Schedule undated by on line reporting and status systems and re-sequence activities
Order entry specications linked to manufacturing order Allow dynamic re-synchronization of MAKE activities by tying in real time status information to scheduler Support of demand-pull mechanisms (Kanban, replenishment signals, etc.) based on rate schedules and user-dened minimum/maximum trigger points
Scheduling utilizing optimization techniques Required production resources included in routing/process instructions
Inputs
Scheduled Receipts S1.1, S2.1, S3.3 Information Feedback M1.2, M1.3, M1.4, M1.5, M1.6, M2.2, M2.3, M2.4, M2.5, M2.6, M3.3, M3.4, M3.5, M3.6, M3.7, Equipment and Facilities Schedules and Plans EM.5 Production Plans P3.4 Preventative Maintenance and Calibration Schedule EM.5
Outputs
> M1.1
> P3.2, S1.1, S2.1, S3.3, M1.2, M2.2, M3.3, D1.3, D1.8, D2.3, D2.9,
D3.3, D3.9, D4.2
Production Schedule
3.3.6
M1.2
Issue Material
The selection and physical movement of sourced/in-process product (e.g., raw materials, fabricated components, subassemblies, required ingredients or intermediate formulations) from a stocking location (e.g., stockroom, a location on the production oor, a supplier) to a specic point of use location. Issuing product includes the corresponding system transaction. The Bill of Materials/routing information or recipe/production instructions will determine the products to be issued to support the production operation(s).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied Issue Material Cycle Time None Identied Quantity per shipment, Cost to Issue Material, % of vehicle fuel derived from alternative fuels Packaging as % of total material Description/Denition Use of safety stock algorithms to minimize stock levels.
Supply Chain Asset Management Best Practices Strategic Safety Stock of Selected Materials, Items, or Subassemblies to Decouple Sourced Product Issuance Cycle Time from Supplier Lead Time Utilize high eciency vehicles Utilize o-peak shifts Back Flush Material at Order Completion Complete Lot History Demand-Pull Mechanisms; Kanban Replenishment Signals from Stockroom, Intermediate Products, or Subassembly Area Supplier Delivery to Production Process at Point of Use Utilize alternative fuel vehicles Implement pollution prevention program Electronic Material Move Transactions
Utilize high fuel eciency vehicles Utilize o-peak shifts for production workers (e.g.,shift 1 = 11:0019:00) Flexible back ush logic Inventory by lot of sourced/in-process or discrete order /usage reporting by lot or discrete order None identied
EDI link to suppliers sales order and inventory systems Utilize alternative fuel vehicles Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Automated process control and/or barcode data collection
3.3.7
M1.2
Inputs
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 WIP Location Rules EM.6 WIP Handling Rules, Move Information and Methods EM.4
Outputs
> M1.2
>
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Product Location Information EM.6 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6
3.3.8
M1.3
Produce and Test
The series of activities performed upon sourced/in-process product to convert it from the raw or semi-nished state to a state of completion and greater value. The processes associated with the validation of product performance to ensure conformance to dened specications and requirements.
Performance Attributes Supply Chain Reliability Metric Warranty Costs, Yield Variability, Warranty and Returns, Fill Rate, Yield Produce and Test Cycle Time, Asset Turns None Identied NPDES permitted water euent, Hazardous waste generated at warehousing facilities as % of total waste generated, Air emissions, Energy consumption, Cost to Produce and Test, % of solid waste consisting of packaging material, Waste produced as % of product produced % of products consisting of previously used components, Capacity Utilization, Hazardous materials used during production process as a % of all materials, % of production materials reused Description/Denition Electronic data collection of employee actions and sourced/in-process product lot used Implement an EMS Electronic collection of quality data and on-line SPC. Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing None identied Examples would be TQM, Six Sigma. Automatic download of production equipment with batch recipes/part programs
Best Practices Maintain Accurate Lot/Batch History Information Implement an EMS Real Time quality control techniques Implement pollution prevention program Authorize Each Operation to Assess the Quality of the Previous Operations Provide Continuous Formal Training to Employees Reduce Chances of Operator Error
3.3.9
M1.3
Best Practices cont. Accurate and Approved Process Plans/ Specications Paperless Production Control Reduce Non-Value Added Paperwork While Still Measuring Process Metrics Reduce Non-Value Added Activities, Including Queue, Move, and Set-Up Times Measuring Process Metrics and Feedback to Operators Benchmark practices Just-In-Time Demand Flow Techniques Accurate and Low Cost Batch/ Conguration Records for Warranty and Regulatory Tracking Real Time Statistical Control Techniques Up-to-Date Shop Packet/Specications Provide environmental training Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages Description/Denition cont. Electronic document management Electronic dispatch of operations Electronic data collection of completion, quality, lot tractability, scrap, and labor data Use principals of Lean Manufacturing.
Electronic data collection of completion, quality, scrap, labor and equipment data and dissemination of information on factory oor Benchmark practices of other rms Demand-pull mechanisms Electronic batch recording/conguration
Electronic collection of defect data and on-line SPC. Electronic work instructions Provide environmental training to all employees Machine productivity and downtime monitoring
Inputs
None Identi ed
> M1.3
Feedback > InformationM3.2 M1.1, M2.1,
Outputs
3.3.10
M1.4
Package
The series of activities that containerize completed products for storage or sale to end-users. Within certain industries, packaging may include cleaning or sterilization.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric Warranty Costs, Warranty and Returns Asset Turns, Package Cycle Time None Identied % packaging material that is recyclable/reusable, % packaging material consisting of post-consumer recycled content, % of excess packaging per unit, Packaging material re-use, Scrap packaging expense, % packaging material that is biodegradable, Cost to Package Capacity Utilization Description/Denition Retrieve packaging after installation for reuse None identied
Supply Chain Asset Management Best Practices Retrieve packaging after installation Postponement and Pre-Kitting Of Accessories into Modular Packages that Allow Flexibility While Maintaining Control Up-to-Date Shop Packet/ Specication for Each Unique Production Event/Demand Paperless Production Control Accurate and Low Cost Batch/ Conguration Records for Warranty and Regulatory Tracking Minimize Operator Induced Errors Maximize Container Loading Bulk Packaging Accurate and Approved Process Plans, Routings, Specications and Procedures
Electronic Work Instructions
Electronic dispatch of operations Electronic batch recording/conguration
Automatic download of production equipment with setup parameters Graphical display of setup, changeover, or layout Re-design container shapes to minimize material used but retain amount of product stored Package larger groups of items in a single package (bulk) Electronic document management
3.3.11
M1.4
Best Practices cont. Reduce Non-Value Added Paperwork While Still Measuring Process Metrics Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages Packaging Operation is an Integral Part of the Overall Production Process Automatic Label and Seal Verication Use multi-purpose packaging Use recyclable packaging Description/Denition cont. Electronic data collection of completion, quality, lot tractability, scrap, and labor data Machine productivity and downtime monitoring
None identied
Automatic interface to inspection systems Use multi-purpose packaging that can be used by customer Use recyclable packaging
Inputs
None Identi ed
> M1.4
> Information Feedback

M1.1, M2.1, M3.2
Outputs
3.3.12
M1.5
Stage Product
The movement of packaged products into a temporary holding location to await movement to a nished goods location. Products that are made to order may remain in the holding location to await shipment per the associated customer order. The movement to nished goods is part of the Deliver process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Electronic Material Move Transactions Direct Ship from Factory to Customer/Channel Metric None Identied Stage Finished Product Cycle Time None Identied Cost to Stage Finished Product None Identied Description/Denition Automated process control and/or barcode data collection Share production status with customers and transportation providers via web-based tools. Auto-Tendering for direct ship utilizing EDI/XML protocols.
Inputs
> M1.5

M1.1, M2.1, M3.2
Outputs
3.3.13
M1.6
Release Product to Deliver
Activities associated with post-production documentation, testing, or certication required prior to delivery of nished product to customer. Examples include assembly of batch records for regulatory agencies, laboratory tests for potency or purity, creating certicate of analysis, and sign-o by the quality organization.
Performance Attributes Supply Chain Reliability Metric # of complaints regarding missing environmental documentation, # of recordkeeping related NOVs None Identied None Identied Cost to Release Finished Product to Deliver None Identied Description/Denition Electronic batch records Ensure all required environmental documentation is obtained Electronic batch records linked to process plans/recipes and exceptions agged Implement hazardous materials pharmacy system Include supplier environmental information in addition to product environmental information Interface between production system and LIMS
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Accurate and Low Cost Batch records for Regulatory Compliance Ensure environmental documentation Review Batch Records by Exception Implement HAZMAT pharmacy system Include supplier environmental information Automated Notication of Laboratory Regarding Sample Availability Implement an EMS
Implement an EMS
Outputs Inputs
None Identi ed
> M1.6
>
Information Feedback M1.1, M2.1, M3.2 Finished Product Release D1.8, D2.9, D3.9, D4.2
3.3.14
M1.7
Waste Disposal
Activities associated with collecting and managing waste produced during the produce and test process including scrap material and non-conforming product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Daily HAZMAT inspection Waste accumulation Envirnomental Meanagement System (EMS) Storm water prevention plans Metric Reportable Release Incidents Waste Processing Error Waste accumulation time Waste storage capacity utilization Waste storage costs as % of total Make costs Hazardous waste as % of total waste Recyclable waste as % of total waste Description/Denition Daily inspection of any hazardous waste storage areas EMS covering waste accumulation processes Storm water prevention and spill control plans for waste accumulation areas
Inputs
Waste Produced M1.3
> M1.7
> None Identi ed
Outputs
3.3.15
M2
Make-to-Order
The process of manufacturing in a make-to-order environment adds value to products through mixing, separating, forming, machining, and chemical processes for a specic customer order. Products are completed, built or congured only in response to a customer order, the customer order reference is attached to the production order, attached to or marked on the product upon completion of the make process and referenced when transferring the product to Deliver. The product is identiable throughout the Make process, as made for a specic customer order. Examples of alternative or related names for Maketo-Order are: Build-to-Order (BTO), Assemble-to-Order (ATO), Congure-to-Order (CTO), and postponement.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric Yield, Perfect Order Fulllment Make Cycle Time Downside Make Adaptability, Upside Make Adaptability, Upside Make Flexibility Energy Costs, Cost of Goods Sold, Cost to Make Inventory Days of Supply (WIP), Return on Working Capital, Cash-To-Cash Cycle Time, Return on Supply Chain Fixed Assets Description/Denition Electronic document management that maintains current Standard Operating Procedures (SOP) Order entry specications linked to manufacturing order Electronic batch recording/conguration
Supply Chain Costs
Best Practices Accurate and Approved Work Instructions/Process Plans Produce Products to Unique Customer Requirements Accurate and Low Cost Batch/ Conguration Records for Warranty and Regulatory Tracking Postponement
Postponement (delayed dierentiation) is a supply chain concept where a product is kept as long as possible in a generic state. Dierentiation of the generic product into a specic end-product is shifted closer to the consumer by postponing identify changes, such as assembly or packaging, to the last possible supply chain location. Examples would be TQM, Six Sigma.
Provide Continuous Formal Training to Employees
3.3.16
M2
Best Practices cont. Delivery Schedules Are Collaboratively Developed with Customers Paperless Order Tracking and Customer Visibility of Orders Posted Performance Results Organize to Enhance Flexibility: Few Job Classications, SelfDirected Work Force, Flat Management Structure, CrossFunctional Work Teams Link Individual Performance to Organizational and Divisional Goals Production Level Loading Cellular and Demand Pull Manufacturing Description/Denition cont. Web-based access to plant scheduling status, collaborative data-sharing environment. Electronic dispatch and data collection with external interface to internet. Data warehouse, report writing, real time data base and EI systems Support for modular skills inventory with links to training databases, compensations systems, and operator instructions
None identied Capacity planning Support for cellular and demand pull manufacturing execution
3.3.17
M2
Production Plans P3.4 Equipment and Facilities Schedules and Plans EM.5 Preventative Maintenance and Calibration Schedule EM.5 Information Feedback M1.2, M1.3, M1.4, M1.5, M1.6, M2.2, M2.3, M2.4, M2.5, M2.6, M3.3, M3.4, M3.5, M3.6, M3.7 Scheduled Receipts S1.1, S2.1, S3.3
! M2.1 !
WIP Handling Rules, Move Information and Methods EM.4 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 WIP Location Rules EM.6
! M2.2 !
Production Schedule M1.1, M2.1, M2.2, M3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Source Execution Data S2.1 Product Location Information EM.6 Information Feedback M1.1, M2.1, M3.2
M2.3 !
A
M2.4 !
! M2.5 !
M2.6 !
A
Waste Produced M2.3
! M2.7
3.3.18
M2.1
Given plans for the production of specic parts, products, or formulations in specic quantities and planned availability of required sourced products, the scheduling of the operations to be preformed in accordance with these plans. Scheduling includes sequencing, and, depending on the factory layout, any standards for setup and run. In general intermediate production activities are coordinated prior to the scheduling of the operations to be preformed in producing a nished product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Cross Training/Certication Schedule Optimizes Use of Shared Resources Such as Tooling and Production Equipment Produce Products to Unique Customer Requirements Demand-Pull Manufacturing, Including Active Reduction of Manufacturing Systems Time and WIP Through the Use of DemandPull Mechanisms and Visual Controls Drum-Buer-Rope Scheduling Technique Maintain Data and System Integrity by Ensuring Production Data, Inventory Levels, and Schedule Requirements Are 99+% Accurate Schedule high energy consumption at night Schedule air emissions after sunset Demand Pull Mechanisms Metric Schedule Achievement Schedule Production Activities Cycle Time None Identied Cost to Schedule Production Activities, Peak Time Energy Use Capacity Utilization Description/Denition HR/certication support Scheduling utilizing optimization techniques Required production resources included in routing/process instructions Order entry specications linked to manufacturing order Support of demand-pull mechanisms (Kanban, replenishment signals, etc.) based on rate schedules and user-dened minimum/maximum trigger points
(DBR, also referred to as Synchronous Manufacturing or Constraint Management) A technique used to manage resources to maximize throughput. Detailed production model that synchronizes PLAN and MAKE activities in real time.
Schedule electricity consuming (large amounts) activities from sunset to sunrise Schedule air emission emitting activities after sunset Repetitive scheduling and sequencing
3.3.19
M2.1
Inputs
Production Plans P3.4 Equipment and Facilities Schedules and Plans EM.5 Preventative Maintenance and Calibration Schedule EM.5 Information Feedback M1.2, M1.3, M1.4, M1.5, M1.6, M2.2, M2.3, M2.4, M2.5, M2.6, M3.3, M3.4, M3.5, M3.6, M3.7 Scheduled Receipts S1.1, S2.1, S3.3
Outputs
> M2.1
> Production ScheduleM1.2, M2.2, P3.2, S1.1, S2.1, S3.3,

M3.3, D1.3, D1.8, D2.3, D2.9, D3.3, D3.9, D4.2
3.3.20
M2.2
Issue Sourced/ In-Process Product
The selection and physical movement of sourced/in-process products (e.g., raw materials, fabricated components, subassemblies, required ingredients or intermediate formulations) from a stocking location (e.g., stockroom, a location on the production oor, a supplier) to a specic point of use location. Issuing product includes the corresponding system transaction. The Bill of Materials/routing information or recipe/production instructions will determine the products to be issued to support the production operation(s).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied Issue Sourced/In-Process Product Cycle Time None Identied % of vehicle fuel derived from alternative fuels, Cost to Issue Sourced/In-Process Product, Quantity per shipment Packaging as % of total material Description/Denition Inventory by lot of sourced/in-process or discrete order /usage reporting by lot or discrete order EDI link to suppliers sales order and inventory systems Utilize maintenance free batteries in warehouse/short haul vehicles Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Utilize alternative fuel vehicles Automated process control and/or barcode data collection None identied
Supply Chain Asset Management Best Practices Complete Lot History Supplier Delivery to Production Process at Point of Use Utilize maintenance free batteries Implement pollution prevention program Utilize alternative fuel vehicles Electronic Material Move Transactions Demand-Pull Mechanisms; Kanban Replenishment Signals from Stockroom, Intermediate Products, or Subassembly Area Utilize high eciency vehicles Back Flush Material at Order Completion
Utilize high fuel eciency vehicles Flexible back ush logic
3.3.21
M2.2
Outputs Inputs
WIP Handling Rules, Move Information and Methods EM.4 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 WIP Location Rules EM.6 Production Schedule M1.1, M2.1, M2.2, M3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
> M2.2
Signal > ReplenishmentS2.4, S3.3, S3.6 S1.1, S1.4, S2.1, Source Execution Data S2.1 Product Location Information EM.6 Information Feedback M1.1, M2.1, M3.2
3.3.22
M2.3
Produce and Test
Performance Attributes Supply Chain Reliability Metric Warranty Costs, Yield, Yield Variability Produce and Test Cycle Time, Asset Turns None Identied % of solid waste consisting of packaging material, NPDES permitted water euent, Energy consumption, Air emissions, Cost to Produce and Test, Waste produced as % of product produced % of production materials reused, Hazardous materials used during production process as a % of all materials, Capacity Utilization, % of products consisting of previously used components Description/Denition Automatic download of production equipment with batch recipes/part programs Use principals of Lean Manufacturing.
Best Practices Reduce Chances of Operator Error Reduce Non-Value Added Activities, Including Queue, Move, and Set-Up Times Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages Accurate and Low Cost Batch/ Conguration Records for Warranty and Regulatory Tracking Implement pollution prevention program Paperless Production Control Benchmark practices
Machine productivity and downtime monitoring
Electronic batch recording/conguration
Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Electronic dispatch of operations Benchmark practices of other rms
3.3.23
M2.3
Best Practices cont. Accurate and Approved Process Plans/Specications Authorize Each Operation to Assess the Quality of the Previous Operations Maintain Accurate Lot/Batch History Information Just-In-Time Demand Flow Techniques Up-to-Date Shop Packet/ Specications Provide environmental training Implement an EMS Real Time quality control techniques Real Time Statistical Control Techniques Description/Denition cont. Electronic document management None identied
Electronic data collection of employee actions and sourced/inprocess product lot used Demand-pull mechanisms Electronic work instructions Provide environmental training to all employees Implement an EMS Electronic collection of quality data and on-line SPC. Electronic collection of defect data and on-line SPC.
Inputs
None Identi ed
> M2.3
Outputs
3.3.24
M2.4
Package
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric Warranty Costs Asset Turns, Package Cycle Time None Identied % of excess packaging per unit, Cost to Package, % packaging material that is recyclable/reusable, % packaging material consisting of post-consumer recycled content, Scrap packaging expense, % packaging material that is biodegradable % of packaging/shipping materials reused internally, Capacity Utilization Description/Denition Automatic download of production equipment with setup parameters Graphical display of setup, changeover, or layout Retrieve packaging after installation for reuse Electronic document management None identied
Supply Chain Asset Management Best Practices Minimize Operator Induced Errors Retrieve packaging after installation Accurate and Approved Process Plans/Specications Postponement and Pre-Kitting Of Accessories into Modular Packages that Allow Flexibility While Maintaining Control Up-to-Date Shop Packet/ Specication for Each Unique Production Event/Demand Automatic Label and Seal Verication Bulk Packaging Reduce Non-Value Added Paperwork While Still Measuring Process Metrics Maximize Container Loading Use multi-purpose packaging
Electronic Work Instructions
Automatic interface to inspection systems Package larger groups of items in a single package (bulk) Electronic data collection of completion, quality, lot tractability, scrap, and labor data Re-design container shapes to minimize material used but retain amount of product stored Use multi-purpose packaging that can be used by customer
3.3.25
M2.4
Best Practices cont. Accurate and Low Cost Batch/ Conguration Records for Warranty and Regulatory Tracking Packaging Operation is an Integral Part of the Overall Production Process Use recyclable packaging Paperless Production Control Description/Denition cont. Electronic batch recording/conguration
None identied
Use recyclable packaging Electronic dispatch of operations
Inputs
None Identi ed
> M2.4

M1.1, M2.1, M3.2
Outputs
3.3.26
M2.5
Stage Finished Product
The movement of packaged products into a temporary holding location to await movement to a nished goods location. Products that are made to order may remain in the holding location to await shipment per the associated customer order. The actual move transaction is part of the Deliver process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Direct Ship from Factory to Customer/Channel Electronic Material Move Transactions Metric None Identied Stage Finished Product Cycle Time None Identied Cost to Stage Finished Product None Identied Description/Denition Share production status with customers and transportation providers via web-based tools. Auto-Tendering for direct ship utilizing EDI/XML protocols. Automated process control and/or barcode data collection
Inputs
> M2.5
Outputs
3.3.27
M2.6
Release Finished Product to Deliver
Performance Attributes Supply Chain Reliability Metric % of products with proper environmental labeling (if required), % of products meeting specied environmental performance requirements Release Finished Product to Deliver Cycle Time None Identied Cost to Release Finished Product to Deliver None Identied Description/Denition Interface between production system and LIMS
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automated Notication of Laboratory Regarding Sample Availability Implement an EMS Accurate and Low Cost Batch records for Regulatory Compliance Review Batch Records by Exception Implement HAZMAT pharmacy system
Implement an EMS Electronic batch records Electronic batch records linked to process plans/recipes and exceptions agged Implement hazardous materials pharmacy system
Outputs Inputs
None Identi ed
> M2.6
>
Finished Product Release D1.8, D2.9, D3.9, D4.2 Information Feedback M1.1, M2.1, M3.2
3.3.28
M2.7
Waste Disposal
Performance Attributes Reliability Responsiveness Agility Costs Asset Best Practices Daily HAZMAT inspection Waste accumulation Environmental Management System (EMS) Implement pollution prevention program Inputs Waste Produced- From M2.3 Waste produced during the produce and test process including scrap material and non-conforming product. Metric Reportable Release Incidents Waste Processing Errors Waste accumulation time Waste storage capacity utilization Waste storage costs as % of Make costs Hazardous waste as % of total waste Recyclable waste as % of total waste Description/Denition Daily inspection of any hazardous waste storage areas EMS covering waste accumulation processes Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing.
Inputs
Waste Produced M2.3
> M2.7
> None Identi ed
Outputs
3.3.29
M3
Engineer-to-Order
The process of developing, designing, validating, and ultimately using a manufacturing process to produce products or services based on the requirements of a specic customer. In general Engineer-to-Order requires that work instructions may need to be dened or rened and material routing instructions may need to be added or modied. An example of an alternative or related name for Make Engineer-to-Order is: Design-to-Order (DTO).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric Yield Order Fulllment Cycle Time, Make Cycle Time Upside Make Adaptability, Downside Make Adaptability, Upside Make Flexibility Cost to Make, Cost of Goods Sold Cash-To-Cash Cycle Time, Return on Working Capital, Inventory Days of Supply (WIP), Return on Supply Chain Fixed Assets Description/Denition Web-based access to plant scheduling status, collaborative data-sharing environment. On-line design tools facilitated by internet connections. Support for modular skills inventory with links to training databases, compensations systems, and operator instructions
Best Practices Delivery Schedules Are Collaboratively Developed with Customers Product Design Collaboration with Customers Organize to Enhance Flexibility: Few Job Classications, Self-Directed Work Force, Flat Management Structure, Cross-Functional Work Teams Posted Performance Results Cellular Manufacturing Demand-Pull Manufacturing, Including Active Reduction of Manufacturing Systems Time and WIP Through the Use of DemandPull Mechanisms and Visual Controls Paperless Order Tracking and Customer Visibility of Orders
Data warehouse, report writing, real time data base and EI systems Manufacturing is broken into work cells Support of demand-pull mechanisms (Kanban, replenishment signals, etc.) based on rate schedules and user-dened minimum/maximum trigger points
Electronic dispatch and data collection with external interface to internet.

3.3.30
M3
Order Information D3.3 Engineering Design
! M3.1 !
Methods, Procedures, Processes M3.2
Preventative Maintenance and Calibration Schedule EM.5 Scheduled Receipts S1.1, S2.1, S3.3 Information Feedback M1.2, M1.3, M1.4, M1.5, M1.6, M2.2, M2.3, M2.4, M2.5, M2.6, M3.3, M3.4, M3.5, M3.6, M3.7 Methods, Procedures, Processes M3.1 Equipment and Facilities Schedules and Plans EM.5 Production Plans P3.4
! M3.2 !
WIP Location Rules EM.6 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 WIP Handling Rules, Move Information and Methods EM.4 Production Schedule M1.1, M2.1, M2.2, M3.2
! M3.3 !
Information Feedback M1.1, M2.1, M3.2 Product Location Information EM.6 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
M3.4 !
A
M3.5 !
Delivery Plans P4.4 Production Plans P3.4
! M3.6 !
M3.7 !
A
Waste Produced M3.4
! M3.8
3.3.31
M3.1
Finalize Production Engineering
Engineering activities required after acceptance of order, but before product can be produced. May include generation and delivery of nal drawings, specications, formulas, part programs, etc. In general, the last step in the completion of any preliminary engineering work done as part of the quotation process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automated Conversion of Engineering Drawings into Product Specications Automated Conguration Management Metric None Identied Finalize Production Engineering Cycle Time None Identied Cost to Finalize Production Engineering None Identied Description/Denition None identied
Conguration
Inputs
Order Information D3.3 Engineering Design
> M3.1
> Methods, Procedures, Processes

M3.2
Outputs
3.3.32
M3.2
Given plans for the production of specic parts, products, or formulations in specied quantities and planned availability of required sourced products, the scheduling of the operations to be performed in accordance with these plans. Scheduling includes sequencing, and, depending on the factory layout, any standards for setup and run. In general, intermediate production activities are coordinated prior to the scheduling of the operations to be performed in producing a nished product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Additional Capacity for Overow Demand Utilize o-peak shifts Schedule Minimizes Changeover Costs between Products Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages Schedule high energy consumption at night Schedule Optimizes Use of Shared Resources Such as Tooling and Production Equipment Drum-Buer-Rope Scheduling Technique Maximize Data Integrity and System Accuracy by Ensuring 99%+ Accuracy of BOM Conguration, Inventory Levels, and Schedule Requirements Cellular Manufacturing Best Practices cont. Metric Schedule Achievement Schedule Production Activities Cycle Time None Identied Cost to Schedule Production Activities Capacity Utilization Description/Denition Outsource manufacturing and work force augmentation providers connected to production schedules via the internet. Utilize o-peak shifts for production workers (e.g.,shift 1 = 11:0019:00) Algorithms that manage set up times/costs, cleaning times, and ideal job sequences (e.g., color sequencing light to dark) Machine productivity and downtime monitoring
Schedule electricity consuming (large amounts) activities from sunset to sunrise Scheduling utilizing optimization techniques Required production resources included in routing/process instructions (DBR, also referred to as Synchronous Manufacturing or Constraint Management) A technique used to manage resources to maximize throughput. None identied
Manufacturing is broken into work cells Description/Denition cont.
3.3.33
M3.2
Build Subassemblies to Forecast at Highest Generic Level in Bill of Material; Maintain Flexibility While Minimizing Cycle Time and Inventory Position Schedule Includes Preventative Maintenance Program Schedule air emissions after sunset Schedule Reects Current Plant Status (Equipment Availability, Other Jobs and Resource Availability) On Line Demand Pull Mechanisms Cross Training/Certication None identied
Interface between maintenance management system and scheduling system Schedule air emission emitting activities after sunset Schedule undated by on line reporting and status systems and re-sequence activities
Repetitive scheduling and sequencing HR/certication support
Inputs
Preventative Maintenance and Calibration Schedule EM.5 Scheduled Receipts S1.1, S2.1, S3.3 Information Feedback M1.2, M1.3, M1.4, M1.5, M1.6, M2.2, M2.3, M2.4, M2.5, M2.6, M3.3, M3.4, M3.5, M3.6, M3.7 Methods, Procedures, Processes M3.1 Equipment and Facilities Schedules and Plans EM.5 Production Plans P3.4
Outputs
> M3.2
>
3.3.34
M3.3
Issue Sourced/ In-Process Product
The selection and physical movement of sourced/in-process products (e.g., raw materials, fabricated components, subassemblies, required ingredients or intermediate formulations) from a stocking location (e.g., stockroom, a location on the production oor, a supplier) to a specic point of use location. Issuing material includes the corresponding system transaction. The Bill of Materials/routing information or recipe/production instructions will determine the materials to be issued to support the production operation(s).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied Issue Sourced/In-Process Product Cycle Time None Identied Cost to Issue Sourced/In-Process Product, % of vehicle fuel derived from alternative fuels, Quantity per shipment Packaging as % of total material Description/Denition Utilize alternative fuel vehicles None identied
Supply Chain Asset Management Best Practices Utilize alternative fuel vehicles Demand-Pull Mechanisms; Kanban Replenishment Signals from Stockroom, Intermediate Products, or Subassembly Area Electronic Material Move Transactions Back Flush Material at Order Completion Utilize high eciency vehicles Supplier Delivery to Production Process at Point of Use Implement pollution prevention program Two-Bin Floor Stock Located at Work Center for B And C Components - Controlled by Operators and Replenished When One Bin is Empty
Automated process control and/or barcode data collection Flexible back ush logic Utilize high fuel eciency vehicles EDI link to suppliers sales order and inventory systems Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing None identied
3.3.35
M3.3
Inputs
WIP Location Rules EM.6 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 WIP Handling Rules, Move Information and Methods EM.4 Production Schedule M1.1, M2.1, M2.2, M3.2
Outputs
> M3.3
> Replenishment Signal
Product Location Information EM.6 S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
3.3.36
M3.4
Produce and Test
Performance Attributes Supply Chain Reliability Metric Yield Variability, Yield, Warranty Costs Produce and Test Cycle Time, Asset Turns None Identied Hazardous waste generated at warehousing facilities as % of total waste generated, Air emissions, NPDES permitted water euent, Cost to Produce and Test, Energy consumption, % of solid waste consisting of packaging material Hazardous materials used during production process as a % of all materials, % of production materials reused, % of products consisting of previously used components Description/Denition None Identied Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Machine productivity and downtime monitoring
Best Practices Implement Employee Involvement Programs Implement pollution prevention program Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages Paperless Production Control Provide Continuous Formal Training to Employees Provide environmental training Link Individual Performance to Organizational and Divisional Goals
Electronic dispatch of operations Examples would be TQM, Six Sigma. Provide environmental training to all employees None identied
3.3.37
M3.4
Real Time quality control techniques Best Practices cont. Authorize Each Operation to Assess the Quality of the Previous Operations Real Time Statistical Control Techniques Reduce Non-Value Added Activities, Including Queue, Move, and Set-Up Times Just-In-Time Demand Flow Techniques Benchmark practices Implement an EMS Maintain Accurate Lot/Batch History Information Up-to-Date Shop Packet/ Specications Electronic collection of quality data and on-line SPC. Description/Denition cont. None identied
Electronic collection of defect data and on-line SPC. Use principals of Lean Manufacturing.
Demand-pull mechanisms Benchmark practices of other rms Implement an EMS Electronic data collection of employee actions and sourced/inprocess product lot used Electronic work instructions
Inputs
None Identi ed
> M3.4
Outputs
3.3.38
M3.5
Package
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric Warranty Costs Package Cycle Time, Asset Turns None Identied Packaging material re-use, % packaging material that is recyclable/reusable, Scrap packaging expense, Cost to Package, % packaging material that is biodegradable, % packaging material consisting of post-consumer recycled content, % of excess packaging per unit Capacity Utilization Description/Denition None identied
Supply Chain Asset Management Best Practices Postponement and Pre-Kitting Of Accessories into Modular Packages that Allow Flexibility While Maintaining Control Use recyclable packaging Bulk Packaging Paperless Production Control Retrieve packaging after installation Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages Maximize Container Loading Packaging Operation is an Integral Part of the Overall Production Process Automatic Label and Seal Verication Use multi-purpose packaging
Use recyclable packaging Package larger groups of items in a single package (bulk) Electronic dispatch of operations Retrieve packaging after installation for reuse Machine productivity and downtime monitoring
Re-design container shapes to minimize material used but retain amount of product stored None identied
Automatic interface to inspection systems Use multi-purpose packaging that can be used by customer
3.3.39
M3.5
Up-to-Date Shop Packet/ Specications Best Practices cont. Electronic data collection of completion, quality, lot trace ability, scrap, and labor data Minimize Operator Induced Errors Electronic work instructions Description/Denition cont. Reduce non-value added paperwork while still maintaining process metrics Automatic download of production equipment with setup parameters Graphical display of setup, changeover, or layout
Inputs
None Identi ed
> M3.5

M1.1, M2.1, M3.2
Outputs
3.3.40
M3.6
Stage Finished Product
The movement of packaged products into a temporary holding location to await movement to a nished goods location. Products that are made to order may remain in the holding location to await shipment per the associated customer order. The actual move transaction is part of the Deliver process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Direct Ship from Factory to Customer/Channel Electronic Material Move Transactions Metric None Identied Stage Finished Product Cycle Time None Identied Cost to Stage Finished Product None Identied Description/Denition Share production status with customers and transportation providers via web-based tools. Auto-Tendering for direct ship utilizing EDI/XML protocols. Automated process control and/or barcode data collection
Inputs
Delivery Plans P4.4 Production Plans P3.4
> M3.6
Outputs
3.3.41
M3.7
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Implement HAZMAT pharmacy system Implement an EMS Accurate and Low Cost Batch records for Regulatory Compliance Automated Notication of Laboratory Regarding Sample Availability Review Batch Records by Exception Metric None Identied Release Finished Product to Deliver Cycle Time None Identied Cost to Release Finished Product to Deliver None Identied Description/Denition Implement hazardous materials pharmacy system Implement an EMS Electronic batch records Interface between production system and LIMS
Electronic batch records linked to process plans/recipes and exceptions agged
Outputs Inputs
None Identi ed
> M3.7
>
3.3.42
M3.8
Waste Disposal
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Daily HAZMAT inspection Waste accumulation Environmental Management System (EMS) Storm water prevention plans Metric Reportable Release Incidents Waste Processing Error Waste accumulation time Waste storage capacity utilization Waste storage costs as % of total Make costs Hazardous waste as % of total waste Recyclable waste as % of total waste Description/Denition Daily inspection of any hazardous waste storage areas EMS covering waste accumulation processes Storm water prevention and spill control plans for waste accumulation areas
Inputs
Waste Produced M3.4
> M3.8
> None Identi ed
Outputs
3.3.43
EM
EM: Enable Make
The collection of processes associated with managing and monitoring Make process data, performance and relationships.
Process Categories EM.1: Manage Production Rules The process of establishing, maintaining, and enforcing rules for managing production details in line with business strategy, goals, and objectives. Production details include part/ item master, bills of materials/formulas, routings, processes, equipment requirements, tooling, and other information specifying the method of production for a particular product. The process of developing and maintaining performance standards and analysis methods to compare actual production performance against the established standards. This process allows the development and implementation of a course of action to achieve targeted performance. The process of managing, collecting, maintaining, and communicating information to support MAKE planning and execution processes. The information to be managed includes production, order and process data. The process of establishing and maintaining limits or levels, replenishment models, ownership, product mix and stocking locations for In-Process Product (WIP). The process of specifying maintaining and dispositioning MAKEs capital assets to operate the supply chain production processes. This includes repair, alteration, calibration and other miscellaneous items to maintain production capabilities. The process of transporting In-Process Product (WIP). This includes management of the activities associated with in transit handling and movement of In-Process Product (WIP). The process of identifying and maintaining a network of intracompany production units that deliver specic semi-nished materials or product sets to the nal production site. The process of identifying and complying with regulatory documentation and process standards set by external entities (eg government) The process of managing Make risks within an overall supply Chain risk Program. This includes identifying and assessing make risks as well as and planning and implementing responses to Make risks. Make risks include potential events that could impact your ability to make on-time at a reasonable cost with good quality. The risks can occur internally within your organization, e.g. a matching breakdown or facility re, or externally, e.g. a hurricane, that impacts your ability to Make.
EM.4: Manage In-Process Products (WIP) EM.5: Manage Make Equipment and Facilities
EM.6: Manage Transportation (WIP)
EM.8: Manage Make Regulatory Environment EM.9: Manage Supply Chain Make Risk
3.3.44
EM
Business Plan Transportation Capacity EP.6 Corporate Objectives and Strategies Production Plans P3.4 Inventory Capacity Production Capacity EP.5 Product Design Business Plan Transportation Capacity EP.6 Corporate Objectives and Strategies Production Plans P3.4 Inventory Capacity Production Capacity EP.5 Product Design/Quality
! EM.1 ! ! EM.2 ! ! EM.3 ! ! EM.4 ! ! EM.5 ! ! EM.6 ! ! EM.7 ! ! EM.8 ! ! EM.9 !
Production Rules
Production Rules Production Quality & Policies Supply Chain Performance Metrics EP.2, ED.1, ED.5
Systems Capabilities Information Needed to Create and Maintain IT Information from Business Processes Information Needs Analysis
Reports, Information and Documents Information Infrastructure Plan
Capacity Requirements Production Orders Planned & Actual Reports Returned Product Information Incoming Product Information
WIP Handling Rules, Move Information and Methods EM.6, M1.2, M2.2, M3.3
Budgets Manufacturers Recommended Maintenance Schedules & Speci cations Equipment and Facilities Monitoring Information MRO Parts Availability ES.4 Production Plans P3.4 Production Quality and Policies Equipment and Facilities Replacement and Disposition Plans EM.5 Production Orders Planned & Actual Reports WIP Handling Rules, Move Information and Methods EM.4 Capacity Requirements Projected Delivery Requirements EM.7 Supplier Agreement ES.10, S3.2 Product Location Information M1.2, M2.2, M3.3
Equipment and Facilities Maintenance History Parts and Services Consumed ES.4, ES.5, ES.8 Equipment and Facilities Schedules and Plans M1.1, M2.1, M3.2 Equipment and Facilities Replacement and Disposition Plans P3.2, EM.6 Production Status EM.7 Preventative Maintenance and Calibration Schedule M1.1, M2.1, M3.2
WIP Move Information and Methods WIP Location Rules M1.2, M2.2, M3.3, D2.9 WIP Inventory Location S1.4, S2.4, S3.6
Planning Data EP.3 Production Status EM.5 Supply Chain Plans P1.4
Cost to Produce Internal Capacity Projected Delivery Requirements EM.6, ED.6
Equipment and Facilities Characteristics External Regulatory Information Corporate Objectives and Strategies Product Design/Claims
Conformance Rules Conformance Plan
3.3.45
EM.1
Manage Production Rules
The process of establishing, maintaining, and enforcing rules for managing production details in line with business strategy, goals, and objectives. Production details include part/ item master, bills of materials/formulas, routings, processes, equipment requirements, tooling, and other information specifying the method of production for a particular product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Attribute-Based Process Planning Automatic Generation / Conguration Of Tooling / Set-Up Instructions Design For Production Automated Engineering Specications Implement an EMS Automatic Notication When to Begin and When to Complete Genealogy Tracking Pre-Dened Manufacturing Design Rules Document Control Automated Links To Existing CAD & CAM Information On Line Access and Notication of Tooling and Equipment Information Electronic Documentation and Imaging Metric None Identied Manage Production Rules Cycle Time None Identied Cost to Manage Production Rules None Identied Description/Denition Computer aided process planning / recipe management Parametric driven (Group Technology - based) manufacturing design system Table of manufacturing capacities or design envelops (capacities; envelop sizes; tank, vessel or batch sizes) Automated Intelligence (Heuristic) - based engineering specications system Implement an EMS Workow/Groupware Where-used listing of as-planned vs. as-built documentation Libraries of manufacturing capabilities or design envelopes Control who can create, revise and access information Electronic hypertext or links to existing database of detail/ parts/setup sketches/drawings Delivery of tooling and equipment details drawings Graphical display of drawings, diagrams, recipes/formulas, specications, instructions, etc., to all users
3.3.46
EM.1
Inputs
Business Plan Transportation Capacity EP.6 Corporate Objectives and Strategies Production Plans P3.4 Inventory Capacity Production Capacity EP.5 Product Design
> EM.1
> ProductionOutputs Rules
3.3.47
EM.2
Manage Production Performance
The process of developing and maintaining performance standards and analysis methods to compare actual production performance against the established standards. This process allows the development and implementation of a course of action to achieve targeted performance.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Real Time Performance Measurement Reporting Systems Develop environmental performance standards. Periodic Review of Standards Implement an EMS Standards and Measurements Aligned to Maximize Supply Chain Performance Metric # of sta-related environmental violations Manage Production Performance Cycle Time None Identied Cost to Manage Production Performance None Identied Description/Denition Systems to collect production information online generate reports upon request by operators, and track progress against schedule and standards. Develop environmental performance standards. Process for establishing and maintaining review schedules Implement an EMS Internal/external benchmarking, industry standards, customer/supplier alignment agreements, visibility of key performance indicators
Inputs
Business Plan Transportation Capacity EP.6 Corporate Objectives and Strategies Production Plans P3.4 Inventory Capacity Production Capacity EP.5 Product Design/Quality
Inputs
Production Rules
> EM.2
> Supply Chain Performance

Metrics EP.2, ED.1, ED.5
Production Quality & Policies
3.3.48
EM.3
Manage MAKE Information
The process of managing, collecting, maintaining, and communicating information to support MAKE planning and execution processes. The information to be managed includes production, order and process data.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices On-Demand Access to Available to Promise (ATP), Production Schedules and Inventory Status by Internal Operations and Customers On-Demand Access of Production Information Metric None Identied Manage MAKE Information Cycle Time None Identied Cost to Manage MAKE Information None Identied Description/Denition None identied
Data Collection and Display Systems designed for ecient performance of value-added operations in production. This could include using PLC, Machine Interface, bar code, Radio Frequency Communication, Radio Frequency Identication, Magnetic Stripe, Smart Cards, etc., to enable data collection Enter, Process, and Deliver information about the manufacturing process to management using information systems that span the enterprise Include products environmental attributes information Historical trending, cause and eect analysis, and Key Performance Indicators Scheduling reviews of processes for possible improvements
Utilize Enterprise Information Systems Include products environmental attributes Continuous Improvement
Inputs
Systems Capabilities Information Needed to Create and Maintain IT Information from Business Processes Information Needs Analysis
Outputs
> EM.3
> Information Infrastructure

Plan
Reports, Information and Documents
3.3.49
EM.4
Manage In-Process Products (WIP)
The process of establishing and maintaining limits or levels, replenishment models, ownership, product mix and stocking locations for In-Process Product (WIP).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Optimize Packing Dunnage Control Metric None Identied Manage In-Process Products (WIP) Cycle Time None Identied Cost to Manage In-Process Products (WIP) None Identied Description/Denition No packing and unpacking time required. Recyclable or no containers where appropriate. No discarded material. System data eld to specify where the part / product shipping container should be removed. Best practice is to remove the dunnage as soon as possible unless part / product damage will result. Reuse of intermediate WIP containers for nished goods. The Statistical Test Count (STC) process is a method of validating inventory on-hand values by physically counting and reconciling a statistical sample of the entire inventory population. This sample is then extrapolated across the inventory population, which provides an indicative measure of entire inventory population. Furthermore, with extrapolation the net and gross percentage of error is determined. Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing WIP Storage Management System Ecient Space Utilization Implementing Pull Systems Tracking, genealogy Move high frequency used inventory close to point of use. For example, the system should provide the frequency of picks by part number so that high frequency picks can be moved to convenient locations or part pick quantities increased. Description/Denition cont.
Statistical Test Count
Implement pollution prevention program Minimizing In-Process Product (WIP) In-Process Product (WIP) Handling Rules Minimum Product Handling
Best Practices cont.
3.3.50
EM.4
Vendor Managed Inventory VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The onsite inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Part / WIP location by date received for those parts that must be stocked or staged in a holding area
First In - First Out
Inputs
Capacity Requirements Production Orders Planned & Actual Reports Returned Product Information Incoming Product Information
> EM.4
> WIP Handling Rules, Move Information and Methods

EM.6, M1.2, M2.2, M3.3
Outputs
3.3.51
EM.5
Manage MAKE Equipment and Facilities
The process of specifying maintaining and dispositioning MAKEs capital assets to operate the supply chain production processes. This includes repair, alteration, calibration and other miscellaneous items to maintain production capabilities.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied Manage MAKE Equipment and Facilities Cycle Time, Supply chain down time due to compliance issues None Identied Energy ecient upgrades, Cost to Manage MAKE Equipment and Facilities, Number of worker absences due to poor IAQ Actual Asset Life Maintenance Cost as % of Replacement Value, Equipment energy eciency Description/Denition Database for equipment to contain expected results of analysis, allow entry of test readings, and have capability of generating desired reports, which could highlight suggested actions based upon readings obtained, track maintenance completed, contain a help-le to be consulted Use non-toxic solvents for machinery cleaning Utilize non-toxic solvents and cleaning materials Changeover process ow element identication, instructional directions to conduct changeover, and measurement tool, which can be used to prioritize and track results of improvement eorts. Software to identify operational constraints to the MAKE processes to assist in directing resources toward bottleneck functional areas. Rules for deciding appropriate disposition. Outsourcing strategies including the use of Application Service Providers (ASPs), web-based maintenance/diagnostic assistance and MRO parts. E.D.I. linkage of Inventory Information System software to list checklist items, report results of audit & forward actions to be taken Utilize energy-star (or similar) equipment whenever possible
Supply Chain Asset Management Best Practices Predictive Maintenance Monitoring (Heat, Noise, Lubrication Composition & Vibration)
Use non-toxic solvents Utilize non-toxic materials Changeover Reduction / Continuous Improvement Program
Systematic Disposition Of Equipment Minimize Capital Assets Required and Maintenance Costs Supplier Managed Inventory of Parts Facility & Equipment Environmental / Safety Audit System Utilize energy-star (or similar) equipment
3.3.52
EM.5
Best Practices cont. Implement HAZMAT pharmacy system Factory Floor Electronic Decision Making Information System Total Preventative Maintenance Program Description/Denition cont. Implement hazardous materials pharmacy system Software to capture actual performance history / costs of operations with capability of predicting best cost action plans relating to maintaining equipment and facilities. Automatically generated TPM repair schedules integrated with MRP systems, electronic equipment repair history, parts listings, part stores inventory & reorder points, automatic store room parts purchases, Shop oor access to electronic data base of equipment line drawings, electrical wiring diagrams, parts listing reference guide and part cost lists.
Inputs
Budgets Manufacturers Recommended Maintenance Schedules & Speci cations Equipment and Facilities Monitoring Information MRO Parts Availability ES.4 Production Plans P3.4 Production Quality and Policies
Outputs
Equipment and Facilities Maintenance History Parts and Services Consumed ES.4, ES.5, ES.8
> EM.5
>
Equipment and Facilities Schedules and Plans M1.1, M2.1, M3.2 Equipment and Facilities Replacement and Disposition Plans P3.2, EM.6 Production Status EM.7 Preventative Maintenance and Calibration Schedule M1.1, M2.1, M3.2
3.3.53
EM.6
Manage Transportation (WIP)
The process of transporting In-Process Product (WIP). This includes management of the activities associated with in transit handling and movement of In-Process Product (WIP).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied Manage Transportation (WIP) Cycle Time None Identied Packaging volume, % of pallets that are reusable, % of trucks using retread tires, % of vehicle fuel derived from alternative fuels, Cost to Manage Transportation, % of paints used that are non-toxic Packaging as % of total material Description/Denition Utilize retread tires Utilize non-wood pallets or recycled pallets Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Utilize alternative fuel vehicles Reduction of WIP handling through automation (i.e. AGVs and ASRS) and process improvement (i.e. reduction of handling steps, shorter move paths) Software that allows for input of the distance that particular parts/WIP need to be moved. This software then need to provide a report based on the cubic feet of material times distance moved by part number.
Supply Chain Asset Management Best Practices Utilize retread tires Utilize non-wood or recycled pallets Implement pollution prevention program Utilize alternative fuel vehicles Reduce In-Process Product (WIP) Handling Short Move Paths
3.3.54
EM.6
Inputs
Equipment and Facilities Replacement and Disposition Plans EM.5 Production Orders Planned & Actual Reports WIP Handling Rules, Move Information and Methods EM.4 Capacity Requirements Projected Delivery Requirements EM.7 Supplier Agreement ES.10, S3.2 Product Location Information M1.2, M2.2, M3.3
Outputs
> EM.6
> WIP Location Rules
WIP Move Information and Methods M1.2, M2.2, M3.3, D2.9 WIP Inventory Location S1.4, S2.4, S3.6
3.3.55
EM.7
Manage Production Network
The process of identifying and maintaining a network of intra-company production units that deliver specic semi-nished materials or product sets to the nal production site.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Collaborative Planning/Scheduling JIT Environment Production Reporting/Status Metric None Identied Manage Production Network Cycle Time, Supply chain down time due to compliance issues None Identied Cost to Manage Production Network None Identied Description/Denition Interactive, on-line planning/scheduling systems. Capacity planning systems with accurate production capability data. Schedule visibility, on-line communications between source and demand Real time monitoring of production status and In-Process Product (WIP)
Inputs
Planning Data EP.3 Production Status EM.5 Supply Chain Plans P1.4
Outputs
> EM.7
> Internal Capacity Projected Delivery

Requirements EM.6, ED.6
Cost to Produce
3.3.56
EM.8
Manage Make Regulatory Environment
The process of identifying and complying with regulatory documentation and process standards set by external entities (eg government)
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automated Conformance Monitoring And Control Automatic Generation And Submission Of Conformance Documents Implement pollution prevention program Maintaining Repository of Current Regulatory Requirements Implement an EMS Metric % of employees trained on environmental requirements Manage MAKE Regulatory Compliance Cycle Time None Identied Cost to Manage MAKE Regulatory Compliance, Pollution Prevention Ratio None Identied Description/Denition Internal automatic notication of conformance, including holding of product until requirements are met Software specic to industry regulations and standards (e.g. may be software to produce MSDS documents, or FDA requirements, etc.) Implement rigorous and comprehensive pollution prevention program and include environmentally preferable purchasing Electronic subscription and publication of conformance documentation. Electronic Document Management System features. Implement an EMS
Inputs
Equipment and Facilities Characteristics External Regulatory Information Corporate Objectives and Strategies Product Design/Claims
> EM.8
> Conformance Rules

Conformance Plan
Outputs
3.3.57
EM.9
Manage Supply Chain Make Risk
The process of managing Make risks within an overall supply Chain risk Program. This includes identifying and assessing make risks as well as and planning and implementing responses to Make risks. Make risks include potential events that could impact your ability to make on-time at a reasonable cost with good quality. The risks can occur internally within your organization, e.g. a matching breakdown or facility re, or externally, e.g. a hurricane, that impacts your ability to Make. Response planning includes: mitigation, either reducing the impact of a Make risk event or reducing the likelihood it will occur; transfer; acceptance. An organization has a high level of control and exibility of action concerning internal Make risks, so they are prime candidates for control Response planning can be aggregated for make risks across the organization.
Performance Attributes Supply Chain Reliability Metric Supplier Mitigation Plans Implemented (percent), Value at Risk (Make), Age of Supplier Risk Data (months), VAR of Internal Process Performance, Age of Product / Customer Risk Data (months), VAR of Supplier Performance, VAR of product/customer performance External Event Response (average days) Industry Benchmark Comparison (%), Hedge Rating (Inventory DOS for risk management), Options Rating (0-100%), Internal Event Response (average days) Mitigation Cost ($), Mitigation cost by Event ($), Assessment / Risk Management Costs ($) Residual Risk ($), Individual Process Area Event Rating (EVAR) ($), Mitigated Risk ($), Event Risk (EVAR) ($), Supply / Customer / Product Base Rated (%), Gross Risk ($) Description/Denition This practice involves establishing business rules (e.g., customer priority, supplier priority, production routing, transportation routing, etc.) based on minimizing the risk to the supply chain. Under this practice, business rules are established or congured in response to the corporate risk management plan with a goal of reducing either the likelihood of a disruption occurring or the impact to the supply chain should a disruption occur.
Supply Chain Costs
Best Practices Supply Chain Business Rules Congured to mitigate risk
3.3.58
EM.9
Best Practices cont. Description/Denition cont. Business rule reconguration typically includes an assessment of the impact of each rule change on the overall supply chain before actual implementation. Supply Chain Risk Monitoring Once areas of risk have been identied, an organization needs to monitor their internal and external environment. This helps them to predict when risky events are becoming more likely. It also helps to identify new risks and is tightly linked to the best practice of Supply Chain Risk Identication. Supply chain risk management is the systematic identication, assessment and mitigation of potential disruptions in logistics networks with the objective to reduce their negative impact on the logistics networks performance. Supply Chain Risk assessment provides management with an understanding of where the greatest risks may exist in order to prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of the risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events. the team can then prioritize addressing the risks. This practice involves managing supply chain information networks to minimize the risk to the supply chain. This includes information sharing with partners as well as internal locations. This helps all parties to be quickly informed of a real or potential disruption and respond quickly and appropriately to minimize the disruption impact. A key aspect of supply chain risk management is identication. Identication involves creating a list of potential events that could harm any aspect of the supply chains performance. Risk identication allows an organization to take steps to create plans to manage risks before they occur. this is typically more cost eective then waiting to react to adverse events when they occur. This practice relies on a risk evaluation of the supply chain to guide the design of the supply chain network. Node locations, transportation routes, capacity size and location, number of suppliers, number of production locations, etc. are all determined in a fashion that mitigates potential disruptions to the ability to deliver product and service to the end customer. This practice relies on the information collected through risk identication and risk assessment processes to identify nodes that are at a high risk of disruption due to the location of the node. Location specic risks can include tactical strike risks, natural disaster risks, single point of failure risks, etc.
Supply Chain Risk Identication
Supply Chain Network Congured to Mitigate Risk
3.3.59
EM.9
Best Practices cont. Crisis Communications Planning Description/Denition cont. Open communication is necessary for eective risk management, where the term open refers to the possibility to directly reach the right person who can better handle the information about a crisis situations wherever in the organization. Managers require direct communication channels up, down and across their business units to help identify risks and take appropriate actions.
Inputs
Outputs
> EM.9

3.3.60
D
Deliver
The processes associated with performing customer-facing order management and order fulllment activities.
Process Categories D1: Deliver Stocked Product The process of delivering product that is sourced or made based on aggregated customer orders, projected orders/demand and inventory re-ordering parameters. The intention of Deliver Stocked Product is to have the product available when a customer order arrives (to prevent the customer from looking elsewhere). For services industries, these are services that are pre-dened and o-the-shelf (e.g. standard training). Products or services that are congurable cannot be delivered through the Deliver Stocked Product process, as congurable products require customer reference or customer order details. The processes of delivering product that is sourced, congured, manufactured, and/or assembled from standard raw materials, parts, ingredients or sub-assemblies, in response to a specic rm customer order. A reference to the customer order is exchanged with the sourcing or make process and attached to or marked on the product. Products in stock are identiable by customer order through labeling and inventory data management. Examples include assigning a serial number, lot number or batch number to a customer order prior to Make or Source, processes that generate a bill-of-materials for the associated Make process (e.g. congure-to-order and assemble-toorder) and the special order process in retail. The process of obtaining, responding to, and allocating resources for a customer order that has unique requirements or specications and delivering a product that is partially or fully designed, redesigned, manufactured, and/or assembled from a bill of materials or recipe that includes one or more custom parts or ingredients. Design will begin only after the receipt and validation of a rm customer order. Deliver Retail Products are the processes used to acquire, merchandise, and sell nished goods at a retail store. A retail store is a physical location that sells products (and services) direct to the consumer using a point of sale process (manual or automated) to collect payment. Merchandising at a store level is the stocking and restocking of products in designated storage locations to generate sales in a retail store. The collection of processes associated with managing and monitoring Deliver process data, performance and relationships.
D2: Deliver Make-to-Stock Product
D3: Deliver Engineer-toOrder Product
D4: Deliver Retail Product
ED: Enable Deliver
3.4.1
D1
Deliver Stocked Products
The process of delivering product that is sourced or made based on aggregated customer orders, projected orders/demand and inventory re-ordering parameters. The intention of Deliver Stocked Product is to have the product available when a customer order arrives (to prevent the customer from looking elsewhere). For services industries, these are services that are pre-dened and o-the-shelf (e.g. standard training). Products or services that are congurable cannot be delivered through the Deliver Stocked Product process, as congurable products require customer reference or customer order details.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric Perfect Order Fulllment Deliver Cycle Time, Order Fulllment Cycle Time Upside Deliver Adaptability, Downside Deliver Adaptability, Upside Deliver Flexibility Cost to Deliver, Finished Goods Inventory Days of Supply, Order Management Costs Return on Supply Chain Fixed Assets, Return on Working Capital, Cash-To-Cash Cycle Time Description/Denition Postponement (delayed dierentiation) is a supply chain concept where a product is kept as long as possible in a generic state. Dierentiation of the generic product into a specic end-product is shifted closer to the consumer by postponing identify changes, such as assembly or packaging, to the last possible supply chain location. None identied Demand Planning, Deployment, Scheduling None identied None identied
Supply Chain Costs
Best Practices Postponement
Electronic Catalogues/Malls Ecient Consumer Response (ECR); Quick Response Internet Ordering Rapid Replenishment, VMI, EDI
3.4.2
D1
Customer Inquiry
! D1.1 !
Customer Quote D1.2
(Customer) Customer Replenish Signal Order Rules ED.1 (Customer) Deliver Contract Terms Customer Quote D1.1 (Customer) Customer Order
! D1.2 !
Optional Payment Validated Order D1.3 Customer Order D3.4, ED.2 Actual Sales History P5.1 Shipping Preferences (Customer) ED.3 Validated Order D1.3 Purchase History ED.3 Customer Address Data ED.3 Location of Customers ED.7 Contract Status ED.3 Credit History D2.2, ED.3
Delivery Plan P4.4 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Sourcing Plans P2.4 Production Schedule M1.1, M2.1, M2.2, M3.2 Validated Order D1.2 Production Plans P3.4
! D1.3 !
Delivery Date D1.4, D2.4 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Order Backlog P1.1, P4.1 Inventory Availability/Delivery Date P4.2 Shipments P1.1
Delivery Date D1.3, D2.3
! D1.4 !
Daily Shipment Volume D1.5
! D1.5 !
Load Information P4.2, D1.6, D2.6, D3.6 Plan and Build Loads Information SR1.4, SR2.4, SR3.4
Load Information D1.5, D2.5, D3.5 Rated Carrier Data Routing Guide
! D1.6 !
Shipment Routes D1.7, D2.7
! D1.7 !
A
Scheduled Deliveries D1.9
3.4.3
D1
Authorization to Scrap SR1.2, SR2.2, SR3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 Scheduled Receipts S1.1, S2.1, S3.3 Finished Product Release M1.6, M2.6, M3.7 Authorization to Return to Service SR1.2, SR2.2, SR3.2
! D1.8 !
A
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Existing Inventory Data ES.4, ED.4
Inventory Available S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Shipment Routes D1.7, D2.6, D3.5
! D1.9
D1.10
Shipping Parameters and Documentation ED.6 Shipping Export Parameters and Documentation ED.8
! D1.11 !
Order Backlog P1.1, P4.1 Shipping History ED.8 Shipping Documents Load, Shipping, Verify, and Credit Information SR1.5, SR2.5, SR3.5 Shipments P1.1 Delivered End Items
D1.12 D1.13 !
Product S1.2, S2.2, S3.4, D1.14, D2.14, D3.14 Product S1.2, S2.2, S3.4, D1.14, D2.14, D3.14
! D1.14 !
Installed Product D1.15, D2.15
Installed Product D1.14, D2.14, D3.14
! D1.15 !
Payment
3.4.4
D1.1
Process Inquiry and Quote
Receive and respond to general customer inquiries and requests for quotes
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Quote Capability, without Reserving Inventory, Which Can Be Converted into an Order in a Single Step Single Point of Contact for All Order Inquiries (Including Order Entry) Metric None Identied Process Inquiry & Quote Cycle Time None Identied Cost to Process Inquiry & Quote None Identied Description/Denition None identied
None identied
Inputs
Customer Inquiry
> D1.1
> Customer Quote

D1.2
Outputs
3.4.5
D1.2
Receive, Enter and Validate Order
Receive orders from the customer and enter them into a companys order processing system. Orders can be received through phone, fax, or electronic media. Technically examine orders to ensure an orderable conguration and provide accurate price. Check the customers credit. Optionally accept payment.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Remote (Sales, Customers) Order Entry Capability Enable Real-Time Visibility into Backlog, Order Status, Shipments, Scheduled Material Receipts, Customer Credit History, and Current Inventory Positions Value Pricing Based on Cost to Serve; EDLP; Cost Plus Pricing Automatic Multi-level Credit Checking: Dollar Limits; Days Sales Outstanding; Margin Testing Continuous Replenishment Programs; Vendor Managed Inventory, Telemetry to Automatically Communicate Replenishment of Chemicals Electronic Commerce (Customer Visibility of Stock Availability, Use of Hand-Held Terminals for Direct Order Entry, Conrmation, Credit Approval), On-Line Stock Check and Reservation of Inventory Metric None Identied Receive, Enter & Validate Order Cycle Time, Order Fulllment Dwell Time None Identied Cost to Receive, Enter & Validate Order None Identied Description/Denition None identied None identied
Activity Based Costing; Integrated Order Management by Customer by Line Item Integrated Order/Financial Management
Integrated demand/deployment planning to customer location driven by POS; Customer movement data
EDI applications and integrated order management
3.4.6
D1.2
Outputs
Optional Payment Validated Order D1.3 Customer Order D3.4, ED.2 Actual Sales History P5.1 Shipping Preferences (Customer) ED.3 D1.3
Inputs
(Customer) Customer Replenish Signal Order Rules ED.1 (Customer) Deliver Contract Terms Customer Quote D1.1 (Customer) Customer Order
> D1.2
> Validated Order
Purchase History ED.3 Customer Address Data ED.3 Location of Customers ED.7 Contract Status ED.3 Credit History D2.2, ED.3
3.4.7
D1.3
Reserve Inventory and Determine Delivery Date
Inventory (both on hand and scheduled) is identied and reserved for specic orders and a delivery date is committed and scheduled.
Performance Attributes Supply Chain Reliability Metric Delivery Performance to Customer Commit Date, Fill Rate, % of Orders Delivered In Full Reserve Inventory & Determine Delivery Date Cycle Time, Order Fulllment Dwell Time None Identied Cost to Reserve Resources & Determine Delivery Date None Identied Description/Denition Include environmental costs in inventory carrying costs None identied
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Include environmental costs Inventory Allocation Exception Process is Clearly Dened and Jointly Owned by Manufacturing and Sales Priority-Based Inventory Reservations, for Key Customers, with FIFO Allocation for All Others Automatic Reservation of Inventory and Dynamic Sourcing of Product for Single Shipment to Customer Establish spill controls Available-to-Promise (ATP)
None identied
Integrated order management system that treats each order line as a separate order with integration to inventory source and status; Real-time inventory management Establish spill controls for nished goods inventory storage Available-to-Promise (ATP) provides an availability and feasibility check concerning a customer request or a customer order. None identied
EDI Links between Manufacturing and Distributor to Achieve Visibility of Complete Finished Goods Inventory and Expected Shipments
3.4.8
D1.3
Inputs
Delivery Plan P4.4 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Sourcing Plans P2.4 Production Schedule M1.1, M2.1, M2.2, M3.2 Validated Order D1.2 Production Plans P3.4
Outputs
> D1.3
Backlog > OrderP4.1 P1.1,
Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6
Inventory Availability/Delivery Date P4.2 Shipments P1.1
3.4.9
D1.4
Consolidate Orders
The process of analyzing orders to determine the groupings that result in least cost/best service fulllment and transportation.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consolidate Orders by Customer, Source, Trac Lane, Carrier, Etc. Consolidate to minimize energy consumption Combine Consolidation Needs with Other Products/Divisions/ Companies Metric None Identied Consolidate Orders Cycle Time None Identied Cost to Consolidate Orders None Identied Description/Denition Integrated load planning and building with warehouse management Consolidate to minimize fuel/energy consumption None identied
Inputs
> D1.4
> Daily Shipment Volume D1.5
Outputs
3.4.10
D1.5
Build Loads
Transportation modes are selected and ecient loads are built.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consolidation of Inbound and Outbound Requirements Vendor Managed Inventory Metric None Identied Build Loads Cycle Time None Identied Quantity per shipment, Cost to Build Loads None Identied Description/Denition Integrated inbound/outbound transportation planning VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Integrated inbound/outbound transportation planning (i.e. 1st truck destination loaded last, etc.). Select carriers with good environmental records Select carriers that have adopted an EMS or otherwise demonstrated environmental commitment Integration with CRP/VMI vendor systems
Build Load in Stop Sequence Select carriers with good records Select carriers with EMS CRP & VMI Loads Optimized for Utilization
Inputs
Outputs
> D1.5
>
Load Information P4.2, D1.6, D2.6, D3.6 Plan and Build Loads Information SR1.4, SR2.4, SR3.4
3.4.11
D1.6
Route Shipments
Loads are consolidated and routed by mode, lane and location.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Vendor Managed Inventory Metric None Identied Route Shipments Cycle Time None Identied Cost to Route Shipments, Energy Costs None Identied Description/Denition VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Satellite communications, GPS, RFID Transportation modeling and rate analysis Integrated Load Building; Routing & Scheduling with Advanced Ship Notice (ASN) Route to minimize fuel consumption
Shipment Tracking and Tracing Consolidation of Carriers CRP/VMI Route to minimize fuel consumption
Inputs
> D1.6
> Shipment Routes D1.7, D2.7
Outputs
3.4.12
D1.7
Select Carriers and Rate Shipments
Specic carriers are selected by lowest cost per route and shipments are rated and tendered.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Select carriers with EMS Select complaint carriers Select carriers using retread tires Select Carriers by Least Cost per Shipment and Rate Using Actual Rates Prior to Release to Billing Metric % of suppliers meeting environmental metrics/criteria Select Carriers & Rate Shipments Cycle Time None Identied Cost to Select Carriers & Rate Shipments None Identied Description/Denition Select carriers that have adopted an EMS or otherwise demonstrated environmental commitment Select carriers that have not violated environmental laws Select carriers using retread tires Rules based carrier selection and actual rate database
Inputs
> D1.7
> Scheduled Deliveries D1.9
Outputs
3.4.13
D1.8
Receive Product from Source or Make
The activities such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location that a company performs at its own warehouses. May include quality inspection.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automatic Identication Cross-Docking Metric None Identied Receive Product from Source or Make Cycle Time None Identied Cost to Receive Product from Source or Make None Identied Description/Denition Bar Coding & Radio Frequency Communications Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place. Integration with Procurement Systems & Electronic Commerce with Vendors Merge-in-Transit is a practice to combine items from multiple sources into a single customer shipment. This includes items on stock in the distribution center, from which the shipment is sent, items on stock in other distribution centers, items on stock elsewhere (e.g. at a plant or a supplier) as well as maketo-order items. The items to be merged are cross-docked from inbound receipt to outbound shipping. Merging is usually performed in a shippers distribution center (DC) or in a carriers terminal.
Download P.O. & Advanced Ship Notices for Automated Receiving and Put Away Merge-in-Transit
3.4.14
D1.8
Inputs
Authorization to Scrap SR1.2, SR2.2, SR3.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 Scheduled Receipts S1.1, S2.1, S3.3 Finished Product Release M1.6, M2.6, M3.7 Authorization to Return to Service SR1.2, SR2.2, SR3.2
Outputs
> D1.8
>
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Existing Inventory Data ES.4, ED.4
3.4.15
D1.9
Pick Product
The series of activities including retrieving orders to pick, determining inventory availability, building the pick wave, picking the product, recording the pick and delivering product to shipping in response to an order.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Dynamic Simulation of Picking Requirements Optimized for Labor, Cost, and Time Use of Speed Racks for Automated Material Handling Merge-in-Transit Metric Fill Rate Pick Product Cycle Time None Identied Cost to Pick Product None Identied Description/Denition Rules based picking logic and simulation
None identied Merge-in-Transit is a practice to combine items from multiple sources into a single customer shipment. This includes items on stock in the distribution center, from which the shipment is sent, items on stock in other distribution centers, items on stock elsewhere (e.g. at a plant or a supplier) as well as maketo-order items. The items to be merged are cross-docked from inbound receipt to outbound shipping. Merging is usually performed in a shippers distribution center (DC) or in a carriers terminal. A practice used in many DC operations to increase labor picking productivity and reduce the labor cost per pick. In some DCs, orders are scheduled to be picked when they are received. Wave picking consolidates orders into waves where multiple orders with similar characteristics are picked at one time. Orders can be consolidated by customer, geography, or any other criteria that makes sense for the DC operation.
Wave picking
Inputs
Inventory Available S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Shipment Routes D1.7, D2.6, D3.5
> D1.9
> None Identi ed
Outputs
3.4.16
D1.10
Pack Product
The activities such as sorting / combining the products, packing / kitting the products, paste labels, barcodes etc. and delivering the products to the shipping area for loading.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices None Identied Metric % correct material documentation Pack Product Cycle Times None Identied Cost to Pack Product None Identied Description/Denition None Identied
Inputs
None Identi ed
> D1.10
> None Identi ed
Outputs
3.4.17
D1.11
Load Vehicle & Generate Shipping Docs
The series of tasks including placing/loading product onto modes of transportation, and generating the documentation necessary to meet internal, customer, carrier and government needs. Shipping documentation includes the invoice. Optionally verify customer credit.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Shipment Tracking Full Visibility of Credit History by Shipping Personnel Advanced Shipping Notices & UCC128 Container Labeling Carrier Agreement Metric Documentation Accuracy, Delivery Performance to Customer Commit Date Load Product & Generate Shipping Documentation Cycle Time None Identied Cost to Load Product & Generate Shipping Documentation None Identied Description/Denition None identied None identied Bar coding; EDI; integrated transportation/warehouse management Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions. None identied Interface to suppliers shipping system to nancials Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place.
Electronic Generation and Download of Shipping Documents Integrated Credit Checking Cross-Docking
3.4.18
D1.11
Outputs Inputs
Shipping Parameters and Documentation ED.6 Shipping Export Parameters and Documentation ED.8 Order Backlog P1.1, P4.1
> D1.11
> Shipping Documents

Shipments P1.1 Delivered End Items
Shipping History ED.8
Load, Shipping, Verify, and Credit Information SR1.5, SR2.5, SR3.5
3.4.19
D1.12
Ship Product
The process of shipping the product to the customer site.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Shipment Tracking Cross-Docking Metric Delivery Performance to Customer Commit Date, % of Orders Delivered In Full Ship Product Cycle Time None Identied Cost to Ship Product None Identied Description/Denition None identied Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place. Retrieve packaging after installation for reuse
Retrieve packaging after installation
Inputs
None Identi ed
> D1.12
> None Identi ed
Outputs
3.4.20
D1.13
Receive and Verify Product by Customer
The process of receiving the shipment by the customer (either at customer site or at shipping area in case of self-collection) and verifying that the order was shipped complete and that the product meets delivery terms.
Performance Attributes Supply Chain Reliability Metric Delivery Performance to Customer Commit Date, Perfect Condition, % of Orders Delivered In Full Receive & Verify Product by Customer Cycle Time None Identied Cost to Receive & Verify Product by Customer None Identied Description/Denition Bar coding; EDI; integrated transportation/warehouse management
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Advanced Shipping Notices & UCC128 Container Labeling
Outputs Inputs
None Identi ed
> D1.13
> Product S3.4, D1.14, D2.14, S1.2, S2.2,

D3.14
3.4.21
D1.14
Install Product
When necessary, the process of preparing, testing and installing the product at the customer site. The product is fully functional upon completion.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Joint Service Agreements to Document Acceptable Service Levels in Terms of Installation Costs, Installation Cycle Time, Etc. Metric Perfect Condition, % Of Faultless Installations Install Product Cycle Time None Identied Cost to Install Product None Identied Description/Denition Collaborative planning tools with the Source suppliers. (This would be eective between customer and supplier, and between internal functions such as Field Service, Manufacturing, Marketing and Order Management)
Inputs
Product D1.13, D2.13, D3.13
> D1.14
> Installed Product D1.15, D2.15
Outputs
3.4.22
D1.15
Invoice
A signal is sent to the nancial organization that the order has been shipped and that the billing process should begin and payment be received or be closed out if payment has already been received. Payment is received from the customer within the payment terms of the invoice.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Utilize EDI and EFT for Payment to Speed Closing of Receivables and to Reduce Processing Costs Electronic Transfer of Shipment Information to Finance Provide Visibility to and Quickly Escalate Delinquent Accounts for Resolution Metric % of Faultless Invoices, Documentation Accuracy Invoice Cycle Time None Identied Cost to Invoice None Identied Description/Denition EDI transaction and network services
None identied Integrated accounts receivables
Inputs
> D1.15
> Payment
Outputs
3.4.23
D2
Deliver Make-to-Order Product
The processes of delivering product that is sourced, congured, manufactured, and/or assembled from standard raw materials, parts, ingredients or sub-assemblies, in response to a specic rm customer order. A reference to the customer order is exchanged with the sourcing or make process and attached to or marked on the product. Products in stock are identiable by customer order through labeling and inventory data management. Examples include assigning a serial number, lot number or batch number to a customer order prior to Make or Source, processes that generate a bill-of-materials for the associated Make process (e.g. congure-to-order and assemble-to-order) and the special order process in retail.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric Perfect Order Fulllment Order Fulllment Cycle Time, Deliver Cycle Time Downside Deliver Adaptability, Upside Deliver Flexibility, Upside Deliver Adaptability Cost to Deliver, Energy Costs, Finished Goods Inventory Days of Supply Cash-To-Cash Cycle Time, Return on Working Capital, Return on Supply Chain Fixed Assets Description/Denition Postponement (delayed dierentiation) is a supply chain concept where a product is kept as long as possible in a generic state. Dierentiation of the generic product into a specic end-product is shifted closer to the consumer by postponing identify changes, such as assembly or packaging, to the last possible supply chain location.
Supply Chain Costs
Best Practices Postponement
3.4.24
D2
Customer Inquiry
D2.1 !
Order Quote (Customer) D2.2
Con guration Rules ED.1 Order Quote (CUSTOMER) D2.1 Contract Terms Order Rules ED.1 Credit History D1.2, D2.2, D3.1
! D2.2 !
Location of Customers ED.7 Purchase History ED.3 Contract Status ED.3 Credit History D1.2, D2.2, D3.1 Optional Payment Booked Order D2.3, ED.3 Customer Address Data ED.3 Customer Order Size, Weight, and Freight Class ED.6 Shipping Preferences (Customer) ED.3 Actual Sales History P5.1
Delivery Plans P4.4 Production Plans P3.4 Sourcing Plans P2.4 Booked Order D2.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2
! D2.3 !
Delivery Date D1.4, D2.4 Order Signal P2.1, P3.1 Order Backlog P1.1, P4.1 Inventory Status Customer Order D3.4, ED.2 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Available to Promise Date Inventory Availability/Delivery Date P4.2
! D2.4 !
Consolidated Orders D2.5
! D2.5 !
Load Information P4.2, D1.6, D2.6, D3.6
Rated Carrier Data Load Information D1.5, D2.5, D3.5 Routing Guide
! D2.6 !
Shipment Routes D1.7, D2.7 Scheduled Deliveries D1.9
! D2.7
3.4.25
D2 D2.8
Production Schedule M1.1, M2.1, M2.2, M3.2 WIP Location Rules EM.6 Finished Product Release M1.6, M2.6, M3.7 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
! D2.9
D2.10
!D2.11 !
Advance Ship Notice D2.13 Shipping History ED.8 Shipping Documents Delivered End Items
D2.12
Advance Ship Notice D2.11
!D2.13 ! !D2.14 ! !D2.15 !
Product S1.2, S2.2, S3.4, D1.14, D2.14, D3.14
Product D1.13, D2.13, D3.13
Payment
3.4.26
D2.1
Process Inquiry and Quote
Receive and respond to general customer inquiries and requests for quotes.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Quote Capability, without Reserving Inventory, Which Can Be Converted into an Order in a Single Step Quote Capability, without Reserving Inventory, Which Can be Converted into an Order, But Does Not Generate Build Signal or Reserve Inventory Capacity Single Point of Contact for All Order Inquiries (Including Order Entry) Metric None Identied Process Inquiry & Quote Cycle Time None Identied Cost to Process Inquiry & Quote None Identied Description/Denition None identied
None identied
None identied
Inputs
Customer Inquiry
> D2.1
> Order Quote (Customer) D2.2
Outputs
3.4.27
D2.2
Receive, Congure, Enter and Validate Order
Receive orders from the customer and enter them into a companys order processing system. Orders can be received through phone, fax, or through electronic media. Congure your product to the customers specic needs, based on standard available parts or options. Technically examine order to ensure an orderable conguration and provide accurate price. Check the customers credit. Optionally accept payment.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automated Conguration Management Electronic Commerce (Customer Visibility of Stock Availability, Use of HandHeld Terminals for Direct Order Entry, Conrmation, Credit Approval), On-Line Stock Check and Reservation of Inventory Value Pricing Based on Cost to Serve; EDLP; Cost Plus Pricing Enable Real-Time Visibility into Backlog, Order Status, Shipments, Scheduled Material Receipts, Customer Credit History, and Current Inventory Positions Order Entry is Organized by Customer Segment Customers Receive Dierentiated Service Based on Volume of Business Customer Team is Empowered to Fully Service Customer Requests, Including Formal Orders and Ad Hoc Requests Customers Have One Point of Conta Remote (Sales, Customers) Order Entry Capability Automatic Multi-level Credit Checking: Dollar Limits; Days Sales Outstanding; Margin Testing Metric None Identied Receive, Congure, Enter & Validate Order Cycle Time, Order Fulllment Dwell Time None Identied Cost to Receive, Enter & Validate Order None Identied Description/Denition Conguration EDI applications and integrated order management
Activity Based Costing; Integrated Order Management by Customer by Line Item None identied
None identied
None identied Integrated Order/Financial Management
3.4.28
D2.2
Outputs
Location of Customers ED.7 Purchase History ED.3
Inputs
Con guration Rules ED.1 Order Quote (CUSTOMER) D2.1 Contract Terms Order Rules ED.1 Credit History D1.2, D2.2, D3.1
Contract Status ED.3 Credit History D1.2, D2.2, D3.1
> D2.2
> Booked Order

D2.3, ED.3
Optional Payment
Customer Address Data ED.3 Customer Order Size, Weight, and Freight Class ED.6 Shipping Preferences (Customer) ED.3 Actual Sales History P5.1
3.4.29
D2.3
Reserve Inventory and Determine Delivery Date
Inventory and/or planned capacity is identied and reserved for specic orders, and a delivery date is committed and scheduled.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Dynamic Deployment Based on Constraint Based Planning and Optimal Scheduling Available-to-Promise (ATP) Include environmental costs Automatic Reservation of Inventory and Dynamic Sourcing of Product for Single Shipment to Customer Establish spill controls Metric % of Orders Delivered In Full, Delivery Performance to Customer Commit Date Order Fulllment Dwell Time, Reserve Resources and Determine Delivery Date Cycle Time None Identied Cost to Reserve Resources & Determine Delivery Date None Identied Description/Denition Advanced planning and scheduling logic with constraint, cost, and resource optimization Available-to-Promise (ATP) provides an availability and feasibility check concerning a customer request or a customer order. Include environmental costs in inventory carrying costs Integrated order management system that treats each order line as a separate order with integration to inventory source and status; Real-time inventory management Establish spill controls for nished goods inventory storage
3.4.30
D2.3
Outputs Inputs
Delivery Plans P4.4 Production Plans P3.4 Sourcing Plans P2.4 Booked Order D2.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 Delivery Date D1.4, D2.4 Order Signal P2.1, P3.1 Order Backlog P1.1, P4.1
> D2.3
Status > Inventory Order Customer D3.4, ED.2 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Available to Promise Date Inventory Availability/Delivery Date P4.2
3.4.31
D2.4
Consolidate Orders
The process of analyzing orders to determine the groupings that result in least cost/best service fulllment and transportation.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consolidate Orders by Customer, Source, Trac Lane, Carrier, Etc. Consolidate to minimize energy consumption Metric None Identied Consolidate Orders Cycle Time None Identied Cost to Consolidate Orders None Identied Description/Denition Integrated load planning and building with warehouse management Consolidate to minimize fuel/energy consumption
Inputs
> D2.4
> Consolidated Orders D2.5
Outputs
3.4.32
D2.5
Build Loads
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Select carriers with EMS CRP & VMI Loads Optimized for Utilization Consolidation of Inbound and Outbound Requirements Build Load in Stop Sequence Metric None Identied Build Loads Cycle Time None Identied Cost to Build Loads, Quantity per shipment None Identied Description/Denition Select carriers that have adopted an EMS or otherwise demonstrated environmental commitment Integration with CRP/VMI vendor systems Integrated inbound/outbound transportation planning Integrated inbound/outbound transportation planning (i.e. 1st truck destination loaded last, etc.).
Inputs
> D2.5
Information > LoadD1.6, D2.6, D3.6 P4.2,
Outputs
3.4.33
D2.6
Route Shipments
Loads are consolidated and routed by mode, lane, and location.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Vendor Managed Inventory Metric None Identied Route Shipments Cycle Time None Identied Cost to Route Shipments, Energy Costs None Identied Description/Denition VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Transportation modeling and rate analysis Satellite communications, GPS, RFID Route to minimize fuel consumption Integrated Load Building; Routing & Scheduling with Advanced Ship Notice (ASN)
Consolidation of Carriers Shipment Tracking and Tracing Route to minimize fuel consumption CRP/VMI
Inputs
Rated Carrier Data Load Information D1.5, D2.5, D3.5 Routing Guide
Outputs
> D2.6
> Scheduled Deliveries

D1.9
3.4.34
D2.7
Select Carriers and Rate Shipments
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Select Carriers by Least Cost per Shipment and Rate Using Actual Rates Prior to Release to Billing Select carriers with EMS Metric % of suppliers meeting environmental metrics/criteria Select Carriers & Rate Shipments Cycle Time None Identied Cost to Select Carriers & Rate Shipments None Identied Description/Denition Rules based carrier selection and actual rate database
Select carriers that have adopted an EMS or otherwise demonstrated environmental commitment
Inputs
> D2.7
> None Identi ed
Outputs
3.4.35
D2.8
The activities such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location for goods received from either Make or Source. May include quality inspection.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Download P.O. & Advanced Ship Notices for Automated Receiving and Put Away Dynamic Location Assignment Including Lot Control, Zoned Picking, Quality Assurance Automatic Identication Cross-Docking Metric None Identied Receive Product from Source or Make Cycle Time None Identied Cost to Receive Product from Source or Make None Identied Description/Denition Integration with Procurement Systems & Electronic Commerce with Vendors Real time inventory control, stock locator, and rules based picking logic Bar Coding & Radio Frequency Communications Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place.
Inputs
None Identi ed
> D2.8
> None Identi ed
Outputs
3.4.36
D2.9
Pick Product
The series of activities including retrieving orders to pick, verifying inventory availability, building the pick wave, picking the product, recording the pick and delivering product to packing area in response to an order.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Use of Speed Racks for Automated Material Handling Dynamic Simulation of Picking Requirements Optimized for Labor, Cost, and Time Dynamic Location Assignment Including Lot Control, Zoned Picking, Quality Assurance Metric % correct material documentation Pick Product Cycle Time None Identied Cost to Pick Product None Identied Description/Denition None identied Rules based picking logic and simulation
Real time inventory control, stock locator, and rules based picking logic
Inputs
Production Schedule M1.1, M2.1, M2.2, M3.2 WIP Location Rules EM.6 Finished Product Release M1.6, M2.6, M3.7 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
> D2.9
> None Identi ed
Outputs
3.4.37
D2.10
Pack Product
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Pack Product Cycle Times None Identied Cost to Pack Product None Identied
Inputs
None Identi ed
> D2.10
> None Identi ed
Outputs
3.4.38
D2.11
Load Product & Generate Shipping Docs
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Advanced Shipping Notices & UCC128 Container Labeling Integrated Credit Checking Electronic Generation and Download of Shipping Documents Carrier Agreement Metric Delivery Performance to Customer Commit Date, Documentation Accuracy Load Product & Generate Shipping Documentation Cycle Time None Identied Cost to Load Product & Generate Shipping Documentation None Identied Description/Denition Bar coding; EDI; integrated transportation/warehouse management Interface to suppliers shipping system to nancials None identied Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions. None identied Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place.
Full Visibility of Credit History by Shipping Personnel Cross-Docking
3.4.39
D2.11
Inputs
Outputs
> D2.11
> Shipping History ED.8
Shipping Documents Delivered End Items
3.4.40
D2.12
Ship Product
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Shipment Tracking Retrieve packaging after installation Cross-Docking Metric Delivery Performance to Customer Commit Date, % of Orders Delivered In Full Ship Product Cycle Time None Identied Cost to Ship Product None Identied Description/Denition None identied Retrieve packaging after installation for reuse Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place.
Inputs
None Identi ed
> D2.12
> None Identi ed
Outputs
3.4.41
D2.13
The process of receiving the shipment at the customer (either at customer site or at shipping area in case of self-collection) and verifying that the order was shipped complete and that the product meets delivery terms.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Shipment Tracking Advanced Shipping Notices & UCC128 Container Labeling Metric Perfect Condition, Delivery Performance to Customer Commit Date Receive & Verify Product by Customer Cycle Time None Identied Cost to Receive & Verify Product by Customer None Identied Description/Denition None identied Bar coding; EDI; integrated transportation/warehouse management
Inputs
Outputs
> D2.13
> Product S3.4, D1.14, D2.14, S1.2, S2.2,

D3.14
3.4.42
D2.14
Install Product
When necessary, the process of preparing, testing and installing the product at the customer site. The product is fully functional upon completion.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Joint Service Agreements to Document Acceptable Service Levels in Terms of Installation Costs, Installation Cycle Time, Etc. Metric Perfect Condition, % Of Faultless Installations Install Product Cycle Time None Identied Cost to Install Product None Identied Description/Denition Collaborative planning tools with the Source suppliers. (This would be eective between customer and supplier, and between internal functions such as Field Service, Manufacturing, Marketing and Order Management)
Inputs
Product D1.13, D2.13, D3.13
> D2.14
Outputs
3.4.43
D2.15
Invoice
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Provide Visibility to and Quickly Escalate Delinquent Accounts for Resolution Electronic Transfer of Shipment Information to Finance Metric Documentation Accuracy, % of Faultless Invoices Deliver Cycle Time None Identied Customer Invoicing/ Accounting Costs Days Sales Outstanding Description/Denition Integrated accounts receivables
None identied
Inputs
> D2.15
> Payment
Outputs
3.4.44
D3
Deliver Engineer-to-Order Products
The process of obtaining, responding to, and allocating resources for a customer order that has unique requirements or specications and delivering a product that is partially or fully designed, redesigned, manufactured, and/or assembled from a bill of materials or recipe that includes one or more custom parts or ingredients. Design will begin only after the receipt and validation of a rm customer order.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric Perfect Order Fulllment Deliver Cycle Time, Order Fulllment Cycle Time Upside Deliver Flexibility, Downside Deliver Adaptability, Upside Deliver Adaptability Cost to Deliver, Energy Costs, Order Management Costs, Finished Goods Inventory Days of Supply Return on Working Capital, Cash-To-Cash Cycle Time, Return on Supply Chain Fixed Assets
Supply Chain Costs
3.4.45
D3
RFQ/RFP
! D3.1 !
Contract Status ED.3 Customer address Data ED.3 Completed Proposal D3.2 Purchase History ED.3 Credit History D2.2, ED.3 Shipping Preferences (Customer) ED.3
Completed Proposal D3.1 Order Rules ED.1
! D3.2 !
Optional Payment Customer Order D3.4, ED.2 Location of Customers ED.7 Approved Contract D3.3 Customer Order Size, Weight, and Freight Class ED.6
Delivery Plans P4.4 Sourcing Plans P2.4 Production Plans P3.4 Production Schedule M1.1, M2.1, M2.2, M3.2 Approved Contract D3.2
! D3.3 !
Customer Order D3.4, ED.2 Actual Sales History P5.1 Order Information M3.1 Resource Availability P4.2, D4.1 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Order Backlog P1.1, P4.1 Order Signal P2.1, P3.1
Customer Order D1.2, D2.3, D3.2, D3.3
! D3.4 !
Scheduled Installation D3.5
! D3.5 !
Load Information P4.2, D1.6, D2.6, D3.6 Scheduled Deliveries D1.9
! D3.6
D3.7
3.4.46
D3 D3.8
Production Schedule M1.1, M1.2, M2.2, M3.2 Finished Product Release M1.6, M2.6, M3.7 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
! D3.9
D3.10
Shipping Export Parameters and Documentation ED.8 Shipping Parameters and Documentation ED.6
!D3.11 !
Shipping History ED.8 Shipping Documents
D3.12 D3.13!
Product D1.13, D2.13, D3.13 Product S1.2, S2.2, S3.4, D1.14, D2.14, D3.14
!D3.14 !
D3.15!
Payment
3.4.47
D3.1
Obtain & Respond to RFP/RFQ
The process of receiving a request for proposal or request for quote, evaluating the request (estimating the schedule, developing costs estimates, establishing price), and responding to the potential customer.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Partnership with Outside Design Firms to Provide Skills and Capacity, as Needed Use of CAD/CAE Applications to Simulate Design, Cost and Manufacturing Process Metric None Identied Obtain & Respond to Request for Quote (RFQ) / Request for Proposal (RFP) Cycle Ti None Identied Cost to Obtain & Respond to Request for Quote (RFQ) / Request for Proposal (RFP) None Identied Description/Denition None identied
None identied
Outputs
Contract Status ED.3 Customer address Data ED.3
Inputs
RFQ/RFP
> D3.1
> D3.2
Completed Proposal Purchase History ED.3 Credit History D2.2, ED.3 Shipping Preferences (Customer) ED.3
3.4.48
D3.2
Negotiate and Receive Contract
The process of negotiating order details with customer (e.g.: price, schedule, product performance) and nalizing the contract. Optionally accept payment.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Negotiate & Receive Contract Cycle Time None Identied Cost to Negotiate & Receive Contract None Identied
Inputs
Completed Proposal D3.1 Order Rules ED.1
Outputs
> D3.2
> Customer Order

D3.4, ED.2
Optional Payment
Location of Customers ED.7 Approved Contract D3.3 Customer Order Size, Weight, and Freight Class ED.6
3.4.49
D3.3
Enter Order, Commit Resources & Launch Program
The process of entering/nalizing the customers order, approving the planned resources (e.g., engineering, manufacturing, etc.) and ocially launching the program.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Metric Delivery Performance to Customer Commit Date, % of Orders Delivered In Full Enter Order, Commit Resources & Launch Program Cycle Time, Order Fulllment Dwell Time None Identied Cost to Enter Order, Commit Resources & Launch Program None Identied
Supply Chain Agility Supply Chain Costs Supply Chain Asset Management
Outputs Inputs
Delivery Plans P4.4 Sourcing Plans P2.4 Production Plans P3.4 Production Schedule M1.1, M2.1, M2.2, M3.2 Approved Contract D3.2 Customer Order D3.4, ED.2 Actual Sales History P5.1
> D3.3
> M3.1
Order Information Resource Availability P4.2, D4.1 Replenishment Signal S1.1, S1.4, S2.1, S2.4, S3.3, S3.6 Order Backlog P1.1, P4.1 Order Signal P2.1, P3.1
3.4.50
D3.4
Schedule Installation
The process of evaluating the design and build schedules relative to customer requested installation date to determine installation schedule.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Schedule to maximize transportation capacity Metric None Identied Schedule Installation Cycle Time None Identied Cost to Schedule Installation None Identied Description/Denition Schedule to maximize transportation capacity
Inputs
Customer Order D1.2, D2.3, D3.2, D3.3
> D3.4
> Scheduled Installation D3.5
Outputs
3.4.51
D3.5
Build Loads
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consolidation of Inbound and Outbound Requirements CRP & VMI Loads Optimized for Utilization Vendor Managed Inventory Metric None Identied Build Loads Cycle Time None Identied Cost to Build Loads None Identied Description/Denition Integrated inbound/outbound transportation planning Integration with CRP/VMI vendor systems VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. Integrated inbound/outbound transportation planning (i.e. 1st truck destination loaded last, etc.). Consolidate to minimize fuel/energy consumption
Build Load in Stop Sequence Consolidate to minimize energy consumption
Inputs
Outputs
> D3.5
Information > LoadD1.6, D2.6, D3.6 P4.2, Scheduled Deliveries D1.9
3.4.52
D3.6
Route Shipments
Loads are consolidated and routed by mode, lane, and location.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consolidation of Carriers CRP/VMI Shipment Tracking and Tracing Select carriers with EMS Select Carriers by Least Cost per Shipment and Rate Using Actual Rates Prior to Release to Billing Carrier/Route Optimization Based on Continuous Movement and Consolidation/Pooling Metric None Identied Route Shipments Cycle Time None Identied Cost to Route Shipments None Identied Description/Denition Transportation modeling and rate analysis Integrated Load Building; Routing & Scheduling with Advanced Ship Notice (ASN) Satellite communications, GPS, RFID Select carriers that have adopted an EMS or otherwise demonstrated environmental commitment Rules based carrier selection and actual rate database
Route scheduling, carrier selection, and rating
Inputs
> D3.6
3.4.53
D3.7
Select Carriers & Rate Shipments
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Select Carriers by Least Cost per Shipment and Rate Using Actual Rates Prior to Release to Billing Metric None Identied Select Carriers & Rate Shipments Cycle Time None Identied Cost to Select Carriers & Rate Shipments None Identied Description/Denition Rules based carrier selection and actual rate database
Inputs
None Identi ed
> D3.7
> None Identi ed
Outputs
3.4.54
D3.8
The activities such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location for goods received from either Make or Source. May include quality inspection.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automatic Identication Dynamic Location Assignment Including Lot Control, Zoned Picking, Quality Assurance Download P.O. & Advanced Ship Notices for Automated Receiving and Put Away Cross-Docking Metric % correct material documentation Receive Product from Source or Make Cycle Time None Identied Cost to Receive Product from Source or Make None Identied Description/Denition Bar Coding & Radio Frequency Communications Real time inventory control, stock locator, and rules based picking logic Integration with Procurement Systems & Electronic Commerce with Vendors Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place.
Inputs
Product S1, S2, S3, M1, M2, M3
> D3.8
> None Identied
Outputs
3.4.55
D3.9
Pick Product
The series of activities including retrieving orders to pick, verifying inventory availability, building the pick wave, picking the product, recording the pick and delivering product to packing area in response to an order.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Dynamic Location Assignment Including Lot Control, Zoned Picking, Quality Assurance Dynamic Simulation of Picking Requirements Optimized for Labor, Cost, and Time Metric None Identied Pick Product Cycle Time None Identied Cost to Pick Product None Identied Description/Denition Real time inventory control, stock locator, and rules based picking logic Rules based picking logic and simulation
Inputs
Production Schedule M1.1, M1.2, M2.2, M3.2 Finished Product Release M1.6, M2.6, M3.7 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
> D3.9
> None Identi ed
Outputs
3.4.56
D3.10
Pack Product
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Retrieve packaging after installation Metric None Identied Pack Product Cycle Times None Identied Cost to Pack Product None Identied Description/Denition Retrieve packaging after installation for reuse
Inputs
None Identi ed
> D3.10
> None Identi ed
Outputs
3.4.57
D3.11
Load Product & Generate Shipping Docs
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Integrated Credit Checking Cross-Docking Metric Documentation Accuracy Load Product & Generate Shipping Documentation Cycle Time None Identied Cost to Load Product & Generate Shipping Documentation None Identied Description/Denition Interface to suppliers shipping system to nancials Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place. None identied None identied Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions. Bar coding; EDI; integrated transportation/warehouse management
Electronic Generation and Download of Shipping Documents Full Visibility of Credit History by Shipping Personnel Carrier Agreement
Advanced Shipping Notices & UCC128 Container Labeling
Inputs
Shipping Export Parameters and Documentation ED.8 Shipping Parameters and Documentation ED.6
Outputs
> D3.11
> Shipping History ED.8

Shipping Documents
3.4.58
D3.12
Ship Product
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Cross-Docking Metric % of Orders Delivered In Full, Delivery Performance to Customer Commit Date Ship Product Cycle Time None Identied Cost to Ship Product None Identied Description/Denition Used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place. None identied
Shipment Tracking
Inputs
None Identi ed
> D3.12
> None Identi ed
Outputs
3.4.59
D3.13
The process of receiving the shipment (either at customer site or at shipping area in case of self-collection) and verifying that the order was shipped complete and that the product meets delivery terms.
Performance Attributes Supply Chain Reliability Metric Delivery Performance to Customer Commit Date, % of Orders Delivered In Full, Perfect Condition Receive & Verify Product by Customer Cycle Time None Identied Cost to Receive & Verify Product by Customer None Identied Description/Denition None identied Bar coding; EDI; integrated transportation/warehouse management
Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Shipment Tracking Advanced Shipping Notices & UCC128 Container Labeling
Inputs
None Identi ed
> D3.13
> Product S3.4, D1.14, D2.14, S1.2, S2.2,

D3.14
Outputs
3.4.60
D3.14
Install Product
The process of preparing, testing and installing the product at the customer site. The product is fully functional upon completion.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices None Identied Metric Perfect Condition Install Product Cycle Time None Identied Cost to Install Product None Identied Description/Denition None identied
Inputs
Product D1.13, D2.13, D3.13
> D3.14
Outputs
3.4.61
D3.15
Invoice
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Utilize EDI and EFT for Payment to Speed Closing of Receivables and to Reduce Processing Costs Electronic Transfer of Shipment Information to Finance Provide Visibility to and Quickly Escalate Delinquent Accounts for Resolution Metric % of Faultless Invoices, Documentation Accuracy Invoice Cycle Time None Identied Cost to Invoice None Identied Description/Denition EDI transaction and network services
None identied Integrated accounts receivables
Inputs
None Identi ed
> D3.15
> Payment
Outputs
3.4.62
D4
Deliver Retail Product
Deliver Retail Products are the processes used to acquire, merchandise, and sell nished goods at a retail store. A retail store is a physical location that sells products (and services) direct to the consumer using a point of sale process (manual or automated) to collect payment. Merchandising at a store level is the stocking and restocking of products in designated storage locations to generate sales in a retail store.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Metric None Identied Deliver Cycle Time, Order Fulllment Cycle Time Downside Deliver Adaptability, Upside Deliver Adaptability, Upside Deliver Flexibility Cost to Deliver Cash-To-Cash Cycle Time, Return on Supply Chain Fixed Assets, Return on Working Capital Description/Denition None identied
Best Practices None Identied
3.4.63
D4
Resource Availability D3.3 Vendor/DC inventory availability Store Allocation Instructions Daily Replenishment Requirements S1.4 Shipping Schedules (internal or 3PL) Stocking Requirements P4.4 On-demand Replenishment Requirements
! D4.1 !
Stocking Schedule D4.4
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 Item Stocking Requirements P4.1 Finished Product Release M1.6, M2.6, M3.7 Scheduled Receipts S1.1, S2.1, S3.3
! D4.2 !
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Item Pick Sheet for Stocking Schedule
Replenishment Quantities On-Order/Backorder Inventory in Stock Item Pick Sheet for Stocking Schedule D4.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
! D4.3 !
Load Retail Cart or Pallet D4.4 Assorted by Shelf Order
Vendor Merchandising / Co-op advertising agreements Stocking Schedule D4.1 Plan-o-gram Data Loaded Retail Cart or Pallet S1.4, D4.3
! D4.4 !
Full Shelf Locations D4.5 Store Shelf Inventory Counts P4.1
Lost or Dropped Shopping Carts Product Data (linked/related SKUs) Merchandising Plan Full Shelf Location D4.4 Customer Data (preference) Promotional Plan
! D4.5 !
Full Cart Ready for Checkout D4.6
Full Cart Ready for Checkout D4.5 Customer Pro le/Data Promotion Event Calendar
! D4.6 !
Point of Sale Data (Daily) P4.1 Full Cart (Empty Cart) Satis ed Customer Loyalty Customer Pro le Changes Customer Loyalty / Recurring Visits
D4.7 !
Consistently High Adoption Rates Successful Installation / Live System High Customer Services Satisfaction Levels Low Rates of Failure
3.4.64
D4
Generate Stocking Schedule
The process of scheduling resources to support item-stocking requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automated Pick List Labor Scheduling that Matches Product Flow Push Product on Trailer Arrival Metric None Identied Generate Stocking Schedule Cycle Time None Identied Cost to Generate Stocking Schedule None Identied Description/Denition System generated pick-lists based on picking / batching rules. Workforce management solution with exible rules. System prioritization of items coming o trucks vs. picked from back room.
Inputs
Resource Availability D3.3 Vendor/DC inventory availability Store Allocation Instructions Daily Replenishment Requirements S1.4 Shipping Schedules (internal or 3PL) Stocking Requirements P4.4 On-demand Replenishment Requirements
> D4.1
> Stocking Schedule D4.4
Outputs
3.4.65
D4.2
Receive Product at the Store
The activities such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location that a company performs at its own stores. May include quality inspection.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Push Product on Trailer Arrival Automated Pick List Labor Scheduling that Matches Product Flow Metric None Identied Receive Product Cycle Time None Identied Cost to Receive Product at Store None Identied Description/Denition System prioritization of items coming o trucks vs. picked from back room. System generated pick-lists based on picking / batching rules. Workforce management solution with exible rules.
Inputs
Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2 Production Schedule M1.1, M2.1, M2.2, M3.2 Item Stocking Requirements P4.1 Finished Product Release M1.6, M2.6, M3.7 Scheduled Receipts S1.1, S2.1, S3.3
Outputs
> D4.2
> S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2

Item Pick Sheet for Stocking Schedule
Inventory Availability
3.4.66
D4.3
Pick Product from Backroom
The process of retrieving restocking orders to pick, determining inventory availability, building a pick wave, picking item and quantity from a designated backroom warehouse location, recording the resulting inventory transaction, and delivering the product to point of stock.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Staging Based on In-store Zones Automated Directed Picking Automated Replenishment of Back Stock Based on Minimum Stocking Levels Dened Stocking Levels and Criteria Metric None Identied Pick Product from Backroom Cycle Time None Identied Cost to Pick Product from Backroom None Identied Description/Denition Items are staged for re-stocking based on zones within the store. This minimizes restocking eort. A pick list displayed on a handheld device that directs picks and relieves inventory from backroom locations None identied
None identied
Inputs
Replenishment Quantities On-Order/Backorder Inventory in Stock Item Pick Sheet for Stocking Schedule D4.2 Inventory Availability S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, D1.8, D4.2
Outputs
> D4.3
>
Load Retail Cart or Pallet D4.4 Assorted by Shelf Order
3.4.67
D4.4
Stock Shelf
For restocks, the tasks associated with identifying the item location, stocking the shelf according to merchandise plans, and recording the appropriate inventory transaction. For promotional items and stock repositioning the tasks associated with shelf and point of sale preparation, stock placement, and end of sale activities.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Proof of Performance (Promotion Management) Scan Displays for Promotion Conformance O Peak Stocking Stocking is Completed in Zones Item/Shelf Scanning Upon Put-AWay Metric None Identied Stock Shelf Cycle Time, In-stock % None Identied Cost to Stock Shelf None Identied Description/Denition Scan store shelves / bar codes to conrm put-a-way. Scan using handheld and match with ad. None identied The majority of stocking is completed with minimal impact to or visibility from the customer. Each area of the store has its own stocking plan and items are routed specically to that area. Scan store shelves / bar codes to conrm put-a-way.
Inputs
Vendor Merchandising / Co-op advertising agreements Stocking Schedule D4.1 Plan-o-gram Data Loaded Retail Cart or Pallet S1.4, D4.3
> D4.4
> Full Shelf Locations D4.5
Outputs
Store Shelf Inventory Counts P4.1
3.4.68
D4.5
Fill Shopping Cart
Typical set of tasks associated with product selection, storage and movement through to checkout.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Multiple Locations Throughout Store Up and Cross Selling and/or Substitution Items Are Relieved from Inventory When Item is Removed from Shelf Substitution Measured and Compared with Same Activity Previous Period Loyalty Card Data Metric % Item Location Accuracy Fill Shopping Cart Cycle Time None Identied Cost to Fill Shopping Cart None Identied Description/Denition Planned and tracked via a plan-o-gram system;Location specic product labeling. Trained sta or automated systems (Internet) that recommend up-sell, cross-sell, and/or substitution. RFID, smart cart or customer self-service reduces system inventory upon item pick. Trained sta or automated systems (Internet) that recommend up-sell, cross-sell, and/or substitution.See Up and cross selling DSS or portal tool that shows previous period performance and comparison for store management (whether it is a year ago, period ago, etc.). Use for comparison to previous sales activity/track new consumers, etc.
Inputs
Lost or Dropped Shopping Carts Product Data (linked/related SKUs) Merchandising Plan Full Shelf Location D4.4 Customer Data (preference) Promotional Plan
> D4.5
> Full Cart Ready for Checkout D4.6
Outputs
3.4.69
D4.6
Checkout
The processes and tasks associated with product checkout including scanning, method of payment, credit application and approval, service agreement, order conrmation, and/or invoice or receipt.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Notication of Existing/Future Event or Promotions Customer Prole Drive Recognition Upon Checkout Automatic Customer Payment Metric None Identied Checkout Cycle Time None Identied Cost to Checkout None Identied Description/Denition None identied None identied RFID, smart cart or customer self-service charges goods to card upon store departure.
Outputs Inputs
Full Cart Ready for Checkout D4.5 Customer Pro le/Data Promotion Event Calendar Point of Sale Data (Daily) P4.1
> D4.6
> Satis ed Customer
Full Cart (Empty Cart) Loyalty Customer Pro le Changes Customer Loyalty / Recurring Visits
3.4.70
D4.7
Deliver and/or Install
The process of preparing and installing the product at the customer site. The product is fully functional upon completion.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Provide Product or Service Training to Employees or FAQs Online Goals / Performance Plans Measurement, Monitoring and Adjustment of Service or Product Installation Stage Product or Service Adoption Metric None Identied Deliver and/or Install Cycle Time None Identied Cost to Deliver and/or Install None Identied Description/Denition None identied None identied None identied
None identied
Outputs
Consistently High Adoption Rates
Inputs
None Identi ed
> D4.7
> Successful Installation / Live System

High Customer Services Satisfaction Levels Low Rates of Failure
3.4.71
ED
Enable Deliver
The collection of processes associated with managing and monitoring Deliver process data, performance and relationships.
Process Categories
ED.1: Manage Deliver Business Rules The process of dening and maintaining rules which aect the acceptance of an order, based on quantity, method of delivery, credit, customer experience, etc. (Include distribution channel rules) The process of dening the requirement and monitoring the performance of the delivery of product to a customer. When physical delivery is out-sourced the performance is passed on to source for contract administration. The process of collecting, maintaining, and communicating information to support deliver planning and execution processes. The information to be managed includes: order data - (customer preference, history, status, and delivery requirements, etc.), warehouse data, transportation data, and deliver data. The process of establishing and maintaining nished goods, inventory limits or levels, replenishment models, ownership, product mix, stocking locations Acquisition, maintenance, and disposition of order management, warehouse and transportation capital assets. Determine material handling (inventory) pick pack & ship methods (inventory), and equipment. The process of 1) dening and maintaining the information which characterizes product, containerization, vehicle, route, terminals, regulations, rates/taris and backhaul opportunity (Characterization include information necessary to support maintenance of internal Outbound Transportation equipment CAPITAL ASSETS) and 2) the management of transporters. The process of dening and maintaining the distribution channel/ network for a specic product line (no capital asset or transportation management). The process of recording and maintaining regulations and rates, which constrain the ordering and delivering of product The process of managing Deliver risks within an overall Supply Chain Risk Program. This includes identifying and assessing Deliver risks as well as and planning and implementing responses to Deliver risks. Delivery risks include all potential events that could impact companys ability to deliver on-time at a reasonable cost and quality. In particular, the risk areas addressed are Transportation (weather related transportation issues, ocean freight), Inventory management (accuracy, stock-out, damaged inventory.), Order management (fulllment accuracy, delayed delivery), and Document compliance (invoicing issue, customs procedures).
ED.3: Manage Deliver Information
ED.4: Manage Finished Goods Inventories ED.5: Manage Deliver Capital Assets
ED.6: Manage Transportation
ED.7: Manage Product Life Cycle
ED.8: Manage Import/Export Requirements ED.9: Manage Supply Chain Deliver Risk
3.4.72
ED
Management Process Reports ED.2 Con guration Rules ED.1 Planning Decision Policies EP.1 Supply-Chain Performance Metrics ES.4, EM.2, ED.2, ER.2
! ED.1 ! ! ED.2 ! ! ED.3 ! ! ED.4 ! ! ED.5 ! ! ED.6 ! ! ED.7 ! ! ED.8 ! ! ED.9 !
Order Rules D1.2, D2.2, D3.2, ED.4, ED.5 Con guration Rules ED.1
Carrier Contracts (Customer) Benchmark Data Customer Order D1.2, D2.3, D3.2, D3.3 Delivery Performance ED.4, ED.5, ED.6
Management Process Reports ED.1 Supply-Chain Performance Metrics ED.1, ED.5, EP.2 Customer Service Requirements ED.6
Booked Order D2.2 Contract Status D1.2, D2.2, D3.1 Customer Address Data D1.2, D2.2, D3.1 Shipping Preferences (Customer) D1.2, D2.2, D3.1 Credit History D1.2, D2.2, D3.1 Purchase History D1.2, D2.2, D3.1
Customer Master Database/Up to Date ED.4
Customer Master Database/Up to Date ED.3 Order Rules ED.1 Returns Data ED.8 Scrap Authorization ED.8 Product Mix and Plans Existing Inventory Data S1.4, S2.4, S3.6, D1.8 Integrated Supply Chain Plan Inventory Rules ED.4 Order Rules ED.1 Budgets Approved Item Master Supply-Chain Performance Metrics ES.4, EM.2, ED.2, ER.2 Inventory Rules ED.4
Finished Goods Inventory Location S1.4, S2.4, S3.6 Finish Goods Inventory Target Levels P4.2 Delivery Performance ED.2 Inventory Rules ED.4
Delivery Performance ED.2 Warehouse Operating Constraints
Contract Carrier Rates ES.8 Air, Ground, Carrier Rate Tables Projected Delivery Requirements EM.7 Standard Practices/Rules Customer Service Requirements ED.2 Customer Order Size, Weight, and Freight Class D2.2, D3.2
Delivery Performance ED.2 Shipping Parameters and Documentation D1.11, D2.11, D3.11
Product Mix and Plans Location of Customers D1.2, D2.2, D3.2 Budgets Government Constraints ED.8 Current Inventory Source Data ES.3 Revised Business Assumptions EP.10, EP.5
Enterprise Distribution Model
Shipping History D1.11, D2.11, D3.11 Government Regulations Receipt Veri cation S1.2, S1.3, S2.2, S2.3, S3.4, S3.5 Tari s & Duties
Shipping Export Parameters and Documentation D1.11, D2.11, D3.11 Scrap Authorization ED.4 Government Constraints ED.7 Returns Data ED.4 Duty Drawback Claims
3.4.73
ED.1
Manage Deliver Business Rules
The process of dening and maintaining rules which aect the acceptance of an order, based on quantity, method of delivery, credit, customer experience, etc. (Include distribution channel rules)
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Integrated Edit at Order Entry Time On-Line Rule Base Include environmental requirements Metric None Identied Manage Deliver Business Rules Cycle Time None Identied Cost to Manage Deliver Business Rules None Identied Description/Denition Customer Master Record None identied Include environmental requirements in deliver rules
Inputs
Management Process Reports ED.2 Con guration Rules ED.1 Planning Decision Policies EP.1 Supply-Chain Performance Metrics ES.4, EM.2, ED.2, ER.2
> ED.1
Outputs
Rules > OrderD2.2, D3.2, ED.4, ED.5 D1.2, Con guration Rules ED.1
3.4.74
ED.2
Assess Delivery Performance
The process of dening the requirement and monitoring the performance of the delivery of product to a customer. When physical delivery is out-sourced the performance is passed on to source for contract administration.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Real Time Package Tracking Customer Initiated Package Tracking Metric Documentation Accuracy, Perfect Condition Assess Delivery Performance Cycle Time None Identied Cost to Assess Delivery Performance None Identied Description/Denition Tracking and tracing WEB based Shared systems
Inputs
Carrier Contracts (Customer) Benchmark Data Customer Order D1.2, D2.3, D3.2, D3.3 Delivery Performance ED.4, ED.5, ED.6
Outputs
Management Process Reports ED.1
> ED.2
> Supply-Chain Performance Metrics

ED.1, ED.5, EP.2 Customer Service Requirements ED.6
3.4.75
ED.3
Manage Deliver Information
The process of collecting, maintaining, and communicating information to support deliver planning and execution processes. The information to be managed includes: order data - (customer preference, history, status, and delivery requirements, etc.), warehouse data, transportation data, and deliver data.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Provide Single Source of Information on the Customer (Single Group / Owner Responsible for Accuracy / Quality of Customer Data) Online Real-Time Customer Entry and Edit Metric None Identied Manage Deliver Information Cycle Time None Identied Cost to Manage Deliver Information None Identied Description/Denition Secure E-Commerce Server and integrated Order Management System (OMS) Warehouse Management System (WMS) and Transportation Management System (TMS) On-line Customer Service Module CRM (Customer resource Management) software is getting a big push in the E-Commerce/E-Business areas and generally provides a means to fulll this requirement None identied None identied
Customer Service Data Validation Including Geo-Coding Comprehensive History of Customer Interactions Including Order History, Claims, Problems, Etc. Customer Access to Online Tracking of Order Status and Shipping Information
Internet-enabled package/shipment tracking
3.4.76
ED.3
Inputs
Booked Order D2.2 Contract Status D1.2, D2.2, D3.1 Customer Address Data D1.2, D2.2, D3.1 Shipping Preferences (Customer) D1.2, D2.2, D3.1 Credit History D1.2, D2.2, D3.1 Purchase History D1.2, D2.2, D3.1
Outputs
> ED.3
> Customer Master Database/Up to Date

ED.4
3.4.77
ED.4
Manage Finished Goods Inventories
The process of establishing and maintaining nished goods, inventory limits or levels, replenishment models, ownership, product mix, stocking locations
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Real Time Data on Current Status Statistical Test Count Metric % of Orders Delivered In Full Manage Finished Goods Inventories Cycle Time None Identied Finished Goods Inventory Days of Supply, Cost to Manage Finished Goods Inventories Inventory Days of Supply , % of hazardous material in inventory Description/Denition Dynamic calculation of safety stock based on actual sales. The Statistical Test Count (STC) process is a method of validating inventory on-hand values by physically counting and reconciling a statistical sample of the entire inventory population. This sample is then extrapolated across the inventory population, which provides an indicative measure of entire inventory population. Furthermore, with extrapolation the net and gross percentage of error is determined. Manage hazardous inventory Spill control Real time view of data.
Manage hazardous inventory Spill control Periodic Review of Metrics and Strategy with Comparisons to Industry Benchmarks
3.4.78
ED.4
Inputs
Customer Master Database/Up to Date ED.3 Order Rules ED.1 Returns Data ED.8 Scrap Authorization ED.8 Product Mix and Plans Existing Inventory Data S1.4, S2.4, S3.6, D1.8 Integrated Supply Chain Plan Inventory Rules ED.4
Outputs
Finished Goods Inventory Location S1.4, S2.4, S3.6
> ED.4
> Finish Goods Inventory Target Levels

P4.2 Delivery Performance ED.2 Inventory Rules ED.4
3.4.79
ED.5
Manage Deliver Capital Assets
Acquisition, maintenance, and disposition of order management, warehouse and transportation capital assets. Determine material handling (inventory) pick pack & ship methods (inventory), and equipment.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Measure Customer Service Metric Reportable Release Incidents Manage Deliver Capital Assets Cycle Time None Identied Cost to Manage Deliver Capital Assets None Identied Description/Denition Advanced Shipping Notices (ASN)Parcel and Container Routing and Rating Compliance Labeling Real time shipment tracking None identied Automated or Optimized Slotting (Storage Location) Systems Automated Item Cubing and Weighting systems Scanning with RFID/Bar-codes systems Automated Calculation of ABC Velocity Movement
Standard Operating Procedures and Methodology Storage Location Zoning Facility Master Plan Automated Data Entry Removal of Obsolete Stock
Inputs
Order Rules ED.1 Budgets Approved Item Master Supply-Chain Performance Metrics ES.4, EM.2, ED.2, ER.2 Inventory Rules ED.4
Outputs
> ED.5
> ED.2
Delivery Performance Warehouse Operating Constraints
3.4.80
ED.6
Manage Transportation
The process of 1) dening and maintaining the information which characterizes product, containerization, vehicle, route, terminals, regulations, rates/taris and backhaul opportunity (Characterization include information necessary to support maintenance of internal Outbound Transportation equipment - CAPITAL ASSETS) and 2) the management of transporters.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Rating & Routing Integrated Order Management, Warehouse Management, and Transportation Management Systems View for analysis for all orders and shipments the following data: Logistics, Product, Cost, GL Charging Real-Time Shipment Tracking, (via internet) Backhaul Trading Exchange View for Analysis for All Orders and Shipments the Following Data: Logistics, Product, Cost, GL Charging Manage Information Across 100% of Shipments Appointment Scheduling for Pickup and Delivery of Customer Shipments Electronic Manifest and Electronic Billing Automated Documentation for International Shipments Real-Time Optimized Shipment Method Selection (Air Parcel, Ground Parcel, LTL, etc.) Based on Customer Service Requirements Metric None Identied Manage Transportation Cycle Time None Identied % of vehicle fuel derived from alternative fuels, Cost to Manage Transportation None Identied Description/Denition Internet Pooling (Electronic brokerage of shipments Transportation Management System (TMS) Maintenance Management
Transportation Management System (TMS) Maintenance Management Pooling Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management
3.4.81
ED.6
Best Practices cont. Measurement of Carrier Performance for Ontime Delivery and Completeness Capture and Maintain Mode Specic Data Description/Denition cont. Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management
Inputs
Contract Carrier Rates ES.8 Air, Ground, Carrier Rate Tables Projected Delivery Requirements EM.7 Standard Practices/Rules Customer Service Requirements ED.2 Customer Order Size, Weight, and Freight Class D2.2, D3.2
Outputs
> ED.6
> Shipping Parameters and Documentation

D1.11, D2.11, D3.11
Delivery Performance ED.2
3.4.82
ED.7
Manage Product Life Cycle
The process of dening and maintaining the distribution channel/ network for a specic product line (no capital asset or transportation management).
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Take-back program Integrated Facility Management Operations and Network Analysis Standard Operating Procedures and Methodology Plan for proper product disposal Metric None Identied Manage Product Life Cycle Time None Identied Cost to Manage Product Life Cycle None Identied Description/Denition Take-back program at end of product life None identied None identied None identied Plan for proper product disposal
Inputs
Product Mix and Plans Location of Customers D1.2, D2.2, D3.2 Budgets Government Constraints ED.8 Current Inventory Source Data ES.3 Revised Business Assumptions EP.10, EP.5
> ED.7
> Enterprise Distribution Model
Outputs
3.4.83
ED.8
Manage Import/Export Requirements
The process of recording and maintaining regulations and rates, which constrain the ordering and delivering of product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Multi-country Export/Import documentation compliance Assessing Export/Import Requirements during Time of Product Development/Manufacture Documents Generated Automatically During Shipment Preparation. Manage foreign environmental requirements Direct Connection to Customs Clearance Ability to Track Component/ Sub-Component Manufacturing Country of Origin Direct Transfer of Documents to Recipient and Forwarder Metric None Identied Customs Clearance Cycle Time, Manage Import/Export Requirements Cycle Time None Identied Cost to Manage Import/Export Requirements None Identied Description/Denition None identied Multi-country Export/Import documentation compliance
Electronic documentation submission via EDI and/or internet.
Manage foreign environmental requirements Electronic documentation submission via EDI and/or internet. Component/lot tracking (lot trace-ability)
3.4.84
ED.8
Outputs Inputs
Shipping History D1.11, D2.11, D3.11 Government Regulations Receipt Veri cation S1.2, S1.3, S2.2, S2.3, S3.4, S3.5 Tari s & Duties Shipping Export Parameters and Documentation D1.11, D2.11, D3.11
> ED.8
> Scrap Authorization ED.4

Government Constraints ED.7 Returns Data ED.4 Duty Drawback Claims
3.4.85
ED.9
Manage Supply Chain Deliver Risk
The process of managing Deliver risks within an overall Supply Chain Risk Program. This includes identifying and assessing Deliver risks as well as and planning and implementing responses to Deliver risks. Delivery risks include all potential events that could impact companys ability to deliver on-time at a reasonable cost and quality. In particular, the risk areas addressed are Transportation (weather related transportation issues, ocean freight), Inventory management (accuracy, stock-out, damaged inventory.), Order management (fulllment accuracy, delayed delivery), and Document compliance (invoicing issue, customs procedures).
Performance Attributes Supply Chain Reliability Metric Value at Risk (Deliver), Age of Product / Customer Risk Data (months), VAR of Supplier Performance, Supplier Mitigation Plans Implemented (percent), VAR of Internal Process Performance, VAR of product/customer performance - , Age of Supplier Risk Data (months) External Event Response (average days) Industry Benchmark Comparison (%), Options Rating (0-100%), Hedge Rating (Inventory DOS for risk management), Internal Event Response (average days) Mitigation cost by Event ($), Mitigation Cost ($), Assessment / Risk Management Costs ($) Gross Risk ($), Event Risk (EVAR) ($), Mitigated Risk ($), Residual Risk ($), Supply / Customer / Product Base Rated (%), Individual Process Area Event Rating (EVAR) ($) Description/Denition This practice involves establishing business rules (e.g., customer priority, supplier priority, production routing, transportation routing, etc.) based on minimizing the risk to the supply chain. Under this practice, business rules are established or congured in response to the corporate risk management plan with a goal of reducing either the likelihood of a disruption occurring or the impact to the supply chain should a disruption occur. Business rule reconguration typically includes an assessment of the impact of each rule change on the overall supply chain before actual implementation.
Supply Chain Costs
Best Practices Supply Chain Business Rules Congured to mitigate risk
3.4.86
ED.9
Best Practices cont. Supply Chain Risk Identication Description/Denition cont. A key aspect of supply chain risk management is identication. Identication involves creating a list of potential events that could harm any aspect of the supply chains performance. Risk identication allows an organization to take steps to create plans to manage risks before they occur. this is typically more cost eective then waiting to react to adverse events when they occur. Supply Chain Risk assessment provides management with an understanding of where the greatest risks may exist in order to prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of the risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events. the team can then prioritize addressing the risks. This practice relies on a risk evaluation of the supply chain to guide the design of the supply chain network. Node locations, transportation routes, capacity size and location, number of suppliers, number of production locations, etc. are all determined in a fashion that mitigates potential disruptions to the ability to deliver product and service to the end customer. This practice relies on the information collected through risk identication and risk assessment processes to identify nodes that are at a high risk of disruption due to the location of the node. Location specic risks can include tactical strike risks, natural disaster risks, single point of failure risks, etc. Supply Chain Risk Monitoring Once areas of risk have been identied, an organization needs to monitor their internal and external environment. This helps them to predict when risky events are becoming more likely. It also helps to identify new risks and is tightly linked to the best practice of Supply Chain Risk Identication. This practice involves managing supply chain information networks to minimize the risk to the supply chain. This includes information sharing with partners as well as internal locations. This helps all parties to be quickly informed of a real or potential disruption and respond quickly and appropriately to minimize the disruption impact. Open communication is necessary for eective risk management, where the term open refers to the possibility to directly reach the right person who can better handle the information about a crisis situations wherever in the organization. Managers require direct communication channels up, down and across their business units to help identify risks and take appropriate actions.
Supply Chain Network Congured to Mitigate Risk
3.4.87
ED.9
Best Practices cont. Supply Chain Risk Management Description/Denition cont. Supply chain risk management is the systematic identication, assessment and mitigation of potential disruptions in logistics networks with the objective to reduce their negative impact on the logistics networks performance.
Inputs
Outputs
> ED.9

3.4.88
R
Return
The processes associated with moving material from a customer back through the supply chain to address defects in product, ordering, or manufacturing, or to perform upkeep activities.
Process Categories SR1: Source Return Defective Product The return and disposition determination of defective products as dened by the warranty claims, product recall, non-conforming product and/or other similar policies including appropriate replacement. The Return Defective Product supports any type of product not conforming to specications (including order non-conformance such as late or otherwise improper delivery); company business rules determine the denition of defective. The physical disposition of the product may not be part of the return process. The receipt and disposition determination of defective products as dened by the warranty claims, product recall, non-conforming product and/or other similar policies including appropriate replacement. The Return Defective Product supports any type of product not conforming to specications (including order non-conformance such as late or otherwise improper delivery); company business rules determine the denition of defective. The physical disposition of the product may not be part of the return process. The return of Maintenance, Repair and Overhaul (MRO) products or company assets for the purpose of servicing, repairing or upgrading it, as dened by Maintenance Plans or the occurrence or anticipation of risk of failure. Generally company assets managed through a MRO process are expected to be refurbished to a useable condition and returned to service. The Return process does not represent the actual maintenance, repair or overhaul activities; these are generally represented by Make processes. The physical disposition of the product may not be part of the return process. The receipt of Maintenance, Repair and Overhaul (MRO) products or company assets for the purpose of servicing, repairing or upgrading it, as dened by Maintenance Plans or the occurrence or anticipation of risk of failure. Generally company assets managed through a MRO process are expected to be refurbished to a useable condition and returned to service. The Return process does not represent the actual maintenance, repair or overhaul activities; these are generally represented by Make processes. The physical disposition of the product may not be part of the return process.
SR2: Source Return MRO Product
3.5.1
R
SR3: Source Return Excess Product The return of excess or aging inventory or obsolete products as dened by the terms and conditions of a customer/ supplier contract. The intention of excess product returns is to reallocate inventory to a location or organization that can sell the product that is considered in excess in the current location. The physical disposition of the product may not be part of the return process. The receipt of excess or aging inventory or obsolete products as dened by the terms and conditions of a customer/ supplier contract. The intention of excess product returns is to reallocate inventory to a location or organization that can sell the product that is considered in excess in the current location. The physical disposition of the product may not be part of the return process. The collection of processes associated with managing and monitoring Return process data, performance and relationships.
DR3: Deliver Return Excess Product
ER: Enable Return
3.5.2
SR1
Source Return Defective Product
The return and disposition determination of defective products as dened by the warranty claims, product recall, non-conforming product and/or other similar policies including appropriate replacement. The Return Defective Product supports any type of product not conforming to specications (including order non-conformance such as late or otherwise improper delivery); company business rules determine the denition of defective. The physical disposition of the product may not be part of the return process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Order Fulllment Cycle Time, Source Return Cycle Time None Identied Cost to Source Return Return on Working Capital, Rebuild or recycle rate, Return on Supply Chain Fixed Assets Description/Denition None identied
3.5.3
SR1
Business Rules for Return Processes ES.1, ER.1 Warranty Data ER.8 Manage Regulatory Return Policy ER.8
! SR1.1 !
Return Defective Product
Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Returned Plans P5.4
! SR1.2 !
Return Inventory Availability SR1.3, SR1.4, SR1.5, SR2.3, SR2.4, SR2.5, SR3.3, SR3.4, SR3.5 Authorization to Return to Service D1.8 Return Product Location ER.4 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Authorization to Scrap D1.8
Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Returned Schedule Instructions DR1.2, DR2.2, DR3.2 Defective Product Return Authorization Response DR1.1 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4
! SR1.3 !
Ship-to Data SR1.4, SR2.4, SR3.4 Defective Product Return Authorization Request DR1.1 Historical Return Rates P5.1 Validated Return Material Authorization SR1.4, SR3.4 Defective Product Disposition Request DR1.1 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Credit/Exchange Options SR1.4, SR2.4, SR3.4
Validated Return Material Authorization SR1.3, SR3.3 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Return Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Credit Exchange Options SR1.3, SR2.3, SR3.3 Ship-to Data SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1 Plan and Build Loads Information D1.5
! SR1.4 !
Scheduled Defective Product Return SR1.5 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5
Return Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Return Defective Product SR1.2, SR2.2, SR3.2, ER.4 Scheduled Defective Product Return SR1.4 Load, Shipping, Verify, and Credit Information D1.11
! SR1.5 !
Shipment Documents Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5
3.5.4
SR1.1
Identify Defective Product Condition
The process where the customer utilizes planned policies, business rules and product operating conditions inspection as criteria to identify and conrm that material is excess to requirements defective.
Performance Attributes Supply Chain Reliability Supply Chain Asset Management Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Enterprise Level Policies/Rules with Local Execution Metric None Identied Value of Defective Inventory in Disposition Stage/ Total Inventory Value None Identied Cost of identifying the defective condition as a % of total Source cost None Identied Description/Denition Web based access to enterprise level business rules
Inputs
Business Rules for Return Processes ES.1, ER.1 Warranty Data ER.8 Manage Regulatory Return Policy ER.8
> SR1.1
Outputs > Return Defective Product
3.5.5
SR1.2
Disposition Defective Product
The process of the customer determining whether to return the defective item and the appropriate source contact for a return authorization.
Performance Attributes Supply Chain Reliability Supply Chain Asset Management Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Conrm Changes in Condition Code Policies Are Promptly Communicated to All Employees and Supply-Chain Partners. Conrm Asset Return Condition Codes Are Clearly Understood by All Employees, Especially Those Who Are New to the Process Drive Returns Directly to Return Stock Point of Disposition to Reduce Cost and Cycle Time Metric None Identied Value of Defective Inventory in Disposition Stage/ Total Inventory Value None Identied Defective product disposition costs as % total Source Return cost None Identied Description/Denition None identied
None identied
Specify return disposition location and time.
Outputs
Return Inventory Availability SR1.3, SR1.4, SR1.5, SR2.3, SR2.4, SR2.5, SR3.3, SR3.4, SR3.5
Inputs
Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Returned Plans P5.4
> SR1.2
> Return Product Location

ER.4 Authorization to Scrap D1.8
Authorization to Return to Service D1.8
Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5
3.5.6
SR1.3
Request Defective Product Return Authorization
The process of a customer requesting and obtaining authorization, from last known holder or designated return center, for the return of defective product. Additionally, the customer and last known holder or designated return center would discuss enabling conditions such as return replacement or credit, packaging, handling, transportation and import / export requirements to facilitate the ecient return of the defective product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain costs Supply Chain Costs Supply Chain Asset Management Best Practices Clarify Point of Contact and Return Location Develop and Clarify Mutually Understood Cycle Times to Process Return Authorizations Long-Term Return Agreements / Partnerships Enable Customer-Service Representatives to Complete the Bill Of Lading for the Customer Including Carrier Routing, Weight, Description and Class to Minimize Guesswork & Wrong Estimates Metric None Identied None Identied None Identied Ratio of Authorization Cost to Total Source Return cost Cost per request authorization Value of Defective Product Inventory in Request Return Authorization Stage/ Total Description/Denition Electronic rules for business relationships and transactions. Clarication as to who will pay in-bound and out-bound freight cost. None identied Clarication of policy if authorizations are not processed within the expected cycle time.
3.5.7
SR1.3
Outputs Inputs
Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Returned Schedule Instructions DR1.2, DR2.2, DR3.2 Defective Product Return Authorization Response DR1.1 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Ship-to Data SR1.4, SR2.4, SR3.4 Defective Product Return Authorization Request DR1.1
> SR1.3
> Validated Return Material

Authorization SR1.4, SR3.4 Defective Product Disposition Request DR1.1 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Credit/Exchange Options SR1.4, SR2.4, SR3.4
Historical Return Rates P5.1
3.5.8
SR1.4
Schedule Defective Product Shipment
The process where the customer develops the schedule for a carrier to pick-up for delivery of the defective product. Activities include selecting the carrier and rates, preparing the item for transfer, preparing scheduling documentation and managing overall scheduling administration.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Transportation Modeling and Rate Analysis Consolidation of Return Carriers Carrier Selection Based on Performance Criteria at Least Cost Metric % Shipping Schedules that Support Customer Required Return by Date None Identied None Identied % Defective Product Scheduling Cost to Total Source Return Cost Value of defective product in scheduling stage/ total defective product Description/Denition None identied Outbound logistics software to assist with route. Scheduling, carrier selection, and rating
Inputs
Validated Return Material Authorization SR1.3, SR3.3 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Return Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Credit Exchange Options SR1.3, SR2.3, SR3.3 Ship-to Data SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1 Plan and Build Loads Information D1.5
Outputs
> SR1.4
>
Scheduled Defective Product Return SR1.5 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5
3.5.9
SR1.5
Return Defective Product
The process where the customer packages, and handles the defective product in preparation for shipping in accord with pre-determined conditions. The product is then provided by the customer to the carrier who physically transports the product and its associated documentation to the last known holder or designated return center.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Advanced Shipping Notice Shipment Tracking and Tracing Metric % Error-free Returns Shipped, Return Shipments Shipped on Time None Identied None Identied Return transportation costs, Cost per request authorization Rebuild or recycle rate, Value of defective product inventory in physical return Description/Denition Integrated data sharing with repair facility. Satellite communications, GPS, RFID
Inputs
Return Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Return Defective Product SR1.2, SR2.2, SR3.2, ER.4 Scheduled Defective Product Return SR1.4 Load, Shipping, Verify, and Credit Information D1.11
Outputs
> SR1.5
> Returned Defective Product

Shipment Documents SR1.2, SR1.3, SR1.4, SR1.5
3.5.10
DR1
Deliver Return Defective Product
The receipt and disposition determination of defective products as dened by the warranty claims, product recall, non-conforming product and/or other similar policies including appropriate replacement. The Return Defective Product supports any type of product not conforming to specications (including order non-conformance such as late or otherwise improper delivery); company business rules determine the denition of defective. The physical disposition of the product may not be part of the return process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Order Fulllment Cycle Time, Deliver Return Cycle Time None Identied Cost to Deliver Return Return on Working Capital, Return on Supply Chain Fixed Assets, Value of defective product inventory/ total defective product inventory value, Return Rate
3.5.11
DR1
Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Defective Product Return Authorization Request SR1.3 Business Rules for Return Processes ES.1, ER.1 Return Plans P5.4 Defective Product Disposition Request SR1.3 Pruduct Return Capabilities P5.4
!DR1.1!
Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Valid Returns Request DR1.2, DR2.2 Historical Return Rates P5.1 Ship-to Data SR1.4, SR2.4, SR3.4 Defective Product Return Authorization Response SR1.3
Valid Returns Request DR1.1, DR2.1
!DR1.2!
Return Schedule Instructions DR1.1, DR2.1, DR3.1 Valid Returns Request SR1.3, SR2.3, SR3.3, DR1.3, DR2.3, DR3.3
Return Transportation Guidelines, Policies, & Agreements ER.6 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Receipt Data ER.3, ER.4 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Return Regulatory Requirements ER.8
!DR1.3!
Receipt Discrepancy Notication
Sourcing Plans P2.4 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Return Inventory for Transfer ER.4
!DR1.4!
Defective Products S1.2, S2.2 Return Inventory Transfer Data P5.2, S1.1, S2.1, S3.3, ER.4
3.5.12
DR1.1
Authorize Defective Product Return
The process where the last known holder or designated return center receives a defective product return authorization request from a customer, determines if the item can be accepted and communicates decision to the customer. Accepting the request would include negotiating the conditions of the return with the customer, including authorizing return replacement or credit. Rejecting the request would include providing a reason for the rejection to the customer.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Communicate with Customer before the Return to Establish What Types of Returns Are Acceptable Avoid returns beyond economic repair Set Up Electronic or Pre-authorized Returns Use an Exchange System Where Customer is Issued a Serviceable Item Upon Submitting an Unserviceable Item Metric None Identied Authorize Defective Product Return Cycle Time None Identied Cost to Authorize Defective Product Return Value of Defective Product Inventory in Request Return Authorization Stage/ Total Description/Denition None identied
Estimate damage to product and do not physically return product that is beyond economical repair or oers no diagnostic value None identied None identied
3.5.13
DR1.1
Inputs
Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Defective Product Return Authorization Request SR1.3 Business Rules for Return Processes ES.1, ER.1 Return Plans P5.4 Defective Product Disposition Request SR1.3 Pruduct Return Capabilities P5.4
Outputs
Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1
> DR1.1
> Historical Return Rates

P5.1 Ship-to Data SR1.4, SR2.4, SR3.4 Defective Product Return Authorization Response SR1.3
3.5.14
DR1.2
Schedule Defective Return Receipt
The process where the last known holder or designated return center evaluates the defective product handling requirements including negotiated conditions and develops a schedule that tells the Customer when to ship the product. The scheduling activity would also inform Receiving when to expect the shipment and where to send the product, for disposition, upon receipt.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Integrate Return Planning with Maintenance and Inventory Planning to Optimize the System Metric None Identied Schedule Defective Return Receipt Cycle Time None Identied Cost to Schedule Defective Product Receipt None Identied Description/Denition Both customer and Service Provider departments are alerted at the same time and viewing the same information.
Outputs Inputs
> DR1.2
Request > Valid ReturnsSR3.3, DR1.3, SR1.3, SR2.3, DR2.3, DR3.3
Return Schedule Instructions DR1.1, DR2.1, DR3.1
3.5.15
DR1.3
Receive Defective Product (includes verify)
The process where the last known holder or designated return center receives and veries the returned defective product against the return authorization and other documentation and prepares the item for transfer.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Develop Local Receiving Process Close to Repair Receivers on the Dock Communicate Directly with the Buyer to Eciently Resolve Any Discrepancies Pre-Certify Supplier Capability to Send Return Products Correctly to Minimize the Need for Receipt Verication Customer Sends Receiving Advanced Shipment Notication Prior to Shipment Electronically Track Shipment from Customer to Service Provider Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Metric None Identied Receive Defective Product Cycle Time None Identied Cost to Receive Defective Product, Energy Costs None Identied Description/Denition Minimize time spent in product movement. Buyers name for every receipt is clearly visible on Receiver.
Push inspection to SOURCE Receiving quality criteria connected to ISO 9000 practices
Electronically link Return authorization, Return schedule and shipping documents. . None Identied Bar code interface for data collection devices Generate bar coded receiving documents. Product serial number used as identier RFID
3.5.16
DR1.3
Inputs
Return Transportation Guidelines, Policies, & Agreements ER.6 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Receipt Data ER.3, ER.4 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Return Regulatory Requirements ER.8
> DR1.3
> Receipt Discrepancy Notication
Outputs
3.5.17
DR1.4
Transfer Defective Product
The process where the last known holder or designated return center transfers the defective product to the appropriate process to implement the disposition decision.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Defective Products Scheduling Identies Next Destination (Source, Make, or Deliver) on Return Authorization Receiving Equipment and Packaging Materials to Transfer Product Are Planned for In Advance and Readily Available When Needed Return Process Electronically Tracks Transfer from Station to Station Review Transfer Cycle Time Trends and Determine If Equipment Capacity is Properly Balanced with Projected Usage Metric None Identied Transfer Defective Product Cycle Time None Identied Cost to Transfer Defective Product None Identied Description/Denition Utilize electronic links
Include packaging materials in inventory management system and treat as any other inventory to minimize potential of stock-out.
Utilize Bar coding Periodic review of capital asset plan to determine if additional equipment, if needed, can be funded.
Inputs
Sourcing Plans P2.4 Returned Defective Product SR1.2, SR1.3, SR1.4, SR1.5 Return Inventory for Transfer ER.4
Outputs
> DR1.4
> Return Inventory Transfer Data

P5.2, S1.1, S2.1, S3.3, ER.4
Defective Products S1.2, S2.2
3.5.18
SR2
Source Return MRO Product
The return of Maintenance, Repair and Overhaul (MRO) products or company assets for the purpose of servicing, repairing or upgrading it, as dened by Maintenance Plans or the occurrence or anticipation of risk of failure. Generally company assets managed through a MRO process are expected to be refurbished to a useable condition and returned to service. The Return process does not represent the actual maintenance, repair or overhaul activities; these are generally represented by Make processes. The physical disposition of the product may not be part of the return process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric None Identied Order Fulllment Cycle Time None Identied Total Source Return Costs Return on Working Capital, Rebuild or recycle rate, Return on Supply Chain Fixed Assets
3.5.19
SR2
Manage Regulatory Return Policy ER.8 Warranty Data ER.8 Business Rules for Return Processes ES.1, ER.1
! SR2.1 !
Returned MRO Products SR2.2, SR2.3, SR2.4, SR2.5, DR2.3, DR2.4
Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Return Plans P5.4
! SR2.2 !
Return Inventory Availability SR1.3, SR1.4, SR1.5, SR2.3, SR2.4, SR2.5, SR3.3, SR3.4, SR3.5 Authorization to Return to Service D1.8 Authorization to Scrap D1.8 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Return Product Location ER.4
Retrun Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Return Schedule Instructions DR1.2, DR2.2, DR3.2 MRO Return Authorization, Response DR2.1 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5
! SR2.3 !
Credit/Exchange Options SR1.4, SR2.4, SR3.4 MRO Return Authorization Request DR2.1 Historical Return Rates P5.1 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 MRO Disposition Request DR2.1 Ship-to Data SR1.4, SR2.4, SR3.4
Ship-to Data SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1 Credit/Exchange Options SR1.3, SR2.3, SR3.3 Returned Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Plan And Build Loads Information D1.5
! SR2.4 !
Scheduled MRO Return SR2.5
Scheduled MRO Return SR2.4 Returned Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Load, Shipping, Verify, and Credit Information D1.11
! SR2.5 !
Returned MRO Product SR2.1, SR2.2, SR2.3, SR2.5 Shipping Documents
3.5.20
SR2.1
Identify MRO Product Condition
The process where the customer utilizes pre-determined MRO policies, business rules and product operating conditions as criteria to identify and conrm that an item requires maintenance, repair, overhaul or disposal. Includes operating failures and planned maintenance requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices None Identied Metric Total # of Conrmed MRO Conditions/Total # of MRO Service Requests Initiated None Identied None Identied Cost of Identifying the MRO Condition as a % of Total Source Return Cost Value of Unserviceable MRO Inv. in Identication Stage/ Total MRO Inv. Value Description/Denition None identied
Inputs
Manage Regulatory Return Policy ER.8 Warranty Data ER.8 Business Rules for Return Processes ES.1, ER.1
Outputs
> SR2.1
>
Returned MRO Products SR2.2, SR2.3, SR2.4, SR2.5, DR2.3, DR2.4
3.5.21
SR2.2
Disposition MRO Product
The process of the customer determining whether to service the item, what service is required, and who the appropriate service provider would be to service the item. Outputs include a decision to: (1) send a return authorization request to a service provider, (2) send the product back into service without requiring a return authorization request, or (3) discard the item.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric % Identied MRO Products Returned To Service None Identied None Identied MRO Disposition Costs As % Total Source cost Value of Defective Inventory in Disposition Stage/ Total Inventory Value, Value of Unserviceable MRO Inventory In Disposition Stage/ Total MRO Inventory Va
Outputs
Inputs
Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Return Plans P5.4
> SR2.2
>
Authorization to Return to Service D1.8 Authorization to Scrap D1.8 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Return Product Location ER.4
3.5.22
SR2.3
Request MRO Return Authorization
The process of a customer requesting and obtaining authorization, from a service provider, for the return of an MRO product. In addition to discussing the MRO issue, the customer and service provider would discuss enabling conditions such as return replacement or credit, packaging, handling, transportation and import / export requirements to facilitate the ecient return of the MRO product to the service provider. The customer may need to go through several return authorization iterations with multiple service providers before authorization is received.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied None Identied None Identied Cost per request authorization, Ratio of authorization costs to total source return cost , % of authorization request transmitted error-free/total authorization requests Value of Unserviceable MRO Inventory in Request Return Authorization Stage/ Total
Outputs Inputs
Retrun Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Return Schedule Instructions DR1.2, DR2.2, DR3.2 MRO Return Authorization, Response DR2.1 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Credit/Exchange Options SR1.4, SR2.4, SR3.4 MRO Return Authorization Request DR2.1
> SR2.3
> Historical Return Rates P5.1
Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 MRO Disposition Request DR2.1 Ship-to Data SR1.4, SR2.4, SR3.4
3.5.23
SR2.4
Schedule MRO Shipment
The process where the customer develops the schedule for a carrier to pick-up and deliver the MRO product. Activities include selecting the carrier and rates, preparing the item for transfer, preparing scheduling documentation and managing overall scheduling administration.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Carrier Selection Based on Performance Criteria at Least Cost Transportation Modeling and Rate Analysis Consolidation of Return Carriers Metric % Shipping Schedules that Support Customer Required Return by Date None Identied None Identied % MRO Scheduling Cost to Total Source Return Cost Value of Unserviceable MRO Inventory in Scheduling Stage/ Total MRO Inventory Description/Denition Scheduling, carrier selection, and rating None identied Outbound logistics software to assist with route.
Inputs
Ship-to Data SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1 Credit/Exchange Options SR1.3, SR2.3, SR3.3 Returned Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Plan And Build Loads Information D1.5
> SR2.4
> Scheduled MRO Return SR2.5
Outputs
3.5.24
SR2.5
Return MRO Product
The process where the customer packages, and handles the MRO product in preparation for shipping in accord with pre-determined conditions. The product is then provided by the customer to the carrier who physically transports the product and its associated documentation to the service provider.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Advanced Shipping Notice Shipment Tracking and Tracing Metric Return Shipments Shipped on Time, % Error-free Returns Shipped None Identied None Identied Cost per request authorization, Return transportation costs Value of unserviceable mro inventory in physical return and transportation stage/ Description/Denition Integrated data sharing with repair facility. Satellite communications, GPS, RFID
Inputs
Scheduled MRO Return SR2.4 Returned Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned MRO Products SR2.1, SR2.2, SR2.3, SR2.5 Load, Shipping, Verify, and Credit Information D1.11
Outputs
> SR2.5
> Returned MRO Product SR2.1, SR2.2, SR2.3, SR2.5

Shipping Documents
3.5.25
DR2
Deliver Return MRO Product
The receipt of Maintenance, Repair and Overhaul (MRO) products or company assets for the purpose of servicing, repairing or upgrading it, as dened by Maintenance Plans or the occurrence or anticipation of risk of failure. Generally company assets managed through a MRO process are expected to be refurbished to a useable condition and returned to service. The Return process does not represent the actual maintenance, repair or overhaul activities; these are generally represented by Make processes. The physical disposition of the product may not be part of the return process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric % of MRO returns delivered to the correct service provider location Order Fulllment Cycle Time, Deliver Return Cycle Time Upside Deliver Return Flexibility, Upside Deliver Return Adaptability Cost to Deliver Return Return on Working Capital, Value of Unserviceable MRO Inventory In Disposition Stage/ Total MRO Inventory Va, Return on Supply Chain Fixed Assets Description/Denition None identied
3.5.26
DR2
Return Plans P5.4 MRO Disposition Request SR2.3 Product Return Capabilities P5.4 MRO Return Authorization Request SR2.3 Business Rules for Return Processes ES.1, ER.1 Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1
!DR2.1!
Valid Returns Request DR1.2, DR2.2 Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 MRO Return Authorization Response SR2.3 Historical Return Rates P5.1 Ship-to Data SR1.4, SR2.4, SR3.4
!DR2.2!
Return Schedule Instructions SR1.3, SR2.3, SR3.3, DR1.3, DR2.3, DR3.3
Receipt Data ER.3, ER.4 Return Transportation Guidelines, Policies, & Agreements ER.6 Returned MRO Product SR2.1, SR2.2, SR2.3, SR2.5 Return Regulatory Requirements ER.8 Return Schedule Instructions DR1.2, DR2.2, DR3.2,
!DR2.3!
Return Inventory for Transfer ER.4 Returned MRO Product SR2.1, SR2.2, SR2.3, SR2.5 Sourcing Plans P2.4
!DR2.4!
Return Inventory Transfer Data P5.2, S1.1, S2.1, S3.3, ER.4 MRO Products S1.2, S2.2
3.5.27
DR2.1
Authorize MRO Product Return
The process where a service provider receives an MRO product return authorization request from a customer, determines if the item can be accepted for MRO and communicates their decision to the customer. Accepting the request would include negotiating the conditions of the return with the customer, including authorizing return replacement or credit. Rejecting the request would include providing a reason for the rejection to the customer.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Avoid returns beyond economic repair Set Up Electronic or Pre-authorized Returns Communicate with Customer before the Return to Establish What Types of Returns Are Acceptable Use an Exchange System Where Customer is Issued a Serviceable Item Upon Submitting an Unserviceable Item Metric None Identied Authorize MRO Product Return Cycle Time None Identied Cost to Authorize MRO Product Return None Identied Description/Denition Estimate damage to product and do not physically return product that is beyond economical repair or oers no diagnostic value None identied None identied
None identied
3.5.28
DR2.1
Inputs
Return Plans P5.4 MRO Disposition Request SR2.3 Product Return Capabilities P5.4 MRO Return Authorization Request SR2.3 Business Rules for Return Processes ES.1, ER.1 Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1
Outputs
Valid Returns Request DR1.2, DR2.2 Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Response SR2.3 Historical Return Rates P5.1 Ship-to Data SR1.4, SR2.4, SR3.4
> DR2.1
> MRO Return Authorization
3.5.29
DR2.2
Schedule MRO Return Receipt
The process where the service provider evaluates the MRO service requirements including negotiated conditions and develops a schedule that tells the Customer when to ship the part. The scheduling activity would also inform Receiving when to expect the shipment and where to send the part, for induction or storage, upon receipt.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Consolidate shipments where possible Integrate Return Planning with Maintenance and Inventory Planning to Optimize the System Metric None Identied Schedule MRO Return Receipt Cycle Time None Identied Cost to Schedule MRO Product Receipt None Identied Description/Denition Consolidate shipments where possible Both customer and Service Provider departments are alerted at the same time and viewing the same information.
Inputs
> DR2.2
Schedule Instructions > ReturnSR2.3, SR3.3, DR1.3, SR1.3, DR2.3, DR3.3
Outputs
3.5.30
DR2.3
Receive MRO Product
The process where the service provider receives and veries the returned MRO item against the return authorization and other documentation and prepares the item for transfer.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Electronically Track Shipment from Customer to Service Provider Develop Local Receiving Process Close to Repair Customer Sends Receiving Advanced Shipment Notication Prior to Shipment Receivers on the Dock Communicate Directly with the Buyer to Eciently Resolve Any Discrepancies Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Pre-Certify Supplier Capability to Send Return Products Correctly to Minimize the Need for Receipt Verication Metric None Identied Receive MRO Product Cycle Time None Identied Cost to Receive MRO Product None Identied Description/Denition None Identied Minimize time spent in product movement. Electronically link Return authorization, Return schedule and shipping documents. . Buyers name for every receipt is clearly visible on Receiver.
Bar code interface for data collection devices. Generate bar coded receiving documents. Product serial number used as identier RFID Push inspection to SOURCE Receiving quality criteria connected to ISO 9000 practices
3.5.31
DR2.3
Inputs
Receipt Data ER.3, ER.4 Return Transportation Guidelines, Policies, & Agreements ER.6 Returned MRO Product SR2.1, SR2.2, SR2.3, SR2.5 Return Regulatory Requirements ER.8 Return Schedule Instructions DR1.2, DR2.2, DR3.2,
> DR2.3
> Receipt Discrepancy Notication
Outputs
3.5.32
DR2.4
Transfer MRO Product
The process where the service provider transfers the MRO product to the appropriate process to implement the disposition decision.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Review Transfer Cycle Time Trends and Determine If Equipment Capacity is Properly Balanced with Projected Usage Receiving Equipment and Packaging Materials to Transfer Product Are Planned for In Advance and Readily Available When Needed Return Process Electronically Tracks Transfer from Station to Station MRO Scheduling Identies Next Destination (Stores or Repair Station) on Return Authorization Metric None Identied Transfer MRO Product Cycle Time None Identied Cost to Transfer MRO Product, Energy Costs None Identied Description/Denition Periodic review of capital asset plan to determine if additional equipment, if needed, can be funded.
Include packaging materials in inventory management system and treat as any other inventory to minimize potential of stock-out. Utilize Bar coding Utilize electronic links
Inputs
Return Inventory for Transfer ER.4 Returned MRO Product SR2.1, SR2.2, SR2.3, SR2.5 Sourcing Plans P2.4
Outputs
> DR2.4
> Return Inventory Transfer Data P5.2, S1.1, S2.1, S3.3, ER.4
MRO Products S1.2, S2.2
3.5.33
SR3
Source Return Excess Product
The return of excess or aging inventory or obsolete products as dened by the terms and conditions of a customer/supplier contract. The intention of excess product returns is to reallocate inventory to a location or organization that can sell the product that is considered in excess in the current location. The physical disposition of the product may not be part of the return process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric % of Excess Product Returns Delivered Complete to the Designated Return Center Order Fulllment Cycle Time, Source Return Cycle Time None Identied Total Excess Material Return Costs, Cost to Source Return Value of excess inventory/ total inventory value, Average age of Excess Inventory, Return on Working Capital, Return on Supply Chain Fixed Assets Description/Denition Enable direct shipments between customers to reduce overall transportation and handling.
Best Practices Enable customer direct shipments
3.5.34
SR3
Business Rules for Return Processes ES.1, ER.1 Manage Regulatory Return Policy ER.8
! SR3.1 !
Returned Excess Product SR3.2, SR3.3, SR3.4, SR3.5, DR3.3, DR3.4
Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Plans P5.4
! SR3.2 !
Authorization to Scrap D1.8 Authorization to Return to Service D1.8 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Product Location ER.4 Return Inventory Availability SR1.3, SR1.4, SR1.5, SR2.3, SR2.4, SR2.5, SR3.3, SR3.4, SR3.5
Excess Product Return Authorization Request SR3.3 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3
! SR3.3 !
Excess Product Return Authorization Request SR3.3 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3
Validated Return Material Authorization SR1.3, SR3.3 Credit/ Exchange Options SR1.3, SR2.3, SR3.3 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Plan and Build Loads Information D1.5 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Ship-to Data SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1
! SR3.4 !
Scheduled Excess Product Return SR3.5 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3
Load, Shipping, Verify, and Credit Information D1.11 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Scheduled Excess Product Return SR3.4
! SR3.5 !
Shipment Documents
3.5.35
SR3.1
Identify Excess Product Condition
The process where the customer utilizes planned policies, business rules and product inspection as criteria to identify and conrm that material is in excess of the current requirements.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric Number of occurences where excessive inventory is returned and followed None Identied None Identied Cost of identifying the excess condition as a % of total Source cost Return on Working Capital, Value of excess inventory in identication stage/ total inventory value Description/Denition Automated inventory planning package linked to real time demand data and inventory business rules. Web based access to enterprise level business rules
Best Practices Automated Inventory Visibility and Planning System to Highlight Inventory in Excess of Requirements Enterprise Level Policies/Rules with Local Execution
Inputs
Business Rules for Return Processes ES.1, ER.1 Manage Regulatory Return Policy ER.8
Outputs
> SR3.1
> Returned Excess Product DR3.3, SR3.2, SR3.3, SR3.4, SR3.5,

DR3.4
3.5.36
SR3.2
Disposition Excess Product
The process of the customer determining whether to return the excess material and identication of a designated return center a return authorization.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Drive Returns Directly to Return Stock Point of Disposition to Reduce Cost and Cycle Time Automated Registry of Inventory Return Locations by Item to Speed Identication of Proper Return Location Metric Number of occurrences of incorrect designated return center None Identied None Identied Excess product disposition costs as % total Source cost Value of Excess Inventory in Disposition Stage/ Total Inventory Value Description/Denition Specify return disposition location and time.
None identied
Outputs
Authorization to Scrap D1.8
Inputs
Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Plans P5.4
> SR3.2
> Returned Excess Product

SR3.1, SR3.2, SR3.4, DR3.3 Return Product Location ER.4
Authorization to Return to Service D1.8
3.5.37
SR3.3
Request Excess Product Return Authorization
The process of a customer requesting and obtaining authorization, from the designated return center, for the return of excess product. Additionally, the customer and designated return center would negotiate enabling conditions such as return credit or cash discount, packaging, handling, transportation and import / export requirements to facilitate the ecient return of the excess product.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Metric None Identied None Identied None Identied % of authorization request transmitted error-free/total authorization requests, Ratio of Authorization Cost To Total Source Cost, Cost per request authorization Value of Excess Product Inventory in Request Return Authorization Stage/ Total Ex Description/Denition Electronic rules for business relationships and transactions. Clarication as to who will pay in-bound and out-bound freight cost. Clarication of policy if authorizations are not processed within the expected cycle time.
Supply Chain Asset Management Best Practices Clarify Point of Contact and Return Location Develop and Clarify Mutually Understood Cycle Times to Process Return Authorizations Enable Customer-Service Representatives to Complete the Bill Of Lading for the Customer Including Carrier Routing, Weight, Description and Class to Minimize Guesswork & Wrong Estimates Long-Term Return Agreements / Partnerships
None identied
3.5.38
SR3.3
Outputs Inputs
Excess Product Return Authorization Request SR3.3 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Excess Product Return Authorization Request SR3.3 Ship-to Data SR1.4, SR2.4, SR3.4
> SR3.3
>
Excess Product Disposition Request DR3.1 Credit/ Exchange Options SR1.4, SR2.4, SR3.4 Validated Return Material Authorization SR1.4, SR3.4 Historical Return Rates P5.1
3.5.39
SR3.4
Schedule Excess Product Shipment
The process where the customer develops the schedule for a carrier to pick-up the excess product. Activities include selecting the carrier and rates, preparing the item for transfer, preparing scheduling documentation and managing overall scheduling administration.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Carrier Selection Based on Performance Criteria at Least Cost Arrange for Shipping Insurance in Case Of In-Transit Loss or Damage Consolidation of Return Carriers Transportation Modeling and Rate Analysis Metric % Shipping Schedules that Support Customer Required Return by Date None Identied None Identied % Excess Product Scheduling Cost to Total Source Return Cost Value of excess product in scheduling stage/ total excess product inv Description/Denition Scheduling, carrier selection, and rating Preventative management Outbound logistics software to assist with route. None identied
Inputs
Validated Return Material Authorization SR1.3, SR3.3 Credit/ Exchange Options SR1.3, SR2.3, SR3.3 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Plan and Build Loads Information D1.5 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Ship-to Data SR1.3, SR2.3, SR3.3, DR1.1, DR2.1, DR3.1
Outputs
> SR3.4
>
Scheduled Excess Product Return SR3.5 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3
3.5.40
SR3.5
Return Excess Product
The process where the customer packages, and handles the excess product in preparation for shipping in accord with pre-determined conditions. The product is then provided by the customer to the carrier who physically transports the product and its associated documentation to the last known holder or designated return center.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Shipment Tracking and Tracing Advanced Shipping Notice Metric % Error-free Returns Shipped, Return Shipments Shipped on Time None Identied None Identied Return transportation costs, Cost per request authorization Value of excess product inventory in physcial return and transportation stage/tot Description/Denition Satellite communications, GPS, RFID Integrated data sharing with repair facility.
Inputs
Load, Shipping, Verify, and Credit Information D1.11 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Inventory Availability SR1.2, SR2.2, SR3.2, ER.4 Scheduled Excess Product Return SR3.4
> SR3.5
Outputs > Shipment Documents
3.5.41
DR3
Deliver Return Excess Product
The receipt of excess or aging inventory or obsolete products as dened by the terms and conditions of a customer/supplier contract. The intention of excess product returns is to reallocate inventory to a location or organization that can sell the product that is considered in excess in the current location. The physical disposition of the product may not be part of the return process.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Metric % of Excess Product Returns Delivered Complete to the Designated Return Center Order Fulllment Cycle Time Upside Deliver Return Flexibility, Upside Deliver Return Adaptability None Identied Return for Recycle Rate, Return on Working Capital, Return on Supply Chain Fixed Assets Description/Denition Enable direct shipments between customers to reduce overall transportation and handling.
Best Practices Enable customer direct shipments
3.5.42
DR3
Business Rules for Return Processes ES.1, ER.1 Excess Product Return Authorization Request SR3.3 Excess Product Disposition Request SR3.3 Product Return Capabilities P5.4 Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Return Plans P5.4
!DR3.1!
Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Historical Return Rates P5.1 Ship-to Data SR1.4, SR2.4, SR3.4 Excess Product Return Authorization Response Return Product Authorization DR3.2
Return Product Authorization DR3.1
!DR3.2!
Return Schedule Instructions SR1.3, SR2.3, SR3.3, DR1.3, DR2.3, DR3.3
Return Regulatory Requirements ER.8 Receipt Data ER.3, ER.4 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Transportation Guidelines, Policies, & Agreements ER.6
!DR3.3!
Receipt Discrepancy Notication Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Inventory Transfer Data P5.2, S1.1, S2.1, S3.3, ER.4
Sourcing Plans P2.4 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Inventory for Transfer ER.4
!DR3.4!
Excess Products S1.2, S2.2 Return Inventory Transfer Data P5.2, S1.1, S2.1, S3.3, ER.4
3.5.43
DR3.1
Authorize Excess Product Return
The process where the designated return center receives an excess product return authorization request from a customer, determines if the item can be accepted and communicates their decision to the customer. Accepting the request would include negotiating the conditions of the return with the customer, including authorizing credit or cash discount. Rejecting the request would include providing a reason for the rejection to the customer.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Communicate with Customer before the Return to Establish What Types of Returns Are Acceptable Set Up Electronic or Pre-authorized Returns Metric None Identied Authorize Excess Product Return Cycle Time None Identied Cost to Authorize Excess Product Return None Identied Description/Denition None identied
None identied
Inputs
Business Rules for Return Processes ES.1, ER.1 Excess Product Return Authorization Request SR3.3 Excess Product Disposition Request SR3.3 Product Return Capabilities P5.4 Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1 Return Plans P5.4
Outputs
Manage Integrated Supply Chain Inventory Information DR1.1, DR2.1, DR3.1
> DR3.1
> Ship-to Data
Historical Return Rates P5.1 SR1.4, SR2.4, SR3.4 Excess Product Return Authorization Response Return Product Authorization DR3.2
3.5.44
DR3.2
Schedule Excess Return Receipt
The process where the l designated return center evaluates an authorized excess material return to determine packaging and handling requirements. This assessment will lead to the development of a return disposition decision and a return schedule with terms and conditions that will tell the Customer how and when to ship the product. The scheduling activity would also inform the Return Centers Receiving department when to expect the shipment and where to send the product, for disposition, upon receipt.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Establish Designated Processes for Scheduling and Receiving Excess Inventory Metric None Identied Schedule Excess Return Receipt Cycle Time None Identied Energy Costs, Cost to Schedule Excess Product Receipt None Identied Description/Denition None Identied
Inputs
Return Product Authorization DR3.1
> DR3.2
Outputs
Schedule Instructions > ReturnSR2.3, SR3.3, DR1.3, SR1.3, DR2.3, DR3.3
3.5.45
DR3.3
Receive Excess Product
The process where the designated return center receives and veries the returned excess product and associated documentation against the return authorization and other documentation and prepares the item for transfer. Administrate any discrepancies that arise.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Receivers on the Dock Communicate Directly with the Buyer to Eciently Resolve Any Discrepancies Develop Local Receiving Process Close to Repair Pre-Certify Supplier Capability to Send Return Products Correctly to Minimize the Need for Receipt Verication Electronically Track Shipment from Customer to Service Provider Customer Sends Receiving Advanced Shipment Notication Prior to Shipment Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy Metric None Identied Receive Excess Product Cycle Time None Identied Cost to Receive Excess Product None Identied Description/Denition Buyers name for every receipt is clearly visible on Receiver.
Minimize time spent in product movement. Push inspection to SOURCE Receiving quality criteria connected to ISO 9000 practices None Identied Electronically link Return authorization, Return schedule and shipping documents. . Bar code interface for data collection devices. Generate bar coded receiving documents. Product serial number used as identier. RFID
3.5.46
DR3.3
Inputs
Return Regulatory Requirements ER.8 Receipt Data ER.3, ER.4 Return Schedule Instructions DR1.2, DR2.2, DR3.2 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Transportation Guidelines, Policies, & Agreements ER.6
Outputs
> DR3.3
> Returned Excess Product

SR3.1, SR3.2, SR3.4, DR3.3 Return Inventory Transfer Data P5.2, S1.1, S2.1, S3.3, ER.4
3.5.47
DR3.4
Transfer Excess Product
The process where the designated return center transfers the excess product to the appropriate process to implement the disposition decision.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Receiving Equipment and Packaging Materials to Transfer Product Are Planned for In Advance and Readily Available When Needed Review Transfer Cycle Time Trends and Determine If Equipment Capacity is Properly Balanced with Projected Usage Excess Products Scheduling Identies Next Destination (Source, Make, or Deliver) on Return Authorization Return Process Electronically Tracks Transfer from Station to Station Metric None Identied Transfer Excess Product Cycle Time None Identied Cost to Transfer Excess Product None Identied Description/Denition Include packaging materials in inventory management system and treat as any other inventory to minimize potential of stock-out. Periodic review of capital asset plan to determine if additional equipment, if needed, can be funded.
Utilize electronic links
Utilize Bar coding
Inputs
Sourcing Plans P2.4 Returned Excess Product SR3.1, SR3.2, SR3.4, DR3.3 Return Inventory for Transfer ER.4
Outputs
> DR3.4
> Return Inventory Transfer Data

P5.2, S1.1, S2.1, S3.3, ER.4
Excess Products S1.2, S2.2
3.5.48
ER
Enable Return
The collection of processes associated with managing and monitoring Return process data, performance and relationships.
Process Categories ER.1: Manage Business Rules for Return Processes The process of establishing, maintaining, and enforcing decision support criteria for Return Planning that are translated into rules for conducting business. These rules align Return process policies with business strategy, goals, and objectives. The process of measuring actual Return Process performance against internal and/or external standards to develop and implement a course of action to achieve targeted performance levels. The process of collecting, integrating and maintaining the accuracy of return execution information necessary to plan the recovery of supply chain resources. The process of establishing a return process inventory strategy and planning the recovery process inventory limits or levels (including Raw Material, Work In Process, Finished and Purchased Finished Goods) including replenishment models, ownership, product mix, and stocking locations, both inter and intra company. The process of acquiring, maintaining and dispositioning capital assets such as fork lift trucks, information systems and equipment in receiving docks that are utilized in support of Return. Management activities would include dening asset requirements, determining resource availability and conducting gap analysis and resolution. The process includes lease-buy and outsourcing decisions. The process of providing the least cost transportation of a returned product from a customer location to the appropriate service provider location within specied time frames. Can include interim transportation activities conducted within more than one service provider locations. Includes dening and implementing a Return transportation strategy throughout the supply chain, maintaining transportationrelated information (rates, lead times) and managing transportation performance. The process where customer and service provider locations involved in the ow of returns are dened and maintained throughout the supply chain. Locations include retail and wholesale customer and supplier sites, manufacturing facilities, distribution centers, warehouses, repair depots and military bases.
ER.3: Manage Return Data Collection ER.4: Manage Return Inventory
ER.5: Manage Return Capital Assets
ER.6: Manage Return Transportation
3.5.49
ER
ER.8: Manage Return Regulatory Requirements and Compliance The process of identifying and complying with regulatory documentation and process standards set by external entities (i.e. government, trade ocials, etc.) when planning for the Return of Assets. Includes Customs requirements and Import / Export Controls. The process of managing Return risks within an overall Supply Chain Risk Program. This includes identifying and assessing Return risks as well as and planning and implementing responses to Return risks. Return risks include potential events that could impact you or the customers ability to Return goods in a timely manner at a reasonable cost with minimal damage. Risk Management includes: mitigation, either reducing the impact of a risk event or reducing the likelihood it will occur.
ER.9: Manage Supply Chain Return Risk
3.5.50
ER
Process Procedures P5.4 Return Rules and Policies P5.4
! ER.1 ! ! ER.2 ! ! ER.3 ! ! ER.4 ! ! ER.5 ! ! ER.6 ! ! ER.7 ! ! ER.8 ! ! ER.9 !
Business Rules for Return Processes P5.1, P5.2, ES.7, SR1.1, SR2.1, SR3.1, DR1.1, DR2.1, DR3.1, ER.4, ER.5, R.7, ER.8
MRO Product Return Capabilities ER.2, ER.5 Return Benchmark Data Process Procedures P5.4 Receipt Data ER.3, ER.4
Return Product History ER.3 Supply-Chain Performance Metrics EP.2, ED.1, ED.5 Return Performance ER.5, ER.6 MRO Product Return Capabilities ER.2, ER.5
Data Cleansing Procedure Data System Requirements Return Product History ER.2
Data About Return Capabilities P5.2 Receipt Data DR1.3, DR2.3, DR3.3, ER.2
Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Return Plans P5.4 Return Product Location SR1.2, SR2.2, SR3.2, ER.4 Business Rules for Return Processes ES.1, ER.1
Receipt Data DR1.3, DR2.3, DR3.3, ER.2 Return Inventory Availability SR1.3, SR1.4, SR1.5, SR2.3, SR2.4, SR2.5, SR3.3, SR3.4, SR3.5 Assess and Aggregate Return Resources Return Inventory for Transfer DR1.4, DR2.4, DR3.4 Return Product Location SR1.2, SR2.2, SR3.2, ER.4 Return Inventory Targets P5.4
Business Rules for Return Processes ES.1, ER.1 Return Performance ER.2 Return Plans P5.4
MRO Product Return Capabilities P5.2, ER.2
Return Performance ER.2 Return Plans P5.4
Return Transportation Guidelines, Policies, & Agreements DR1.3, DR2.3, DR3.3
Business Rules for Return Processes ES.1, ER.1 Return Plans P5.4
Return Network Conguration ER.8 Return Process Workow Denition and Policies P5.2
Business Rules for Return Processes ES.1, ER.1 Return Network Conguration ER.7 Process Procedures P5.4
Warranty Data SR1.1, SR2.1 Manage Regulatory Return Policy SR1.1, SR2.1, SR3.1 Return Regulatory Requirements P1.2, P5.1, P5.2, DR1.3, DR2.3, DR3.3
Risk Management Program for Process Area Internal Adjusments
3.5.51
ER.1
Manage Business Rules for Return Processes
The process of establishing, maintaining, and enforcing decision support criteria for Return Planning that are translated into rules for conducting business. These rules align Return process policies with business strategy, goals, and objectives. Examples of business rules include those that (1) Enable customers to identify when scheduled and unscheduled conditions occur that require a return authorization request, (2) Enable a service provider to conrm a part is authorized to be returned, (3) Identify the waiting period to conrm a return item has been shipped and received before following up (4) Develop and maintain customer and channel performance standards of return processes such as service levels, given service requirements by supply chain stakeholders/trading partners.(5) Communicate to customers the allowable amount of elapsed time from purchase and condition in which excess material must be received in order for it to be accepted as a return (6) Negotiate any restocking charge stipulations.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Standard Inventory Policy to Determine Excess Utilize Real-World Cases in Employee Training Publish Return Policy Electronic Reminders of Possible Scheduled Maintenance Evaluate the Benets of OutSourcing the Excess Material Return Process Metric None Identied Manage Business Rules for Return Processes Cycle Time None Identied Cost to Manage Business Rules for Return Processes None Identied Description/Denition None Identied None Identied Easy access to return business rules. Pull signals. Enables customer to focus on core competencies.
Inputs
Process Procedures P5.4 Return Rules and Policies P5.4
Outputs
> ER.1
>
Business Rules for Return Processes P5.1, P5.2, ES.7, SR1.1, SR2.1, SR3.1, DR1.1, DR2.1, DR3.1, ER.4, ER.5, ER.7, ER.8
3.5.52
ER.2
Manage Performance of Return Processes
The process of measuring actual Return Process performance against internal and/or external standards to develop and implement a course of action to achieve targeted performance levels.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Business Rules Are Clearly Communicated with the Customer Continuous Improvement is Planned through Process Reviews and Customer Feedback Metric None Identied Manage Performance of Return Processes Cycle Time None Identied Cost to Manage Performance of Return Processes None Identied Description/Denition Convenient availability to business rules and return criteria. Avenue to receive customer comments.
Outputs Inputs
MRO Product Return Capabilities ER.2, ER.5 Return Benchmark Data Process Procedures P5.4 Receipt Data ER.3, ER.4 Return Product History ER.3
> ER.2
> Return Performance

ER.5, ER.6
Supply-Chain Performance Metrics EP.2, ED.1, ED.5
MRO Product Return Capabilities ER.2, ER.5
3.5.53
ER.3
Manage Return Data Collection
The process of collecting, integrating and maintaining the accuracy of return execution information necessary to plan the recovery of supply chain resources.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Automated Update of Customer Excess Material Return Transaction History Data Accessibility across the Enterprise for Visibility by Discrete Business Units Metric None Identied Manage Return Data Collection Cycle Time None Identied Cost to Manage Return Data Collection None Identied Description/Denition Use trend analysis to inuence inventory level decisions. Web-based alerts to identify update occurred and when pre-determined thresholds are exceeded. Web based access to various levels of enterprise data
Inputs
Data Cleansing Procedure Data System Requirements Return Product History ER.2
Outputs
> ER.3
> Receipt Data
Data About Return Capabilities P5.2 DR1.3, DR2.3, DR3.3, ER.2
3.5.54
ER.4
Manage Return Inventory
The process of establishing a return process inventory strategy and planning the recovery process inventory limits or levels (including Raw Material, Work In Process, Finished and Purchased Finished Goods) including replenishment models, ownership, product mix, and stocking locations, both inter and intra company.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Unique Identier Tag for Each Repairable Asset Periodic Review of Metrics and Strategy with Comparisons to Industry Benchmarks Statistical Test Count Metric None Identied Manage Return Inventory Cycle Time None Identied Cost to Manage Return Inventory None Identied Description/Denition Asset management software using bar code, RFI tag, etc. Real time view of data.
The Statistical Test Count (STC) process is a method of validating inventory on-hand values by physically counting and reconciling a statistical sample of the entire inventory population. This sample is then extrapolated across the inventory population, which provides an indicative measure of entire inventory population. Furthermore, with extrapolation the net and gross percentage of error is determined. Dynamic calculation of safety stock based on actual sales.
Real Time Data on Current Status
Outputs Inputs
Return Inventory Transfer Data DR1.4, DR2.4, DR3.3, DR3.4 Return Plans P5.4 Return Product Location SR1.2, SR2.2, SR3.2, ER.4 Business Rules for Return Processes ES.1, ER.1 Receipt Data DR1.3, DR2.3, DR3.3, ER.2 Return Inventory Availability SR1.3, SR1.4, SR1.5, SR2.3, SR2.4, SR2.5, SR3.3, SR3.4, SR3.5
> ER.4
> Assess and Aggregate Return Resources

Return Inventory for Transfer DR1.4, DR2.4, DR3.4 Return Product Location SR1.2, SR2.2, SR3.2, ER.4 Return Inventory Targets P5.4
3.5.55
ER.5
Manage Return Capital Assets
The process of acquiring, maintaining and dispositioning capital assets such as fork lift trucks, information systems and equipment in receiving docks that are utilized in support of Return. Management activities would include dening asset requirements, determining resource availability and conducting gap analysis and resolution. The process includes lease-buy and outsourcing decisions.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Integrated Transportation Visibility Automated Disposition Instructions for Returns Based on Data Interchange with Strategic Providers Outsource If Not a Core Competency Automated Data Entry Metric None Identied Manage Return Capital Assets Cycle Time None Identied Cost to Manage Return Capital Assets None Identied Description/Denition Advanced shipping notices Real time shipping tracking Advanced planning and scheduling capability coupled with decision support logic. Use 4PL to manage and move. Scanning with RFID/Bar-codes systems
Inputs
Business Rules for Return Processes ES.1, ER.1 Return Performance ER.2 Return Plans P5.4
Outputs
> ER.5
> MRO Product Return Capabilities

P5.2, ER.2
3.5.56
ER.6
Manage Return Transportation
The process of providing the least cost transportation of a returned product from a customer location to the appropriate service provider location within specied time frames. Can include interim transportation activities conducted within more than one service provider locations. Includes dening and implementing a Return transportation strategy throughout the supply chain, maintaining transportation-related information (rates, lead times) and managing transportation performance.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Develop Proactive Transit Damage Programs Integrated Order Management, Warehouse Management, and Transportation Management Systems View for analysis for all orders and shipments the following data: Logistics, Product, Cost, GL Charging Automated Documentation for International Shipments Segregate In-Bound Carcass Return Cost from Other Transportation Costs Involve Your Other Supply-Chain Partners If Possible to Leverage Transportation throughout the Chain Electronic Manifest and Electronic Billing Backhaul Trading Exchange Utilize Invoice-less Freight Payment Capture and Maintain Mode Specic Data Metric None Identied Manage Return Transportation Cycle Time None Identied Cost to Manage Return Transportation None Identied Description/Denition None Identied Transportation Management System (TMS) Maintenance Management
Transportation Management System (TMS) Maintenance Management None Identied
Utilization of transportation management system (TMS) to manage returns. Maximization of TMS use, both intra and inter-company within the supply chain. Transportation Management System (TMS) Maintenance Management Pooling None Identied Transportation Management System (TMS) Maintenance Management
3.5.57
ER.6
Best Practices cont. Limit the Number of Carriers, Treat Them as Partners and Build a Strong Relationship with Each One Geared Toward Continually Improving Service and Lowering Cost Consolidate Shipments Through Cross Docking - Coordinate with Other Shipments Rating & Routing Utilize Internet-Based Freight Bidding Built Around Shared Shipping Volume Projections Measurement of Carrier Performance for On-time Delivery and Completeness Appointment Scheduling for Pickup and Delivery of Customer Shipments Real-Time Shipment Tracking, (via internet) Manage Information Across 100% of Shipments Real-Time Optimized Shipment Method Selection (Air Parcel, Ground Parcel, LTL, etc.) Based on Customer Service Requirements Description/Denition cont. Utilization of transportation management system (TMS) to manage returns. Maximization of TMS use, both intra and inter-company within the supply chain.
None Identied
Internet Pooling (Electronic brokerage of shipments None Identied
Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management Transportation Management System (TMS) Maintenance Management
Inputs
Return Performance ER.2 Return Plans P5.4
Outputs
> ER.6
>
Return Transportation Guidelines, Policies, & Agreements DR1.3, DR2.3, DR3.3
3.5.58
ER.7
Manage Return Network Conguration
The process where customer and service provider locations involved in the ow of returns are dened and maintained throughout the supply chain. Locations include retail and wholesale customer and supplier sites, manufacturing facilities, distribution centers, warehouses, repair depots and military bases. How unserviceable material ow throughout the network is governed by the specic supply chains business rules. (See ER1)
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Service Provider Utilizes Web-Based Communicate to Identify New and Discontinued Repair Sites to Customers Utilize Web-Based Collaboration between Asset Manager and Repair Sites Regarding Capacity and Scheduling Utilize Web-Based Collaboration to Identify Potential New Repair Sites Prior to Their Selection Utilize Web-Based Collaboration between Customer and Service Provider on In-Bound Return Forecasts and Asset Tracking Metric None Identied Manage Return Network Conguration Cycle Time None Identied Cost to Manage Return Network Conguration None Identied Description/Denition Continuously updated authorized repair sites
Total return asset visibility throughout the network
Shared knowledge of resource availability and bottlenecks
Shared return forecasts
Inputs
Business Rules for Return Processes ES.1, ER.1 Return Plans P5.4
Outputs
> ER.7
>
Return Network Conguration ER.8 Return Process Workow Denition and Policies P5.2
3.5.59
ER.8
Manage Return Regulatory Requirements and Compliance
The process of identifying and complying with regulatory documentation and process standards set by external entities (i.e. government, trade ocials, etc.) when planning for the Return of Assets. Includes Customs requirements and Import / Export Controls.
Performance Attributes Supply Chain Reliability Supply Chain Responsiveness Supply Chain Agility Supply Chain Costs Supply Chain Asset Management Best Practices Conrm All Documentation and Inspection Requirements Before Shipping Compare Local Customs Requirements to Your Process Procedures to Ensure All Requirements Are Accounted for Before Shipping Clarify in Advance If the Product to be Returned Requires Specic, Formal Authorization from the Service Provider per Federal, State or Local Regulation, Prior to Returning Note and Communicate Shelf Life Requirements Carefully Before Shipping Clarify in Advance Hazardous Material Packaging, Labeling and Shipping Requirements Metric None Identied Manage Return Regulatory Requirements and Compliance Cycle Time None Identied Cost to Manage Return Regulatory Requirements and Compliance None Identied Description/Denition None Identied
None Identied
Participants at all customer and service provider locations involved clearly understand all regulatory requirements at each step in the return process .
Hazardous material regulations are given specic attention.
Overseas packaging, labeling and shipping regulatory requirements are given specic attention.
3.5.60
ER.8
Outputs Inputs
Business Rules for Return Processes ES.1, ER.1 Return Network Conguration ER.7 Process Procedures P5.4 Warranty Data SR1.1, SR2.1 Manage Regulatory Return Policy SR1.1, SR2.1, SR3.1 Return Regulatory Requirements P1.2, P5.1, P5.2, DR1.3, DR2.3, DR3.3
> ER.8
>
3.5.61
ER.9
Manage Supply Chain Return Risk
The process of managing Return risks within an overall Supply Chain Risk Program. This includes identifying and assessing Return risks as well as and planning and implementing responses to Return risks. Return risks include potential events that could impact you or the customers ability to Return goods in a timely manner at a reasonable cost with minimal damage. Risk Management includes: mitigation, either reducing the impact of a risk event or reducing the likelihood it will occur.
Performance Attributes Supply Chain Reliability Metric Age of Supplier Risk Data (months), VAR of product/customer performance - , Age of Product / Customer Risk Data (months), VAR of Internal Process Performance, Supplier Mitigation Plans Implemented (percent), VAR of Supplier Performance, Value at Risk (Return) External Event Response (average days) Internal Event Response (average days), Industry Benchmark Comparison (%), Options Rating (0-100%), Hedge Rating (Inventory DOS for risk management) Mitigation cost by Event ($), Assessment / Risk Management Costs ($), Mitigation Cost ($) Residual Risk ($), Mitigated Risk ($), Individual Process Area Event Rating (EVAR) ($), Supply / Customer / Product Base Rated (%), Gross Risk ($), Event Risk (EVAR) ($) Description/Denition A key aspect of supply chain risk management is identication. Identication involves creating a list of potential events that could harm any aspect of the supply chains performance. Risk identication allows an organization to take steps to create plans to manage risks before they occur. this is typically more cost eective then waiting to react to adverse events when they occur.
Supply Chain Costs
Best Practices Supply Chain Risk Identication
3.5.62
ER.9
Best Practices cont. Supply Chain Business Rules Congured to mitigate risk Description/Denition cont. This practice involves establishing business rules (e.g., customer priority, supplier priority, production routing, transportation routing, etc.) based on minimizing the risk to the supply chain. Under this practice, business rules are established or congured in response to the corporate risk management plan with a goal of reducing either the likelihood of a disruption occurring or the impact to the supply chain should a disruption occur. Business rule reconguration typically includes an assessment of the impact of each rule change on the overall supply chain before actual implementation. Supply Chain Information Congured to Minimize Risk This practice involves managing supply chain information networks to minimize the risk to the supply chain. This includes information sharing with partners as well as internal locations. This helps all parties to be quickly informed of a real or potential disruption and respond quickly and appropriately to minimize the disruption impact. Supply chain risk management is the systematic identication, assessment and mitigation of potential disruptions in logistics networks with the objective to reduce their negative impact on the logistics networks performance. Once areas of risk have been identied, an organization needs to monitor their internal and external environment. This helps them to predict when risky events are becoming more likely. It also helps to identify new risks and is tightly linked to the best practice of Supply Chain Risk Identication. The process of coordinated risk management places a strong emphasis on cooperation among departments within a single company and among dierent companies of a supply chain to eectively manage the full range of risks as a whole. A closer coordination of risk management activities performed throughout the supply chain is intended to conserve resources and increase eectiveness.
3.5.63
ER.9
Best Practices cont. Supply Chain Network Congured to Mitigate Risk Description/Denition cont. This practice relies on a risk evaluation of the supply chain to guide the design of the supply chain network. Node locations, transportation routes, capacity size and location, number of suppliers, number of production locations, etc. are all determined in a fashion that mitigates potential disruptions to the ability to deliver product and service to the end customer. This practice relies on the information collected through risk identication and risk assessment processes to identify nodes that are at a high risk of disruption due to the location of the node. Location specic risks can include tactical strike risks, natural disaster risks, single point of failure risks, etc. Supply Chain Risk Assessment Supply Chain Risk assessment provides management with an understanding of where the greatest risks may exist in order to prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of the risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events. the team can then prioritize addressing the risks. Open communication is necessary for eective risk management, where the term open refers to the possibility to directly reach the right person who can better handle the information about a crisis situations wherever in the organization. Managers require direct communication channels up, down and across their business units to help identify risks and take appropriate actions.
Inputs
Outputs
> ER.9

Internal Adjusments
3.5.64
Inputs/Outputs
Input/Output
Actual Sales History
Denition
Amount of past sales spanning any specied period of time (weeks, months, years, etc.) and expressed in any specied increments (per day, week, month, year, etc.)
Process
D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order D3.3: Enter Order, Commit Resources Launch Program P5.1: Assess and Aggregate Return Requirements P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Actual Shrink
Reductions of actual quantities of items in stock, in process, or in transit. The loss may be caused by scrap, theft, deterioration, evaporation, etc. An EDI notication of shipment of product.
Advanced Ship Notice
D2.11: Load Product & Generate Shipping Documentation 2.13: Receive and Verify Product by Customer ED.6: Manage Transportation D3.2: Negotiate and Receive Contract D3.3: Enter Order, Commit Resources Launch Program
Air, Ground, Carrier Rate Tables Approved Contract
Rates charged by common carriers to move goods, or freight. Acceptance of an agreement between two or more competent persons or companies to perform or not to perform specic acts or services or to deliver merchandise. A contract may be oral or written. The master record for an item. Typically, it contains identifying and descriptive data and control values (lead times, lot sizes, etc.) and may contain data on inventory status, requirements, planned orders, and costs. Item records are linked by bill of material records (or product structure records), thus dening the bill of material.
Approved Item Master
Assess and Aggregate Return Resources Assorted by Shelf Order The function of physically separating a homogeneous subgroup from a heterogeneous population of items Permission to return to service an item that has been repaired and found to be within specications and operable.
ER.4: Manage Return Inventory D4.3: Pick Product from Backroom
Authorization to Return to Service
SR3.2: Disposition Excess Product SR2.2: Disposition MRO Product D1.8: Receive Product from Source or Make SR1.2: Disposition Defective Product SR2.2: Disposition MRO Product SR3.2: Disposition Excess Product SR1.2: Disposition Defective Product D1.8: Receive Product from Source or Make
Authorization to Scrap
Permission to scrap material or item outside of specications and possessing characteristics that make rework impractical.
3.6.1
Inputs/Outputs
Input/Output
Available to Promise Date
Denition
The uncommitted portion of a companys inventory and planned production maintained in the master schedule to support customer-order promising. The ATP quantity is the uncommitted inventory balance in the rst period and is normally calculated for each period in which an MPS receipt is scheduled. In the rst period, ATP includes on-hand inventory less customer orders that are due and overdue A set of measurements (or metrics) that is used to establish goals for improvements in processes, functions, products, and so on Benchmark measures are often derived from other rms that display best in class achievement The Bill of Materials is a structured list of all the materials or parts needed to produce a particular nished product, assembly, subassembly, manufactured part, whether purchased or not. The process of accepting and translating what a customer wants into terms used by the manufacturer or distributor. The commitment should be based on the available-to-promise line (ATP) in the master schedule. This can be as simple as creating shipping documents for nished goods in a make-to-stock environment, or it might be a more complicated series of activities, including design eorts for make-to-order products A plan that includes an estimate of future costs and revenues related to expected activities. The budget serves as pattern for and a control over future operations. A plan that includes an estimate of future costs and revenues related to expected activities. The budget serves as a pattern for and a control over future operations.
Process
D2.3: Reserve Inventory and Determine Delivery Date
Benchmark Data
Bill of Materials
P2.1: Identify, Prioritize and Aggregate Product Requirements P3.1: Identify, Prioritize and Aggregate Production Requirements EP.7: Manage Planning Conguration ED.3: Manage Deliver Information D2.3: Reserve Inventory and Determine Delivery Date D2.2: Receive, Congure, Enter and Validate Order
Booked Order
Budget Constraints
EP.10: Align Supply Chain Unit Plan with Financial Plan P5.2: Identify, Assess, and Aggregate Return Resources EM.5: Manage Make Equipment and Facilities ED.7: Manage Product Life Cycle ED.5: Manage Deliver Capital Assets
Budgets
3.6.2
Inputs/Outputs
Input/Output
Business Plan
Denition
A document resulting from a process of linking the long-range strategy with projections of revenue, activity, cost and prot. This process develops objectives usually accompanied by budgets, projected balance sheet, and a cash ow statement. Rules for conducting business, i.e. developing and maintaining customer and channel performance standards of an return processes such as service levels, given service requirements by supply chain stakeholders/trading partners. Business rules align Return process policies with business strategy, goals, and objectives.
Process
EP.10: Align Supply Chain Unit Plan with Financial Plan EM.1: Manage Production Rules EP.1: Manage Business Rules for Plan Processes EM.2: Manage Production Performance ER.1: Manage Business Rules for Return Processes P5.2: Identify, Assess, and Aggregate Return Resources ER.4: Manage Return Inventory SR3.1: Identify Excess Product Condition ER.7: Manage Return Network Conguration DR1.1: Authorize Defective Product Return SR2.1: Identify MRO Product Condition ES.7: Manage Supplier Network ES.1: Manage Sourcing Business Rules ER.8: Manage Return Regulatory Requirements and Compliance SR1.1: Identify Defective Product Condition DR2.1: Authorize MRO Product Return P5.1: Assess and Aggregate Return Requirements DR3.1: Authorize Excess Product Return ER.5: Manage Return Capital Assets ES.1: Manage Sourcing Business Rules S3.2: Select Final Supplier (S) and Negotiate S3.1: Identify Sources of Supply ES.4: Manage Product Inventory
Business Rules for Return Processes
Business Rules for Source Processes
Rules that are translated into guidelines and policies for conducting business within the enterprise and other legal entities. Sourcing business rules include: supplier selection and negotiation processes, fulllment and delivery performance and relationship denition for specic levels of collaboration and partnership. A capacity constraint is said to exist when the available capacity at a resource may be insucient to meet the workload necessary to support the desired throughput. A capacity constraint is often a bottleneck.
Capacity Constraints
EP.4: Manage Integrated Supply Chain Inventory EP.6: Manage Integrated Supply Chain Transportation EP.5: Manage Integrated Supply Chain Capital Assets
3.6.3
Inputs/Outputs
Input/Output
Capacity Requirements
Denition
The resources needed to produce the projected level of work required from a facility over a time horizon. Capacity requirements are usually expressed in terms of hours of work or, when units consume similar resources at the same rate, units of production. Physical objects that are held by an organization for its production potential and that costs more than some threshold value (APICS) Contracts that customers have with specic freight carriers through which suppliers have to work for the delivery of products. Customer manages carrier selection, shipment of purchased product, and payment of carrier. A document submitted in response to the a request for proposal from a customer with all the terms and conditions of sale of a product or service The rules for the management of product conguration, which includes the management of critical sub processes needed to manage the life cycle of individual item numbers including item masters, routings, rationalization, and bill of materials. Courses of action and processes that are established to meet the requirements placed on production by external entities. An armative indication or judgment that a product or service has met criteria translated into rules for meeting external regulatory requirements Indication of product and service quality, i.e. customer satisfaction. The process of analyzing orders to determine the groupings that result in least cost/best service fulllment and transportation.
Process
EM.6: Manage Transportation (WIP) EM.4: Manage In-Process Products (WIP)
Capital Assets
ES.5: Manage Capital Assets ES.8: Manage Import/Export Requirements (Source) ED.2: Assess Delivery Performance
Carrier Contracts (Customer)
Completed Proposal
D3.1: Obtain and Respond to RFP/RFQ D3.2: Negotiate and Receive Contract
Conguration Rules
D2.2: Receive, Congure, Enter and Validate Order ED.1: Manage Deliver Business Rules ED.1: Manage Deliver Business Rules
Conformance Plan
Conformance Rules
Consistently High Adoption Rates Consolidated Orders
D4.7: Deliver and/or Install D2.4: Consolidate Orders D2.5: Build Loads
3.6.4
Inputs/Outputs
Input/Output
Continuous Improvement Process
Denition
A process that identies opportunities for performance improvement and facilitates their realization through the use of metrics, process development methodologies/approaches, project management principles, and reporting tools that support strategic and business plans. The rates charged by a carrier that does not serve the general public, but provides transportation for hire for one or a limited number of shippers under a specic contract. Customer prole, which include address data, credit and purchase histories, customer preferences including shipping, status, and delivery requirements, etc. All the provisions and agreements of a contract. A promise in a contract that binds one to a specic course of action. These promises maybe made by either the buyer of seller. Corporate objectives are the goals and mission of an organization.
Process
Contract Carrier Rates
D.6: Manage Transportation ES.6: Manage Incoming Product ES.8: Manage Import/Export Requirements (Source) D2.2: Receive, Congure, Enter and Validate Order ED.3: Manage Deliver Information D3.1: Obtain and Respond to RFP/RFQ D1.2: Receive, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order P5.1: Assess and Aggregate Return Requirements
Contract Status
Contract Terms Contractual Obligations
Corporate Objectives and Strategies
EM.2: Manage Production Performance EM.8: Manage Make Regulatory Environment EM.1: Manage Production Rules EM.7: Manage Production Network
Cost to Produce
The cost to produce and item during a given period of time.Includes: the amount of direct materials, direct labor, and allocated overhead. The options available on the return of a repairable item, credit for the cost of the item, repair of the repairable item, receipt of a serviceable item from stock.
Credit/ Exchange Options
SR3.4: Schedule Excess Product Shipment SR2.3: Request MRO Return Authorization SR2.4: Schedule MRO Shipment SR3.3: Request Excess Product Return Authorization SR1.4: Schedule Defective Product Shipment SR1.3: Request Defective Product Return Authorization
3.6.5
Inputs/Outputs
Input/Output
Credit History
Denition
Report that portrays a potential customers payment history and debt, indicating the ability to pay in a timely manner in the future.
Process
D2.2: Receive, Congure, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order ED.3: Manage Deliver Information D3.1: Obtain and Respond to RFP/RFQ D1.2: Receive, Enter and Validate Order S3.2: Select Final Supplier (S) and Negotiate ES.3: Maintain Source Data ED.7: Manage Product Life Cycle ES.7: Manage Supplier Network S3.1: Identify Sources of Supply D3.1: Obtain and Respond to RFP/RFQ ED.3: Manage Deliver Information D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order D4.5: Fill Shopping Cart
Current Inventory Source Data
Data which will provide measurement of actual supplier performance against internal and or external standards to provide feedback to achieve and maintain the performance required to meet the customers needs. Customer prole, which include address data, credit and purchase histories, customer preferences including shipping, status, and delivery requirements, etc. Customer prole, which includes history, customer preferences, status, and delivery requirements, etc. General customer inquiries for information concerning products, availability, cost, and requests for quotes. Input to customer prole, frequency of visits, recurring, time frame, what purchased, numbers and rings. Measure of customer satisfaction with products and service. This database contains all information relative to customers as a group or singly and is updated when ever new information is received about a customer, includes customer proles. An order from a customer for a particular product or a number of products. It is often referred to as an actual demand to distinguish it from a forecasted demand.
Customer Address Data
Customer Data (preference) Customer Inquiry
D1.1: Process Inquiry and Quote D2.1: Process Inquiry and Quote
Customer Loyalty / Recurring Visits
D4.6: Checkout
Customer Master Database/Up to Date
ED.4: Manage Finished Goods Inventories ED.3: Manage Deliver Information
Customer Order
D3.3: Enter Order, Commit Resources Launch Program D3.4: Schedule Installation D3.2: Negotiate and Receive Contract D1.2: Receive, Enter and Validate Order D2.3: Reserve Inventory and Determine Delivery Date ED.2: Assess Delivery Performance ED.6: Manage Transportation D2.2: Receive, Congure, Enter and Validate Order D3.2: Negotiate and Receive Contract
Customer Order Size, Weight, and Freight Class
Coupled with cube and route, these criteria determine type of carrier and cost of shipment
3.6.6
Inputs/Outputs
Input/Output
Customer Prole/Data
Denition
Customer prole, which includes history, customer preferences, status, and delivery requirements, etc. A statement of price, terms of sale, and description of goods or services oered by a supplier to a prospective purchaser; a bid. When given in response to an inquiry, it is usually considered an oer to sell. Replenish Signal The part of the supply chain requirements related to the customers needs, including sales forecasts and actual orders and backorders Supply chain requirements related to the customers needs, including service requirements, sales forecasts and actual orders/backorders. Resources needed to meet Item stocking schedule requirement. Daily Shipment Volume categorized by customer, source, trac lane, carrier, etc. Information required in the process of integrating and maintaining the accuracy of return execution. The procedure that outlines the cleansing of return data to insure its validity and accuracy during the return process. List of requirements of the data system that insure cleansed data is compatible and usable, or the data system requirements to fully automate the return process. The amount of time that normally elapses between the time an order is received and the time the order is shipped. A standard allowance that is assumed on any given order for the movement of items from one operation to the next. The customer request for disposition instructions for a defective product from the appropriate source.
Process
D4.6: Checkout
Customer Quote
D1.1: Process Inquiry and Quote D1.2: Receive, Enter and Validate Order
Customer Replenish Signal Customer Requirements
D1.2: Receive, Enter and Validate Order P1.1: Identify, Prioritize and Aggregate SC Requirements
Customer Service Requirements
ED.2: Assess Delivery Performance ED.6: Manage Transportation
Daily Replenishment Requirements Daily Shipment Volume Data About Return Capabilities Data Cleansing Procedure
D4.1: Generate Stocking Schedule S1.4: Transfer Product D1.5: Build Loads D1.4: Consolidate Orders P5.2: Identify, Assess, and Aggregate Return Resources ER.3: Manage Return Data Collection ER.3: Manage Return Data Collection
Data System Requirements
ER.3: Manage Return Data Collection
DC/Vendor Lead Time
DC/Vendor Transit Time
P4.1: Identify, Prioritize and Aggregate Delivery Requirements DR1.1: Authorize Defective Product Return SR1.3: Request Defective Product Return Authorization
Defective Product Disposition Request
3.6.7
Inputs/Outputs
Input/Output
Defective Product Return Authorization Request
Denition
The customer request for disposition instructions for a defective product from the appropriate source. The approved or disapproved Return Product Authorization (RPA) for excess inventory, unserviceable products and/ or serviceable or obsolete products as dened by the terms and conditions of a customer/supplier contract. Maintenance, Repair and Overhaul spare parts used to support of operations and maintenance. Deliver Contract Terms Products that have been acknowledged as received by the customer.
Process
DR1.1: Authorize Defective Product Return SR1.3: Request Defective Product Return Authorization R1.3: Request Defective Product Return Authorization DR1.1: Authorize Defective Product Return
Defective Product Return Authorization Response
Defective Products
S1.2: Receive Product S2.2: Receive Product DR1.4: Transfer Defective Product D1.2: Receive, Enter and Validate Order 2.11: Load Product & Generate Shipping Documentation D1.11: Load Vehicle & Generate Shipping Docs P5.4: Establish and Communicate Return Plans P4.1: Identify, Prioritize and Aggregate Delivery Requirements P4.2: Identify, Assess and Aggregate Delivery Resources D2.4: Consolidate Orders D1.3: Reserve Inventory and Determine Delivery Date D1.4: Consolidate Orders D2.3: Reserve Inventory and Determine Delivery Date
Deliver Contract Terms Delivered End Items
Deliver Return Requirements
A determination or projection of the requirements the supply chain must meet in the handling and execution of returns. (i.e. quantity, mix, timing)
Delivery Date
Those stocks or items on hand used to support production (raw materials and work in process items), supporting activities (maintenance, repairs and operating supplies), and customer service (nished goods and spare parts). Determination of the time required from the receipt of the order until the item should be delivered. The process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs.
Delivery Performance
ED.2: Assess Delivery Performance ED.5: Manage Deliver Capital Assets ED.6: Manage Transportation ED.4: Manage Finished Goods Inventories
3.6.8
Inputs/Outputs
Input/Output
Delivery Plans
Denition
A plan for a course of action over specied time periods that involves a projected appropriation of supply resources to meet delivery requirements.
Process
D3.3: Enter Order, Commit Resources Launch Program P3.1: Identify, Prioritize and Aggregate Production Requirements D2.3: Reserve Inventory and Determine Delivery Date P5.2: Identify, Assess, and Aggregate Return Resources D1.3: Reserve Inventory and Determine Delivery Date P1.2: Identify, Prioritize and Aggregate SC Resources P4.4: Establish Delivery Plans M2.5: Stage Finished Product M3.6: Stage Finished Product P2.1: Identify, Prioritize and Aggregate Product Requirements P5.1: Assess and Aggregate Return Requirements M1.5: Stage Product P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements P4.1: Identify, Prioritize and Aggregate Delivery Requirements P4.2: Identify, Assess and Aggregate Delivery Resources P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements ED.8: Manage Import/Export Requirements M3.1: Finalize Production Engineering
Delivery Requirements
As a whole with constituent parts, all sources of demand in the delivery of a product or service. As a whole with constituent parts, all things that add value in the delivery of a product. Claims for the refund of duties as a result of a ruling by the a government agency. Final drawings, specications, formulas, part programs, etc.that describe requirements of a product. The design process consists of translating a set of functional requirements into an operational product, process, or service. Model of the distribution enterprise including the ows, processes, inputs, outputs, metrics, and best business practices. Economic Order Quantity - Result of a calculation that determines the most cost eective to quantity to order or produce. Economic Shipping Quantity - Result of a calculation that determines the most cost eective quantity to ship.
Delivery Resources and Capabilities
Duty Drawback Claims
Engineering Design
Enterprise Distribution Model
ED.7: Manage Product Life Cycle
EOQ/ESQs
3.6.9
Inputs/Outputs
Input/Output
Equipment and Facilities Characteristics Equipment and Facilities Maintenance History
Denition
Equipment and facility traits and specications required to meet external entities requirements. The process of documenting of the timing and maintenance of equipment and facilities including required repairs, alterations, calibration, servicing, replacement of parts and other miscellaneous items to maintain production capability of the manufacturing xed asset base Data gathered by measuring, examining, testing, or gauging one or more characteristics of equipment and facilities and comparing it to planned. Actions relating to the planning, nancing and disposition of capital outlays for such purposes as the purchase of new equipment, the introduction of new product lines, and the modernization of plant facilities Time-phased plans of present and future load (capacity required) on all resources (Equipment and Facilities) based on the planned and released supply authorizations (i.e., orders) and the planned capacity (capacity available) of these resources over a span of time. A proposal that may contain nal drawings, specications, formulas, part programs, etc.that describe requirements of a product A document used to solicit vendor responses when the functional requirements and features are known. A clear, complete and accurate statement or drawing of the technical requirements of a material, item or service, and of the procedure to determine if the requirements are met. Request disposition instructions for an excess item from the Supplier.
Process
EM.8: Manage Make Regulatory Environment EM.5: Manage Make Equipment and Facilities
Equipment and Facilities Monitoring Information
Equipment and Facilities Replacement and Disposition Plans
EM.5: Manage Make Equipment and Facilities EM.6: Manage Transportation (WIP) P3.2: Identify, Assess and Aggregate Production Resources M1.1: Schedule Production Activities M2.1: Schedule Production Activities EM.5: Manage Make Equipment and Facilities M3.2: Schedule Production Activities
Equipment and Facilities Schedules and Plans
ETO Proposal
S3.2: Select Final Supplier (S) and Negotiate
ETO Request for Proposal
ETO Spec or Design
Excess Product Disposition Request
SR3.3: Request Excess Product Return Authorization DR3.1: Authorize Excess Product Return
3.6.10
Inputs/Outputs
Input/Output
Excess Product Return Authorization Request
Denition
The process of a customer requesting authorization from a service provider, for the return of excess. In addition to discussing the excess, the customer and service provider would discuss enabling conditions such as return replacement or credit, packaging, handling, transportation and import / export requirements to facilitate the ecient return of excess to the service provider. The customer may need to go through several return authorization iterations with multiple service providers before authorization is received. The process of a customer obtaining authorization, from a service provider, for the return of excess product Material in excess of the current requirements. Available data that characterizes and quanties raw material, work in process, and nished goods inventories
Process
DR3.1: Authorize Excess Product Return SR3.3: Request Excess Product Return Authorization SR3.3: Request Excess Product Return Authorization
Excess Product Return Authorization Response Excess Products
DR3.1: Authorize Excess Product Return
S1.2: Receive Product S2.2: Receive Product DR3.4: Transfer Excess Product ED.4: Manage Finished Goods Inventories S1.4: Transfer Product D1.8: Receive Product from Source or Make S2.4: Transfer Product S3.6: Transfer Product ES.4: Manage Product Inventory EM.8: Manage Make Regulatory Environment ED.4: Manage Finished Goods Inventories S3.6: Transfer Product S1.4: Transfer Product S2.4: Transfer Product M3.7: Release Product to Deliver D3.9: Pick Product D4.2: Receive Product at the Store M2.6: Release Finished Product to Deliver M1.6: Release Product to Deliver D1.8: Receive Product from Source or Make D2.9: Pick Product ED.4: Manage Finished Goods Inventories P4.2: Identify, Assess and Aggregate Delivery Resources
Existing Inventory Data
External Regulatory Information Finished Goods Inventory Location
Documentation and process standards set by external entities (i.e. government, trade ocials, etc.) The physical storage location where Finished Product inventory is held in stock prior to use or shipment.
Finished Product Release
The authorization to ship a nished product that has been ordered.
Finish Goods Inventory Target Levels
In a min-max inventory system, the equivalent of the maximum. The target inventory is equal to the order point plus a variable order quantity.
3.6.11
Inputs/Outputs
Input/Output
Full Cart (Empty Cart)
Denition
Completion of customer checkout, sale of the selected goods, cart transitions from full to empty. Customer selected goods transferred to the point of sale. Determination of the best retail locations for implementation of full shelf equipment. Requirements established by a government which must be met before allowing the shipping, delivery of a product or manufacture of an item. Documents the implement law and requirements concerning the import and export of items and the manufacture of item. Indication of product and service quality. A judgmental forecasting technique based upon the a return history that is analogous to a present situation, such as the return history on a similar product, and using the past pattern to predict future returns.
Process
D4.6: Checkout
Full Cart Ready for Checkout Full Shelf Locations
D4.5: Fill Shopping Cart D4.6: Checkout D4.5: Fill Shopping Cart D4.4: Stock Shelf ED.8: Manage Import/Export Requirements ED.7: Manage Product Life Cycle ED.8: Manage Import/Export Requirements
Government Constraints
Government Regulations
High Customer Services Satisfaction Levels Historical Return Rates
D4.7: Deliver and/or Install DR3.1: Authorize Excess Product Return SR1.3: Request Defective Product Return Authorization SR3.3: Request Excess Product Return Authorization SR2.3: Request MRO Return Authorization DR2.1: Authorize MRO Product Return P5.1: Assess and Aggregate Return Requirements DR1.1: Authorize Defective Product Return ES.10: Manage Supplier Agreements ES.5: Manage Capital Assets ES.8: Manage Import/Export Requirements ES.6: Manage Incoming Product EM.4: Manage In-Process Products (WIP)
Import/Export Requirements
Requirements established by a government or trading areas (i.e EU, NAFTA etc) which must be met before allowing the shipping or delivery of a product across national boundaries. Data concerning product on order and due to be delivered to location agreed in the order.
Incoming Product Information
3.6.12
Inputs/Outputs
Input/Output
Information Feedback
Denition
The ow of information back into the control system so that actual performance can be compared with planned performance.
Process
M3.4: Produce and Test M3.7: Release Product to Deliver M3.6: Stage Finished Product M1.4: Package M2.4: Package M1.3: Produce and Test M3.5: Package M3.3: Issue Sourced/In-Process Product M1.5: Stage Product M2.2: Issue Sourced/In-Process Product M2.6: Release Finished Product to Deliver M3.2: Schedule Production Activities M2.3: Produce and Test M1.1: Schedule Production Activities M2.1: Schedule Production Activities M2.5: Stage Finished Product M1.2: Issue Material M1.6: Release Product to Deliver EM.3: Manage Make Information
Information from Business Processes
Data arranged or presented from a set of logically related tasks or activities performed to achieve a dened business outcome; so that the data yields an understanding not available from any single data element. A plan outlining the processes required for managing, collecting, maintaining, and communicating information and masterdata to support planning and execution processes. Interrelated computer hardware and software along with people and processes designed for the collection, processing, and dissemination of information for planning, decision making, and control. Specifying the inputs, les, processing, businesss rules and outputs for a new system, but without expressing computer alternatives and technical details. The process of preparing, testing and installing the product at the customer site. The standalone product is fully functional upon completion, but there may be requirment for subseqent integration.
Information Infrastructure Plan
Information Needed to Create and Maintain IT
Information Needs Analysis
Installed Product
D1.14: Install Product D2.15: Invoice D1.15: Invoice D3.14: Install Product D2.14: Install Product
3.6.13
Inputs/Outputs
Input/Output
Integrated Supply Chain Inventory Information Integrated Supply Chain Plan
Denition
Managing the ow of raw materials and products in a supply chain based on uncertain demand for the nished products. Communication of courses of action over the appropriate time-dened planning horizon and interval, representing a projected appropriation of supply chain resource and input material to meet supply-chain requirements as they aect the customer.
Process
EP.4: Manage Integrated Supply Chain Inventory EP.4: Manage Integrated Supply Chain Inventory ED.4: Manage Finished Goods Inventories
EM.9: Manage Supply Chain Make Risk ES.9: Manage Supply Chain Source Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk EP.9: Manage Supply Chain Plan Risk The organic capability of an organization to produce output per time period. EM.7: Manage Production Network
Internal Capacity
Internal Information
ES.9: Manage Supply Chain Source Risk EM.9: Manage Supply Chain Make Risk EP.9: Manage Supply Chain Plan Risk ED.9: Manage Supply Chain Deliver Risk ER.9: Manage Supply Chain Return Risk In business management, inventory consists of a list of goods and materials held available in stock. Also, those stocks or items used to support production (raw materials and workin-process items), supporting activities (maintenance, repair, and operating supplies), and customer service (nished goods and spare parts) P1.2: Identify, Prioritize and Aggregate SC Resources
Inventory
3.6.14
Inputs/Outputs
Input/Output
Inventory Availability
Denition
Those stocks or items on hand used to support production (raw materials and work in process items), supporting activities (maintenance, repairs and operating supplies), and customer service (nished goods and spare parts).
Process
M2.2: Issue Sourced/In-Process Product D2.9: Pick Product S1.4: Transfer Product S2.4: Transfer Product D1.8: Receive Product from Source or Make D4.3: Pick Product from Backroom D3.9: Pick Product D2.3: Reserve Inventory and Determine Delivery Date P2.2: Identify, Assess and Aggregate Product Resources M1.2: Issue Material M3.3: Issue Sourced/In-Process Product ES.4: Manage Product Inventory S3.6: Transfer Product M1.2: Issue Material M2.2: Issue Sourced/In-Process Product D4.2: Receive Product at the Store M3.3: Issue Sourced/In-Process Product D1.3: Reserve Inventory and Determine Delivery Date P3.2: Identify, Assess and Aggregate Production Resources D1.9: Pick Product D4.2: Receive Product at the Store D1.8: Receive Product from Source or Make P4.2: Identify, Assess and Aggregate Delivery Resources D1.3: Reserve Inventory and Determine Delivery Date D2.3: Reserve Inventory and Determine Delivery Date
Inventory Availability/ Delivery Date
Those stocks or items on hand used to support production (raw materials and work in process items), supporting activities (maintenance, repairs and operating supplies), and customer service (nished goods and spare parts). Determination of the time required from the receipt of the order until the item should be delivered. Maximum rate of output for the inventory managment and warehouse process Stored products or service parts ready for sale, as distinguished from stores, which are usually components or raw materials. The rules that determining the desired levels of items, whether raw materials, work in process, or nished products including order quantities and safety stock levels.
Inventory Capacity
EM.2: Manage Production Performance EM.1: Manage Production Rules D4.3: Pick Product from Backroom
Inventory in Stock
Inventory Rules
ED.4: Manage Finished Goods Inventories ED.4: Manage Finished Goods Inventories ED.5: Manage Deliver Capital Assets
3.6.15
Inputs/Outputs
Input/Output
Inventory Status
Denition
A periodic report showing the inventory on hand and usually showing the inventory on order and some sales or usage history for the products that are covered in the stock status report. The total supply chain inventory strategy. Contains the plan for total inventory limits or levels (including Raw Material, Work In Process, Finished and Purchased Finished Goods) including replenishment models, ownership, product mix, and stocking locations, both inter and intra company. A record of specic information for each product, which denes the system parameters with which to eectively plan and execute using ERP (MRP, etc) systems.
Process
Inventory Strategy
EP.4: Manage Integrated Supply Chain Inventory P1.3: Balance Supply Chain Resources with SC Requirements P5.2: Identify, Assess, and Aggregate Return Resources
Item Master
P2.1: Identify, Prioritize and Aggregate Product Requirements P4.1: Identify, Prioritize and Aggregate Delivery Requirements P5.1: Assess and Aggregate Return Requirements P3.1: Identify, Prioritize and Aggregate Production Requirements EP.7: Manage Planning Conguration D4.2: Receive Product at the Store D4.3: Pick Product from Backroom
Item Pick Sheet for Stocking Schedule
A document that lists the material to be picked to meet the schedule for the planned movement of material from a bulk storage area to an order pick storage area. The activities and techniques of determining the desired levels of items, whether raw materials, work in process, or nished products. Demand for inventory maybe dependant or independent. Inventory functions are anticipation, hedge, cycle (lot size), uctuation (safety, buer or reserve), transportation (pipeline), an service parts. The function that performs tasks for the outgoing shipment of parts, components, and products. It includes packaging, marking, weighing, and loading for shipment. Also, verify the shipment and customer credit information. Customer selected retail nished goods transferred to the point of sale.
Item Stocking Requirements
D4.2: Receive Product at the Store P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Load, Shipping, Verify, and Credit Information
SR2.5: Return MRO Product SR1.5: Return Defective Product SR3.5: Return Excess Product D1.11: Load Vehicle & Generate Shipping Docs
Loaded Retail Cart or Pallet
D4.3: Pick Product from Backroom S1.4: Transfer Product D4.4: Stock Shelf
3.6.16
Inputs/Outputs
Input/Output
Load Information
Denition
Information relative to a load that is built and shipped, i.e. customer, items, destinations, weight, etc
Process
P4.2: Identify, Assess and Aggregate Delivery Resources D3.5: Build Loads D2.6: Route Shipments D2.5: Build Loads D1.6: Route Shipments D1.5: Build Loads D3.6: Route Shipments D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order ED.7: Manage Product Life Cycle D3.2: Negotiate and Receive Contract ES.6: Manage Incoming Product S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S1.1: Schedule Product Deliveries D4.5: Fill Shopping Cart
Location of Customers
Customer prole, which includes address and location data, credit and purchase histories, customer preferences including shipping, status, and delivery requirements, etc. Carrier selection and management for inbound or outbound shipments (linked to terms of delivery) On-line orders that are missing due to internet, software, or hardware malfunctions. Indication of quality in workmanship and design. More units, higher average ring, etc. The output of the process used to determine whether a demand will be supplied with internal capacity or purchased through contract manufacturing and/or contracted services externally. Managing the ow of raw materials and products in a supply chain based on uncertain demand for the nished products
Logistics Selection
Lost or Dropped Shopping Carts Low Rates of Failure Loyalty Customer Prole Changes Make/Buy Decision
D4.7: Deliver and/or Install D4.6: Checkout P5.2: Identify, Assess, and Aggregate Return Resources P1.2: Identify, Prioritize and Aggregate SC Resources EP.5: Manage Integrated Supply Chain Capital Assets DR3.1: Authorize Excess Product Return DR1.1: Authorize Defective Product Return DR2.1: Authorize MRO Product Return DR1.1: Authorize Defective Product Return DR3.1: Authorize Excess Product Return DR2.1: Authorize MRO Product Return ED.2: Assess Delivery Performance ED.1: Manage Deliver Business Rules
Manage Integrated Supply Chain Inventory Information
Management Process Reports
Reports which provide management with the process information required to evaluate prescribed activities to ensure that the stated objectives of a project, manufactured good, or service are achieved.
3.6.17
Inputs/Outputs
Input/Output
Manage Regulatory Return Policy
Denition
The process of identifying and complying with regulatory documentation and process standards set by external entities (i.e. government, trade ocials, etc.) when planning for the Return and Recovery of Assets. The scheduled activities, including adjustments, replacements, and basic cleanliness, that are recommended by the manufacturer to forestall machine breakdowns. Part of the Market Plan, which establishes an allowance or deduction, granted by the seller to the buyer, usually when the buyer meets certain stipulated conditions that reduce the price of the products purchased. For example, based upon paying early, buying in quantity, etc. The categorization of goods based upon the range of specications met during the manufacturing process. The merchandising plan includes the current market position, opportunity and issue analysis, merchandising objectives and strategies, action plans, programs, projects, budgets, and pro forma prot and loss statement and management controls. Methods, procedures and processes required to produce distinct items, such as parts that retain their identity through the transformation process and are intended to be completed after receipt of a customer order, including custom products that are designed, developed, and produced in response to a specic customer request.
Process
SR2.1: Identify MRO Product Condition SR1.1: Identify Defective Product Condition ER.8: Manage Return Regulatory Requirements and Compliance SR3.1: Identify Excess Product Condition EM.5: Manage Make Equipment and Facilities
Manufacturers Recommended Maintenance Schedules & Specications Markdown Plans
Merchandise Category/ Classication Merchandising Plan
P4.1: Identify, Prioritize and Aggregate Delivery Requirements D4.5: Fill Shopping Cart
Methods, Procedures, Processes
M3.2: Schedule Production Activities M3.1: Finalize Production Engineering
Monitoring
EM.9: Manage Supply Chain Make Risk ER.9: Manage Supply Chain Return Risk ES.9: Manage Supply Chain Source Risk ED.9: Manage Supply Chain Deliver Risk EP.9: Manage Supply Chain Plan Risk Request disposition instructions for an MRO item from the Supplier. DR2.1: Authorize MRO Product Return SR2.3: Request MRO Return Authorization
MRO Disposition Request
3.6.18
Inputs/Outputs
Input/Output
MRO Parts Availability
Denition
The on-hand MRO inventory balance minus allocations, reservations, backorders, and (usually) quantities held for quality problems. See Product Return Capagilities
Process
EM.5: Manage Make Equipment and Facilities ES.4: Manage Product Inventory P5.2: Identify, Assess, and Aggregate Return Resources ER.2: Manage Performance of Return Processes ER.5: Manage Return Capital Assets ER.2: Manage Performance of Return Processes S1.2: Receive Product S2.2: Receive Product DR2.4: Transfer MRO Product SR2.3: Request MRO Return Authorization DR2.1: Authorize MRO Product Return
MRO Product Return Capabilities
MRO Products
Maintenance, Repair and Overhaul spare parts used to support of operations and maintenance. The process of a customer requesting authorization from a service provider, for the return of an MRO product. In addition to discussing the MRO issue, the customer and service provider would discuss enabling conditions such as return replacement or credit, packaging, handling, transportation and import / export requirements to facilitate the ecient return of the MRO product to the service provider. The customer may need to go through several return authorization iterations with multiple service providers before authorization is received. The process of a customer obtaining authorization, from a service provider, for the return of an MRO product Requirements for the triggering of material movement to a work center only when that work center is ready to begin the next job. An unlled customer order or commitment. A backorder is an immediate (or past due) demand against an item whose inventory is insucient to satisfy the demand. Payment at the time of order, maybe partial or in full.
MRO Return Authorization Request
MRO Return Authorization Response On-demand Replenishment Requirements On-Order/Backorder
DR2.1: Authorize MRO Product Return SR2.3: Request MRO Return Authorization D4.1: Generate Stocking Schedule
D4.3: Pick Product from Backroom
Optional Payment
D3.2: Negotiate and Receive Contract D1.2: Receive, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order
3.6.19
Inputs/Outputs
Input/Output
Order Backlog
Denition
Orders that have been received and entered into the order processing system and are in a queue waiting to be processed and shipped.
Process
P4.1: Identify, Prioritize and Aggregate Delivery Requirements D2.3: Reserve Inventory and Determine Delivery Date P1.1: Identify, Prioritize and Aggregate SC Requirements D1.11: Load Vehicle & Generate Shipping Docs D1.3: Reserve Inventory and Determine Delivery Date D3.3: Enter Order, Commit Resources Launch Program D3.3: Enter Order, Commit Resources Launch Program M3.1: Finalize Production Engineering D2.1: Process Inquiry and Quote D2.2: Receive, Congure, Enter and Validate Order
Order Information
The function encompasses receiving and entering all data necessary on orders, so the order can be nalized and entered into the order system. A statement of price, terms of sale, and description of goods or services oered by a supplier to a prospective purchaser; a bid. When given in response to an inquiry, it is usually considered an oer to sell. Rules for the function that encompasses receiving, entering, and promising orders from customers, distribution centers, and interplant operations.
Order Quote (CUSTOMER)
Order Rules
ED.4: Manage Finished Goods Inventories D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order D3.2: Negotiate and Receive Contract ED.1: Manage Deliver Business Rules ED.5: Manage Deliver Capital Assets D2.3: Reserve Inventory and Determine Delivery Date P2.1: Identify, Prioritize and Aggregate Product Requirements P3.1: Identify, Prioritize and Aggregate Production Requirements D3.3: Enter Order, Commit Resources Launch Program P1.2: Identify, Prioritize and Aggregate SC Resources EP.5: Manage Integrated Supply Chain Capital Assets EP.6: Manage Integrated Supply Chain Transportation P5.2: Identify, Assess, and Aggregate Return Resources
Order Signal
Reserved inventory and/or planned capacity and delivery date for a specic order.
Outsource Plan
A plan that describes how a company will utilize third party business partners to provide products and services which the company chooses not to provide with internal capacity. Outsource Plans can vary in detail from simple policy statements to highly detailed plans with specics about the third party business partners, specications for products and services, performance expectations, and contract considerations.
3.6.20
Inputs/Outputs
Input/Output
Parts and Services Consumed
Denition
The items and services utilized to manufacture a product.
Process
ES.4: Manage Product Inventory EM.5: Manage Make Equipment and Facilities ES.8: Manage Import/Export Requirements ES.5: Manage Capital Assets D3.15: Invoice D2.15: Invoice D1.15: Invoice S3.7: Authorize Supplier Payment S1.5: Authorize Supplier Payment S2.5: Authorize Supplier Payment ES.10: Manage Supplier Agreements D1.5: Build Loads SR3.4: Schedule Excess Product Shipment SR1.4: Schedule Defective Product Shipment SR2.4: Schedule MRO Shipment P2.2: Identify, Assess and Aggregate Product Resources P1.1: Identify, Prioritize and Aggregate SC Requirements EM.7: Manage Production Network EP.3: Manage Plan Data Collection P5.2: Identify, Assess, and Aggregate Return Resources P4.1: Identify, Prioritize and Aggregate Delivery Requirements P3.2: Identify, Assess and Aggregate Production Resources P3.1: Identify, Prioritize and Aggregate Production Requirements P1.2: Identify, Prioritize and Aggregate SC Resources P5.1: Assess and Aggregate Return Requirements P2.1: Identify, Prioritize and Aggregate Product Requirements P4.2: Identify, Assess and Aggregate Delivery Resources
Payment
Receipt of payment for goods and services per contract or purchase order. The process of authorizing payments and paying suppliers for product or services. This process includes invoice collection, invoice matching and the issuance of checks. Transportation modes are selected and ecient loads are built.
Payment Terms
Plan and Build Loads Information
Planning Data
Execution information necessary to plan the balance of supply chain resources to demand requirements at both the highest aggregate and lowest SKU planning levels.
3.6.21
Inputs/Outputs
Input/Output
Planning Decision Policies
Denition
Any company policies that aect how a planning process is dened, approved, and performed.
Process
P1.3: Balance Supply Chain Resources with SC Requirements ED.1: Manage Deliver Business Rules EP.5: Manage Integrated Supply Chain Capital Assets EP.1: Manage Business Rules for Plan Processes P3.3: Balance Production Resources with Production Requirements P5.3: Balance Return Resources with Return Requirements EP.4: Manage Integrated Supply Chain Inventory P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements P2.3: Balance Product Resources with Product Requirements EP.6: Manage Integrated Supply Chain Transportation D4.4: Stock Shelf
Plan-o-gram Data
Data required to develop and build a Plan-O-Gram display to help minimize setup time by showing specic placement of all items, by product number, on the display. The relief of inventory and computation of sales data at the time and place of the sales, generally (may be manual) through the use of bar-coding, or magnetic media and equipment. Planned and scheduled activities, including adjustments, replacements, and basic cleanliness, that forestall machine and facility breakdowns. Also, the established frequency to change and maintain parts, based on failure consequences, with frequency set per part or machine type. (Well cared for equipment and facilities will last longer and cause fewer problems.) A planned series of actions or operations that advances returns from one stage to another, or established procedures to manage and execute all activities in the process.
Point of Sale Data (Daily)
D4.6: Checkout P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Preventative Maintenance and Calibration Schedule
M2.1: Schedule Production Activities M3.2: Schedule Production Activities EM.5: Manage Make Equipment and Facilities M1.1: Schedule Production Activities
Process Procedures
ER.2: Manage Performance of Return Processes ER.1: Manage Business Rules for Return Processes P5.4: Establish and Communicate Return Plans ER.8: Manage Return Regulatory Requirements and Compliance
3.6.22
Inputs/Outputs
Input/Output
Procurement Signal (Supplier)
Denition
Any signal that indicates when to produce or transport Items in a pull replenishment system, or the signal that sends the estimated need of parts or services to the supplier. The end object of a transformation process that includes physical objects, information or services.
Process
S1.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S2.1: Schedule Product Deliveries S3.2: Select Final Supplier (S) and Negotiate S2.2: Receive Product 1.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D3.14: Install Product S1.2: Receive Product D3.13: Receive and Verify Product by Customer D1.14: Install Product D2.14: Install Product S3.4: Receive Product P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Product
Product/Category Lifecycle
The time from initial research and development to the time at which the sales and support of the product to customers are withdrawn. Availability of a product by location that is reserved, scheduled or available for sale, or the number of products ready to be or planned to be shipped to the specic customer or market at the specic time. The properties and characteristics of a product (e.g. the part number and a text description of the product) and the relationships to other items in the product family and linked / related SKUs. The product design is the translation of a set of functional requirements into an operational product that meets both the enterprise and customer expectations. The product design is the translation of a set of functional requirements into an operational product that meets both the enterprise and customer expectations. Claims are marketing information provided as to performance, etc. Claims from the users of the product indicate a need to change the product design
Product Availability
P2.2: Identify, Assess and Aggregate Product Resources
Product Data (linked/ related SKUs)
D4.5: Fill Shopping Cart
Product Design
Product Design/Claims
3.6.23
Inputs/Outputs
Input/Output
Product Design/Quality
Denition
A product design approach that uses quality measures to capture the extent to which the design meets the needs of the target market (customer attributes), as well as its actual performance, aesthetics, and cost. The physical storage location where product inventory is held in stock prior to use or shipment. The target for the total product inventory, including e.g. raw material, work in progress and nished goods. The highest, sustainable output rate which can be achieved with the current product specications, product mix, worker eort, plant, and equipment. A statement of the output of a production facility for a specied period, comparing planned to actual production. A master production plan used to allocate capacity among manufacturing resources and schedule nite manufacturing activities or executing the performance of a service.Production Plan includes production capability.
Process
Product Inventory Location
S1.4: Transfer Product ES.4: Manage Product Inventory S3.6: Transfer Product S2.4: Transfer Product ES.4: Manage Product Inventory P2.2: Identify, Assess and Aggregate Product Resources EP.5: Manage Integrated Supply Chain Capital Assets EM.1: Manage Production Rules EM.2: Manage Production Performance EM.4: Manage In-Process Products (WIP) EM.6: Manage Transportation (WIP)
Product Inventory Target Levels Production Capacity
Production Orders Planned & Actual Reports
Production Plans
P1.2: Identify, Prioritize and Aggregate SC Resources P3.4: Establish Production Plans P5.1: Assess and Aggregate Return Requirements P4.2: Identify, Assess and Aggregate Delivery Resources M1.1: Schedule Production Activities EM.2: Manage Production Performance P5.2: Identify, Assess, and Aggregate Return Resources D3.3: Enter Order, Commit Resources Launch Program M3.6: Stage Finished Product EM.5: Manage Make Equipment and Facilities M2.1: Schedule Production Activities M1.5: Stage Product P2.1: Identify, Prioritize and Aggregate Product Requirements EM.1: Manage Production Rules D1.3: Reserve Inventory and Determine Delivery Date M2.5: Stage Finished Product M3.2: Schedule Production Activities D2.3: Reserve Inventory and Determine Delivery Date
3.6.24
Inputs/Outputs
Input/Output
Production Quality & Policies Production Quality and Policies The operational techniques and planned and systematic activities used to fulll requirements for quality in the production process, or the quality of the production, as dened by the company. For example, a percentage of parts produced without a need for adjustment or repair. The production policy indicates standard rules on how the production quality should be secured. As a whole with constituent parts, all sources of demand in the creation of a product or service. As a whole with constituent parts, all things that add value in the creation of a product or performance of a service. The rules directing or regulating the movement of goods through the entire manufacturing and repair cycle (parameters of production) from the requisitioning of raw material to the delivery of the nished products.
Denition
Process
Production Requirements Production Resources
P3.3: Balance Production Resources with Production Requirements P3.3: Balance Production Resources with Production Requirements P3.2: Identify, Assess and Aggregate Production Resources EM.2: Manage Production Performance EM.1: Manage Production Rules
Production Rules
3.6.25
Inputs/Outputs
Input/Output
Production Schedule
Denition
A plan that authorizes the factory to manufacture or repair a certain quantity of a specic item.
Process
D1.8: Receive Product from Source or Make M2.2: Issue Sourced/In-Process Product M1.1: Schedule Production Activities D3.9: Pick Product M3.2: Schedule Production Activities M2.1: Schedule Production Activities P3.2: Identify, Assess and Aggregate Production Resources M2.2: Issue Sourced/In-Process Product D4.2: Receive Product at the Store S1.1: Schedule Product Deliveries D2.9: Pick Product S3.3: Schedule Product Deliveries D2.3: Reserve Inventory and Determine Delivery Date M3.3: Issue Sourced/In-Process Product D1.3: Reserve Inventory and Determine Delivery Date S2.1: Schedule Product Deliveries M1.2: Issue Material D3.3: Enter Order, Commit Resources Launch Program EM.7: Manage Production Network EM.5: Manage Make Equipment and Facilities
Production Status
Feedback on the production schedule allowing for corrective action to a production problem, or an indication of how far in the production process a specic part has progressed Attributes of the products storage location.
Product Location Information
EM.6: Manage Transportation (WIP) M1.2: Issue Material M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product ED.7: Manage Product Life Cycle ED.4: Manage Finished Goods Inventories
Product Mix and Plans
The proportion of individual products that make up the total production or sales volume and plan that authorizes the factory to manufacture a certain quantity of a specic item, or the portfolio of products the company has to cover the targeted customer need and the plans of how to manage that portfolio. Product on order with a selected source.
Product On Order
S2.1: Schedule Product Deliveries ES.10: Manage Supplier Agreements P2.2: Identify, Assess and Aggregate Product Resources S1.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S2.1: Schedule Product Deliveries
3.6.26
Inputs/Outputs
Input/Output
Product Requirements
Denition
As a whole with constituent parts, all sources of demand for a product or service in the supply chain. The capability of a system or resources to produce a quantity output in a particular time period; and, any element or factor that constrains the system or resources from achieving a higher level of performance in respect to its goal. The ability the supply chain has to return products in a valid and accurate way. Product routings represent the way products are made and are integrated with the Bill of Materials. Key elements of proper Routings include proper sequence of operations, work center identication, relevant tolerances, run times, lot size and setups. The equivalent concepts for services are the workow processes and rules.
Process
P2.1: Identify, Prioritize and Aggregate Product Requirements P2.3: Balance Product Resources with Product Requirements DR3.1: Authorize Excess Product Return P5.4: Establish and Communicate Return Plans DR1.1: Authorize Defective Product Return DR2.1: Authorize MRO Product Return
Product Return Capabilities
Product Routings
P3.1: Identify, Prioritize and Aggregate Production Requirements EP.7: Manage Planning Conguration EP.4: Manage Integrated Supply Chain Inventory EP.6: Manage Integrated Supply Chain Transportation P2.1: Identify, Prioritize and Aggregate Product Requirements P4.1: Identify, Prioritize and Aggregate Delivery Requirements P5.1: Assess and Aggregate Return Requirements EP.5: Manage Integrated Supply Chain Capital Assets P2.3: Balance Product Resources with Product Requirements P2.2: Identify, Assess and Aggregate Product Resources EM.6: Manage Transportation (WIP) ED.6: Manage Transportation EM.7: Manage Production Network
Product Sources
As a whole with constituent parts, all material and other resources used to add value in the supply chain for a product or services. The companys goal for the time to ship the product after the receipt of a customers order. The policy is sometimes stated as our quoted delivery time, or an estimate of the customer delivery requirements of a product or service, e.g. which kind of packaging, should the parts be shipped one by one or in bulks etc. An estimate of the amount of product or service a particular part of the business (internal capacity) or a third party business partner (external capacity) is capable of producing over a particular period of time when all factors that control the production processes are working optimally.
Projected Delivery Requirements
Projected Internal and External Capacity
EP.6: Manage Integrated Supply Chain Transportation EP.5: Manage Integrated Supply Chain Capital Assets P5.2: Identify, Assess, and Aggregate Return Resources
3.6.27
Inputs/Outputs
Input/Output
Promotion/Event Plans
Denition
Promotion activities - other than advertising, publicity, and personal selling - that stimulate, interest, trial or purchase by nal customers or others in the marketing channel. The plan for a promotional product oering and how it is communicated to the customer and includes public relations, advertising, sales promotions, and other tools to persuade customers to purchase the product oering Time phased promotion / event tasks where the product oering is communicated to the customer and includes public relations, advertising, sales promotions, and other tools to persuade customers to purchase the product oering during the year. The amount of purchased products for a certain time in history per specic intervals
Process
Promotional Plan
Promotion Event Calendar
D4.6: Checkout
Purchase History
D2.2: Receive, Congure, Enter and Validate Order D3.1: Obtain and Respond to RFP/RFQ D1.2: Receive, Enter and Validate Order ED.3: Manage Deliver Information ES.3: Maintain Source Data
Quality & Delivery Performance
The process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs. Or, the extent to which the supplier delivers according to quality specication (e.g. product quality, logistic quality) and to delivery specication (in time, correct packaging etc). Sometimes these two metrics are connected in one.
3.6.28
Inputs/Outputs
Input/Output
Denition
The process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs.Or, the extent to which the supplier delivers according to quality specication (e.g. product quality, logistic quality) and to delivery specication (in time, correct packaging etc). Sometimes these two metrics are connected in one. Contract rates and taris from carriers by commodity, lane, mode, etc. for shipments. A collection of related receipt data records organized in a specic manner.
Process
Rated Carrier Data
D2.6: Route Shipments D3.6: Route Shipments D1.6: Route Shipments ER.4: Manage Return Inventory DR1.3: Receive Defective Product DR2.3: Receive MRO Product DR3.3: Receive Excess Product ER.3: Manage Return Data Collection ER.2: Manage Performance of Return Processes DR1.3: Receive Defective Product DR3.3: Receive Excess Product DR2.3: Receive MRO Product ED.8: Manage Import/Export Requirements ES.2: Assess Supplier Performance S1.3: Verify Product S2.3: Verify Product S3.6: Transfer Product S2.2: Receive Product ES.1: Manage Sourcing Business Rules S1.4: Transfer Product ES.6: Manage Incoming Product S1.2: Receive Product S1.3: Verify Product S3.5: Verify Product S2.3: Verify Product S3.5: Verify Product ES.8: Manage Import/Export Requirements S3.4: Receive Product S2.4: Transfer Product EP.8: Manage Plan Regulatory Requirements and Compliance P5.2: Identify, Assess, and Aggregate Return Resources
Receipt Data
Receipt Discrepancy Notication Receipt Verication
Notication of a discrepancy relating to a receipt, including: damage, packaging, quantity, etc. Acknowledgement that the product received conforms to specied requirements and criteria.
Regulatory Requirements
Requirements dictated by process standards set by external entities (i.e. government, trade ocials, etc.).
3.6.29
Inputs/Outputs
Input/Output
Replenishment Quantities
Denition
In a xed-reorder quantity system of inventory control, the xed quantity that should be ordered each time the available stock (on-hand plus on-order) falls to or below the reorder point. Any signal that indicates when to produce or transport Items in a pull replenishment system.
Process
Replenishment Signal
M3.3: Issue Sourced/In-Process Product M1.2: Issue Material D2.3: Reserve Inventory and Determine Delivery Date D1.3: Reserve Inventory and Determine Delivery Date S3.3: Schedule Product Deliveries S3.6: Transfer Product S2.4: Transfer Product M2.2: Issue Sourced/In-Process Product S1.1: Schedule Product Deliveries D3.3: Enter Order, Commit Resources Launch Program S1.4: Transfer Product S2.1: Schedule Product Deliveries EM.3: Manage Make Information
Reports, Information, and Documents
Collecting data and organizing, arranging or presenting the data so that they yield an understanding not available from any single data element. The capability of a system or resource to produce a quantity of output in a particular time period, or the available resources at a point in time able to generate an output. Data relative to the return process utilized to compare the companys actual results to selected values identied as reference.
Resource Availability
D3.3: Enter Order, Commit Resources Launch Program D4.1: Generate Stocking Schedule P4.2: Identify, Assess and Aggregate Delivery Resources ER.2: Manage Performance of Return Processes
Return Benchmark Data
Return Defective Product Returned Defective Product Product being returned that is in a defective condition.
SR1.1: Identify Defective Product Condition SR1.4: Schedule Defective Product Shipment SR1.4: Schedule Defective Product Shipment SR1.3: Request Defective Product Return Authorization DR1.4: Transfer Defective Product SR1.2: Disposition Defective Product SR1.5: Return Defective Product SR1.5: Return Defective Product SR1.2: Disposition Defective Product SR1.3: Request Defective Product Return Authorization R1.3: Receive Defective Product
3.6.30
Inputs/Outputs
Input/Output
Returned Excess Product
Denition
Product being returned as dened by the terms and conditions of a customer/ supplier contract as available inventory and disposition excess not usable for sale.
Process
SR3.1: Identify Excess Product Condition DR3.3: Receive Excess Product DR3.4: Transfer Excess Product SR3.5: Return Excess Product SR3.2: Disposition Excess Product DR3.3: Receive Excess Product SR3.3: Request Excess Product Return Authorization SR3.4: Schedule Excess Product Shipment SR3.2: Disposition Excess Product SR3.4: Schedule Excess Product Shipment SR2.3: Request MRO Return Authorization DR2.3: Receive MRO Product SR2.2: Disposition MRO Product SR2.5: Return MRO Product SR2.3: Request MRO Return Authorization DR2.4: Transfer MRO Product SR2.2: Disposition MRO Product SR2.1: Identify MRO Product Condition SR2.4: Schedule MRO Shipment SR2.5: Return MRO Product EM.4: Manage In-Process Products (WIP)
Returned MRO Product
Product being returned for maintenance, repair, or overhaul.
Returned Product Information
Data concerning the return and disposition of defective products, excess inventory and/or serviceable or obsolete products, or MRO product. Inventory relative to return process available for use.
Return Inventory Availability
SR1.3: Request Defective Product Return Authorization SR2.5: Return MRO Product ER.4: Manage Return Inventory SR3.2: Disposition Excess Product SR1.5: Return Defective Product SR2.3: Request MRO Return Authorization SR3.5: Return Excess Product SR2.2: Disposition MRO Product SR1.4: Schedule Defective Product Shipment ER.4: Manage Return Inventory SR3.4: Schedule Excess Product Shipment SR2.4: Schedule MRO Shipment SR3.3: Request Excess Product Return Authorization SR1.2: Disposition Defective Product
3.6.31
Inputs/Outputs
Input/Output
Return Inventory for Transfer
Denition
Inventory relative to return process available for transfer to other destination. The goals and approach to the management of return inventories. The process of receipt and verication of the returned item against the return authorization and other documentation and prepares the item for transfer.
Process
DR2.4: Transfer MRO Product DR1.4: Transfer Defective Product ER.4: Manage Return Inventory DR3.4: Transfer Excess Product P5.2: Identify, Assess, and Aggregate Return Resources ER.4: Manage Return Inventory S3.3: Schedule Product Deliveries P5.2: Identify, Assess, and Aggregate Return Resources DR3.3: Receive Excess Product DR3.4: Transfer Excess Product ER.4: Manage Return Inventory DR2.4: Transfer MRO Product DR1.4: Transfer Defective Product S2.1: Schedule Product Deliveries S1.1: Schedule Product Deliveries ER.7: Manage Return Network Conguration ER.8: Manage Return Regulatory Requirements and Compliance ER.2: Manage Performance of Return Processes ER.5: Manage Return Capital Assets ER.6: Manage Return Transportation DR3.1: Authorize Excess Product Return ER.4: Manage Return Inventory SR2.2: Disposition MRO Product DR2.1: Authorize MRO Product Return ER.5: Manage Return Capital Assets SR1.2: Disposition Defective Product ER.6: Manage Return Transportation ER.7: Manage Return Network Conguration SR3.2: Disposition Excess Product DR1.1: Authorize Defective Product Return P5.4: Establish and Communicate Return Plans P5.2: Identify, Assess, and Aggregate Return Resources EP.2: Manage Performance of Supply Chain ER.7: Manage Return Network Conguration P5.2: Identify, Assess, and Aggregate Return Resources
Return Inventory Targets
Return Inventory Transfer Data
Return Network Conguration
The business rules that govern the ow of unserviceable material through the network, i.e. the network conguration. Performance measurement information for the Return Process (the actual value of measured for the criterion). Courses of action over specied time periods that represent the projected appropriation of required return resources and or assets to meet the return process requirements.
Return Performance
Return Plans
Return Process Capabilities
The capability of a system or resources to produce a quantity output in a particular time period Denition and maintenance of the information ow about the Returns supply chain network for a group of similar or complimentary items through out their life cycle
Return Process Workow Denition and Policies
3.6.32
Inputs/Outputs
Input/Output
Return Product Authorization Return Product History
Denition
Permission to accept an excess product return for the designated return center, after communicating with the customer. The return history of product including failure rates, failure causes, etc. As a whole with constituent parts, all sources of demand in the creation of a product or service.
Process
DR3.1: Authorize Excess Product Return DR3.2: Schedule Excess Return Receipt ER.3: Manage Return Data Collection ER.2: Manage Performance of Return Processes P3.1: Identify, Prioritize and Aggregate Production Requirements P5.4: Establish and Communicate Return Plans P3.1: Identify, Prioritize and Aggregate Production Requirements SR1.2: Disposition Defective Product ER.4: Manage Return Inventory SR3.2: Disposition Excess Product ER.4: Manage Return Inventory SR2.2: Disposition MRO Product DR2.3: Receive MRO Product P5.2: Identify, Assess, and Aggregate Return Resources DR3.3: Receive Excess Product P5.1: Assess and Aggregate Return Requirements ER.8: Manage Return Regulatory Requirements and Compliance P1.2: Identify, Prioritize and Aggregate SC Resources DR1.3: Receive Defective Product P5.1: Assess and Aggregate Return Requirements P5.3: Balance Return Resources with Return Requirements P5.3: Balance Return Resources with Return Requirements P5.2: Identify, Assess, and Aggregate Return Resources ER.1: Manage Business Rules for Return Processes P5.4: Establish and Communicate Return Plans
Return Production Requirements
Return Product Location
The physical location where the returned product inventory is held prior to disposition
Return Regulatory Requirements
Return requirements dictated by process standards set by external entities (i.e. government, trade ocials, etc.).
Return Requirements
As a whole with constituent parts, all sources of demand for the return of a product. All resources that add value to, execute, or constrain the processes for the return of a product. Rules and Policies for conducting business, i.e. developing and maintaining customer and channel performance standards of return processes such as service levels, given service requirements by supply chain stakeholders/trading partners. Rules and policies align the Return process with the organizations business strategy, goals and objectives.
Return Resources
Return Rules and Policies
3.6.33
Inputs/Outputs
Input/Output
Return Schedule Instructions
Denition
A list of operations and procedures for scheduling the return of product.
Process
DR2.3: Receive MRO Product DR1.2: Schedule Defective Return Receipt DR3.3: Receive Excess Product DR3.2: Schedule Excess Return Receipt SR2.3: Request MRO Return Authorization DR2.2: Schedule MRO Return Receipt DR1.3: Receive Defective Product SR1.3: Request Defective Product Return Authorization SR3.3: Request Excess Product Return Authorization ED.8: Manage Import/Export Requirements ED.4: Manage Finished Goods Inventories DR1.3: Receive Defective Product DR3.3: Receive Excess Product ER.6: Manage Return Transportation DR2.3: Receive MRO Product P5.2: Identify, Assess, and Aggregate Return Resources EP.10: Align Supply Chain Unit Plan with Financial Plan P1.1: Identify, Prioritize and Aggregate SC Requirements P5.1: Assess and Aggregate Return Requirements
Returns Data
The properties, characteristics and information relating to returns, including failure information, excess, obsolete, MRO, customer, etc. Guidelines, policies and agreements for the transportation activities around return process. Guidelines, policies and agreements for the transportation activities around return process. An update to the aggregate SupplyChain Forecasts of Demand by Product Family supporting the Market/Channel Plans. Corresponding Projections, supporting Make, Source, Deliver, Inventory and Response Time Plans through the Supply-Chain are produced from these Forecasts Together, they represent balanced Supply and Demand. An update to the expected cause and eect statements that are the base for the Revised Aggregate Forecast and Projections. These are reviewed periodically with actual results to verify the linkage of actual cause and eect.
Return Transportation Guidelines, Policies, & Agreements Return Transportation Guidelines, Policies, and Agreements Revised Aggregate Forecast and Projections
Revised Business Assumptions
P5.1: Assess and Aggregate Return Requirements P1.1: Identify, Prioritize and Aggregate SC Requirements EP.5: Manage Integrated Supply Chain Capital Assets ED.7: Manage Product Life Cycle EP.10: Align Supply Chain Unit Plan with Financial Plan
3.6.34
Inputs/Outputs
Input/Output
Revised Capital Plan
Denition
A revision to plan for capital expenditures necessitated by either changes in specic business plans or factors and assumptions aecting a business plan.
Process
EP.6: Manage Integrated Supply Chain Transportation EP.5: Manage Integrated Supply Chain Capital Assets P5.2: Identify, Assess, and Aggregate Return Resources P1.2: Identify, Prioritize and Aggregate SC Resources D3.1: Obtain and Respond to RFP/RFQ
RFQ/RFP
Request for Quote - A document used to solicit vendor responses when a product has been selected and price quotations are needed from several vendors. Request for Proposal - A document used to solicit vendor responses when the functional requirements and features are known but no specic product is in mind.
Risk Management Program for Process Area
ES.9: Manage Supply Chain Source Risk ED.9: Manage Supply Chain Deliver Risk EM.9: Manage Supply Chain Make Risk EP.9: Manage Supply Chain Plan Risk ER.9: Manage Supply Chain Return Risk Information used to select modes, transportation lanes, available carriers, etc. Listing or routes, carriers & rates. Customers who are satised with the product or service delivered by the suppliers, including the aspects such as time, quality, cost, etc. Planned or scheduled returning of material deemed defective for some certain time or times The required or agreed time or rate of delivery of goods or services purchased for a future period. Planned or scheduled returning of material deemed in excess of current requirements for some certain time or times. The process of evaluating the design and build schedules relative to customer requested installation date to determine installation schedule. Planned or scheduled act of installing something for some certain time or times. D3.6: Route Shipments D2.6: Route Shipments D1.6: Route Shipments D4.6: Checkout
Routing Guide
Satised Customer
Scheduled Defective Product Return Scheduled Deliveries
SR1.5: Return Defective Product SR1.4: Schedule Defective Product Shipment D3.5: Build Loads D1.7: Select Carriers and Rate Shipments D2.6: Route Shipments D1.9: Pick Product SR3.4: Schedule Excess Product Shipment SR3.5: Return Excess Product D3.5: Build Loads D3.4: Schedule Installation
Scheduled Excess Product Return
Scheduled Installation
Scheduled MRO Return
SR2.5: Return MRO Product SR2.4: Schedule MRO Shipment
3.6.35
Inputs/Outputs
Input/Output
Scheduled Receipts
Denition
Product due to arrive.
Process
S3.3: Schedule Product Deliveries D1.8: Receive Product from Source or Make M2.1: Schedule Production Activities M3.2: Schedule Production Activities M1.1: Schedule Production Activities D4.2: Receive Product at the Store S3.4: Receive Product S1.1: Schedule Product Deliveries S1.2: Receive Product S2.1: Schedule Product Deliveries ED.8: Manage Import/Export Requirements ED.4: Manage Finished Goods Inventories P4.1: Identify, Prioritize and Aggregate Delivery Requirements EP.1: Manage Business Rules for Plan Processes
Scrap Authorization
Permission to scrap material or item outside of specications and possessing characteristics that make rework impractical. Performance targets in service related measures (i.e. delivery performance, lead times, etc.) compared to the established service requirements. Service levels are established by balancing requirements against operational strategy. A set of minimum acceptable values that describe service requirements of a particular industry, channel, and/or customer segment. Legal documentation of the contents of a shipment (e.g. way bill, bill of lading, export papers, etc....). Routes for shipping by consolidating loads.
Service Levels
Service Requirements
EP.1: Manage Business Rules for Plan Processes
Shipment Documents
SR1.5: Return Defective Product SR3.5: Return Excess Product D2.7: Select Carriers and Rate Shipments D1.7: Select Carriers and Rate Shipments D1.6: Route Shipments D2.6: Route Shipments D1.3: Reserve Inventory and Determine Delivery Date P1.1: Identify, Prioritize and Aggregate SC Requirements D1.11: Load Vehicle & Generate Shipping Docs D2.11: Load Product & Generate Shipping Documentation SR2.5: Return MRO Product D3.11: Load Product & Generate Shipping Documents D1.11: Load Vehicle & Generate Shipping Docs
Shipment Routes
Shipments
Transactions related to sending the product to the customer.
Shipping Documents
Legal documentation of the contents of a shipment (e.g. way bill, bill of lading, export papers, etc....).
3.6.36
Inputs/Outputs
Input/Output
Shipping Export Parameters and Documentation
Denition
Shipping and documentation requirements established by a government which must be met before allowing the shipping or delivery of a product across national boundaries.
Process
D3.11: Load Product & Generate Shipping Documents D1.11: Load Vehicle & Generate Shipping Docs ED.8: Manage Import/Export Requirements D2.11: Load Product & Generate Shipping Documentation D2.11: Load Product & Generate Shipping Documentation D1.11: Load Vehicle & Generate Shipping Docs D3.11: Load Product & Generate Shipping Documents ED.8: Manage Import/Export Requirements D2.11: Load Product & Generate Shipping Documentation D1.11: Load Vehicle & Generate Shipping Docs ED.6: Manage Transportation D3.11: Load Product & Generate Shipping Documents D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order D3.1: Obtain and Respond to RFP/RFQ ED.3: Manage Deliver Information D4.1: Generate Stocking Schedule
Shipping History
The transaction history of the physical shipment of an item to another internal location or to a customer.
Shipping Parameters and Documentation
Shipping parameters, such as weight, size, cube and route decide carrier and cost. Legal documentation of the contents of a shipment (e.g. way bill, bill of lading, export papers, etc.) are required. Customer preferences including shipping, status, and delivery requirements, etc., and customer prole, which includes address data, credit and purchase histories, Scheduling of direct deliveries of material to a specied location on a plant oor near the operation where it is to be used. Data about the destination of a retun delivery.
Shipping Preferences (Customer)
Shipping Schedules (internal or 3PL)
Ship-to Data
SR1.3: Request Defective Product Return Authorization DR3.1: Authorize Excess Product Return SR1.4: Schedule Defective Product Shipment SR3.4: Schedule Excess Product Shipment SR2.3: Request MRO Return Authorization SR2.4: Schedule MRO Shipment DR1.1: Authorize Defective Product Return DR2.1: Authorize MRO Product Return SR3.3: Request Excess Product Return Authorization
3.6.37
Inputs/Outputs
Input/Output
Source Execution Data
Denition
Data which will provide measurement of actual supplier performance against internal and or external standards to provide feedback to achieve and maintain the performance required to meet the customers needs. All sources of demand in the Source Return of a product or service.
Process
S2.1: Schedule Product Deliveries M2.2: Issue Sourced/In-Process Product
Source Return Requirements
P5.4: Establish and Communicate Return Plans P2.1: Identify, Prioritize and Aggregate Product Requirements S3.1: Identify Sources of Supply D2.3: Reserve Inventory and Determine Delivery Date DR2.4: Transfer MRO Product ES.3: Maintain Source Data ES.4: Manage Product Inventory D1.3: Reserve Inventory and Determine Delivery Date S1.1: Schedule Product Deliveries P3.2: Identify, Assess and Aggregate Production Resources S2.1: Schedule Product Deliveries DR1.4: Transfer Defective Product P2.4: Establish Sourcing Plans DR3.4: Transfer Excess Product P4.2: Identify, Assess and Aggregate Delivery Resources P5.1: Assess and Aggregate Return Requirements S3.3: Schedule Product Deliveries D3.3: Enter Order, Commit Resources Launch Program P5.2: Identify, Assess, and Aggregate Return Resources P1.2: Identify, Prioritize and Aggregate SC Resources Function allocation diagram ED.6: Manage Transportation D4.1: Generate Stocking Schedule P4.4: Establish Delivery Plans
Sourcing Plans
An aggregate material requirements plan used to schedule material deliveries to meet production plan.
Standard Practices/Rules Stocking Requirements
Industry established common practices, rules, and methods of doing business. The activities and techniques of determining the desired levels of items, whether raw materials, work in process, or nished products. Demand for inventory may be dependant or independent. Inventory functions are anticipation, hedge, cycle (lot size), uctuation (safety, buer or reserve), transportation (pipeline), and service parts.
3.6.38
Inputs/Outputs
Input/Output
Stocking Schedule
Denition
A timetable for the planned movement of material from a bulk storage area to an order pick storage area. History of a lack of materials, components, or nished goods that are ordered. A list of operations and procedures for allocating storage needs for items in inventory. The determination of inventory quantity by actual count. Physical inventories can be taken on a continuous, periodic or annual basis. A longer range, high-level plan that describes how a company intends to conduct business. Improve its market and competitive position, and increase its earnings performance. The installation of product is completed at the customer site, and the product is fully functional. An agreement between supplier and purchaser to perform or not to perform specic acts or services or to deliver merchandise, such as purchase order or supplier contract.
Process
D4.4: Stock Shelf D4.1: Generate Stocking Schedule P4.1: Identify, Prioritize and Aggregate Delivery Requirements D4.1: Generate Stocking Schedule
Stock-out History
Store Allocation Instructions Store Shelf Inventory Counts
D4.4: Stock Shelf P4.1: Identify, Prioritize and Aggregate Delivery Requirements EP.1: Manage Business Rules for Plan Processes EP.10: Align Supply Chain Unit Plan with Financial Plan D4.7: Deliver and/or Install
Strategic Plan
Successful Installation / Live System Supplier Agreement
ES.5: Manage Capital Assets EM.6: Manage Transportation (WIP) ES.10: Manage Supplier Agreements S3.3: Schedule Product Deliveries S3.2: Select Final Supplier (S) and Negotiate ES.7: Manage Supplier Network ES.10: Manage Supplier Agreements ES.2: Assess Supplier Performance ES.10: Manage Supplier Agreements S3.2: Select Final Supplier (S) and Negotiate ES.1: Manage Sourcing Business Rules ES.7: Manage Supplier Network S3.1: Identify Sources of Supply ES.3: Maintain Source Data S1.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries ES.2: Assess Supplier Performance S2.1: Schedule Product Deliveries ES.7: Manage Supplier Network EP.3: Manage Plan Data Collection
Supplier Data
Data or information about the supplier. This data can be organizational , product, information , nancial. Structured supplier data is needed to set up and implement ERP or similar systems.
Supplier Performance
The results of measuring the actual supplier performance on cost, quality, engineering, purchasing, and so on, based on an agreed set of measurements. Information necessary to plan the balance of supply chain resources to demand requirements at both the highest aggregate and lowest SKU planning levels.
3.6.39
Inputs/Outputs
Input/Output
Supply Chain Performance Improvement Plan
Denition
A plan that describes goals and objectives for a supply chain and the steps that will be taken to reach those goals and objectives from the current performance levels. Standard measures that indicate how well a supply chain performs within certain categories of performance known as Performance Attributes, e.g. delivery reliability, exibility and responsiveness, cost, and asset management.
Process
P5.3: Balance Return Resources with Return Requirements P1.3: Balance Supply Chain Resources with SC Requirements EP.2: Manage Performance of Supply Chain ED.2: Assess Delivery Performance ES.4: Manage Product Inventory ED.1: Manage Deliver Business Rules EP.2: Manage Performance of Supply Chain ED.5: Manage Deliver Capital Assets EM.2: Manage Production Performance ER.2: Manage Performance of Return Processes P4.1: Identify, Prioritize and Aggregate Delivery Requirements EM.7: Manage Production Network P2.1: Identify, Prioritize and Aggregate Product Requirements P5.1: Assess and Aggregate Return Requirements P1.4: Establish & Communicate SupplyChain Plans P3.1: Identify, Prioritize and Aggregate Production Requirements P1.3: Balance Supply Chain Resources with SC Requirements P1.1: Identify, Prioritize and Aggregate SC Requirements P1.2: Identify, Prioritize and Aggregate SC Resources P1.3: Balance Supply Chain Resources with SC Requirements EM.3: Manage Make Information ED.8: Manage Import/Export Requirements
Supply-Chain Performance Metrics
Supply Chain Plans
Courses of action over specied time periods that represent a projected appropriation of total supply-chain resources to meet total supply-chain demand requirements.
Supply Chain Requirements
Sources of demand for the integrated supply chain of a product or service at the appropriate level, horizon and interval. As a whole with constituent parts, all sources of supply that are required to add value in the supply chain of a product or service at the appropriate level, horizon and interval. The capability of a system to perform its expected function Charges established by a government which must be met before allowing the shipping or delivery of a product across national boundaries. Product being tranferred to the appropriate stocking location within the supply chain.
Supply Chain Resources
Systems Capability Taris & Duties
Transferred Product
S3.6: Transfer Product S3.7: Authorize Supplier Payment S2.5: Authorize Supplier Payment S1.4: Transfer Product S1.5: Authorize Supplier Payment S2.4: Transfer Product
3.6.40
Inputs/Outputs
Input/Output
Transportation Capacity
Denition
The capability of a trasportation system to perform its function.
Process
EM.2: Manage Production Performance EP.6: Manage Integrated Supply Chain Transportation EM.1: Manage Production Rules D1.2: Receive, Enter and Validate Order D1.2: Receive, Enter and Validate Order D1.3: Reserve Inventory and Determine Delivery Date
Validated Order
An order that has had the instructions / requirements validated i.e. the information that the order contains is accurate, consistent with previous information and does not violate business policies or rules.Note 1 - this does not make the order committed there may be other tasks to be performed before a commitment can be made. Note 2 - this order could be customer, internal, purchase or production. A validated and approved Return Product Authorization (RPA).
Validated Return Material Authorization
SR1.3: Request Defective Product Return Authorization SR3.3: Request Excess Product Return Authorization SR3.4: Schedule Excess Product Shipment SR1.4: Schedule Defective Product Shipment DR1.1: Authorize Defective Product Return DR2.1: Authorize MRO Product Return DR2.2: Schedule MRO Return Receipt DR1.2: Schedule Defective Return Receipt D4.1: Generate Stocking Schedule
Valid Returns Request
Requests for returns that are valid.
Vendor/DC inventory availability
Vendor/DC inventory available to a customer to supply demands. (Where the customer has access to the suppliers inventory and the supplier has access to the customers requirements and inventory or vendor managed inventory). The plan for a promotional product oering and how it is communicated to the customer and includes public relations, advertising, sales promotions, and other tools to persuade customers to purchase the product oering. Warehouse constraints are those storage items that impact on the supply chain eciency, including material handling equipment and personnel, equipment maintenance, building maintenance, and security personnel.
Vendor Merchandising / Co-op advertising agreements
D4.4: Stock Shelf
Warehouse Operating Constraints
3.6.41
Inputs/Outputs
Input/Output
Warranty Data
Denition
All data relevant to a warranty claim for a customer for replacement, repair or credit because the product received did not meet a commitment, either expressed or implied, concerning a certain fact regarding the product The rules for handling WIP items in the production and repair process. These rules include the movement and accounting for in-process items between work locations, in inventory, and movement inventory. Location of inventory that is specied as work in progress. This can be intermediate storage in a manufacturing facility prior to nal packaging or can be a class of materials waiting nal transformation to nished products. The process and rules for establishing and maintaining in-process item inventory ownership and stocking locations. The process of recording and tracking the movement of WIP items through the production and repair process. This process includes item stocking and accounting requirements. The sales or demand history that is analogous to the present situation for similar products, a SKU / Subclass.
Process
SR2.1: Identify MRO Product Condition SR1.1: Identify Defective Product Condition ER.8: Manage Return Regulatory Requirements and Compliance EM.6: Manage Transportation (WIP) EM.4: Manage In-Process Products (WIP) M3.3: Issue Sourced/In-Process Product M1.2: Issue Material M2.2: Issue Sourced/In-Process Product S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product EM.6: Manage Transportation (WIP)
WIP Handling Rules, Move Information and Methods
WIP Inventory Location
WIP Location Rules
M2.2: Issue Sourced/In-Process Product D2.9: Pick Product M3.3: Issue Sourced/In-Process Product M1.2: Issue Material EM.6: Manage Transportation (WIP) EM.6: Manage Transportation (WIP)
WIP Move Information and Metholds
Year-to-Year for Like SKU/ Subclass
3.6.42
Section 4 Best Practices
SCOR
Available-to-Promise (ATP)
Available-to-Promise (ATP) provides an availability and feasibility check concerning a customer request or a customer order whereas three outputs can be distinguished: 1. the soonest delivery date concerning the customer request, 2. the conrmation of desired delivery date, item quantity, and item conguration 3. the selection of alternative, but deliverable product variants in case the desired delivery parameters can not be fullled. ATP is applicable over multiple sites in a global environment. Essentially, it is based on the extrapolation of the available inventory in all relevant locations over time: ATP is the uncommitted portion of a companys inventory and planned production maintained in the master schedule to support customer-order promising. The ATP quantity is the uncommitted inventory balance in the rst period and is normally calculated for each period, in which an MPS (Master Production Schedule) receipt is scheduled.
SCOR Process(es) D1.3 (Reserve Resources and Determine Delivery Date) Best Practice Need and Suitability Indicators ATP is particularly suitable for environments where customers require on-time and fast deliveries. Additional Comments Three methods of ATP calculations are used: discrete ATP, cumulative ATP with look-ahead, and cumulative ATP without look-ahead. Discrete available-to-promise is calculated based on beginning inventory, planned production according to the master production schedule (MPS) and customer commitments. For the rst period, the available-to-promise is the sum of the beginning inventory plus the planned production for the rst period minus customer commitments for the rst period and all periods following the rst period up to, but not including, the next period for which production has been scheduled in the MPS. For the following periods, there are two possibilities: If a master production quantity has been scheduled for the period the available-to-promise is the quantity scheduled minus all customer commitments for the period and for all following periods up to but not including, the next period for which a master production quantity has been scheduled. If no master production quantity has been scheduled for the period the available-to-promise is zero, even if deliveries in the period have been promised. The promised shipments often are shown as backlog (customer commitments) in the period with the most recent production (MPS). Cumulative available-to-promise is a calculation based on the available-to-promise (ATP) gure in the master schedule. Two methods of computing the cumulative available-to-promise are used, with and without look-ahead calculation. The cumulative with look-ahead ATP equals the ATP from the previous period plus the MPS of the period minus the sum of the dierences between the backlogs and MPSs of all future periods until, but not to include, the period where point production exceeds the backlogs. The cumulative without look-ahead procedure equals the ATP in the previous period plus the MPS, minus the backlog in the period being considered.
4.1.1
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Other Success Factors Experienced Impact improves on-time delivery resulting in a higher service level (to commit date). reduces cycle times of certain administrative processes (e.g. denition of delivery date, order placement) allows determining whether exibility is appropriate to cover future demand uctuations and to prioritize activities accordingly. None (except for less contract penalties caused by late deliveries) Visibility of demand vs. production schedule and available inventory can result in better inventory planning and lower inventory levels. Available-to-promise requires implementation in an ERP-/SCM-/APS-software solution. Appropriate data management guarantees exact ATP quantities.
Key Best Practice Success Factors
Additional Resources Cox, J. F.; Blackstone J. H. (2004): American Production and Inventory Control Society (APICS) Dictionary, 11th edition, APICS The Educational Society for Resource Management, Alexandria, VA Schnsleben, P. (2003): Integral Logistics Management Planning & Control of Comprehensive Supply Chains, St. Lucie Press, Boca Raton, FL, p. 233-235
4.1.2
SCOR
Carrier Agreements
Carrier agreements are agreements between a company and its domestic and global carriers (for both, inbound raw materials and outbound nished goods) specifying service levels, payment terms, and other conditions. Such agreements can be established as part of a larger initiative to decrease raw material and nished goods inventory, while improving customer service. Contractual partnership requirements can include: Perfect Order Fullment (as a primary goal), equipment condition shipping condition pick-up and delivery times, documentation. Carrier performance in these elds is measured with immediate feedback and monthly formal reports. By measuring all carriers on a regular basis, trends of performance can be seen. This provides the opportunity to replace carriers performing poorly with those performing exceptionally. Furthermore, a transportation service agreement is signed with all domestic and global carriers. Contract line items specify on-time delivery, plus the payment requirements for services rendered.
SCOR Process(es) S1.2, S2.2, S3.2 (Receive Product), ES.2 (Assess Supplier Performance), ES.7 (Manage Supplier Network), ES.9 (Manage Supplier Agreements), D1.11, D2.11, D3.11 (Load Vehicle & Generate Shipping Documentation) Best Practice Need and Suitability Indicators Any company receiving or shipping materials using common or contract carriers such as trucking, shipping, and airline companies. Also includes internal transportation providers (company owned transportation group). Additional Comments The top performance of carriers is due to a thorough knowledge of the industry and the requirements of a company, as well as the contract that is used with the carriers. Without a competent transportation manager, the contract, alone, would be of little value. The combination of trained, competent personnel and written agreements result in superior performance.
4.1.3
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Experienced Impact Better partnerships with and management of carriers typically results in improved on time deliveries. Carrier agreements often improve the ability to quickly book and execute transportation, reducing lead times. Partnerships tend to work both ways, leading carriers to make additional capacity available to partners when needed, improving the ability to respond quickly to demand increases. Carrier agreements provide a tool for both shipper and carrier to identify and take advantage of mutual cost savings. More ecient use of transportation assets to move customer orders.
Costs Asset Management Technology Features Other Success Factors
Key Best Practice Success Factors From the carrier side, their tracking systems support performance measurement to a dierent degree (EDI, web-enabled carriers). Continuous on line tracking of shipment would be benecial. Anyone interfacing with the carrier needs to be familiar with the carrier agreement specications. Formal recognition of carriers, for example, they can be certied on basis of six months reliability/compliance to the agreement. Formal feedback on monthly performance and immediate feedback on failures to comply with specications. Additional Resources None Identied
4.1.4
SCOR
Collaborative Planning, Forecasting and Replenishment (CPFR)
The CPFR reference model provides a general framework for the collaborative aspects of planning, forecasting and replenishment processes. The model is considered a guideline for trading partner collaboration, which should be tailored specially for the industry and company readiness and maturity. CPFR denes eight collaboration tasks: Collaboration Arrangement is the process of setting the business goals for the relationship, dening the scope of collaboration and assigning roles, responsibilities, checkpoints and escalation procedures. The Joint Business Plan then identies the signicant events that aect supply and demand in the planning period, such as promotions, inventory policy changes, store openings/closings, and product introductions. Sales Forecasting projects consumer demand at the point of sale. Order Planning/Forecasting determines future product ordering and delivery requirements based upon the sales forecast, inventory positions, transit lead times, and other factors. Order Generation transitions forecasts to rm demand. Order Fulllment is the process of producing, shipping, delivering, and stocking products for consumer purchase. Exception Management is the active monitoring of planning and operations for out-ofbounds conditions. Performance Assessment calculates key metrics to evaluate the achievement of business goals, uncover trends or develop alternative strategies. Based on this general framework, CPFR discusses collaboration scenarios (like replenishment collaboration or collaborative assortment planning), collaboration roles (who of the two partners involved is responsible for collaboration tasks), and organizational implications within partner companies. The CPFR industry standard is sponsored by VICS, the Voluntary Inter-industry Standards body and the Uniform Code Council, UCC. The standard has also been adopted by the Global Commerce Initiative, GCI.
SCOR Process(es) P1 (Plan Supply Chain) Best Practice Need and Suitability Indicators Companies that heavily rely on demand forecast accuracy and high volume replenishment are primary beneciaries of the standard. Additional Comments CPFR has primarily been adopted by the retail and consumer package goods industry. Wal-Mart was the founding company of the process and recently announced adoption by 1,200 of its suppliers. The process has also been adopted by the grocery industry as well as the chain drug store industry.
4.1.5
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Experienced Impact Better Store in stock Better customer service 2% - 8% 2% - 8%
Faster Replenishment Cycle Times 12% - 30% Forecast improvement Lower Logistics Cost Inventory Reduction 20% - 40% 3% - 4% 10% - 40% (AMR)
Key Best Practice Success Factors VICS CPFR interoperability technology standards documented and published by the CPFR Working Group. Standards support EDI 830, EDI 852, and XML Interoperability. Standards published for data modeling. Careful selection of trading partners. Having a joint front-end agreement to refer back to when the project gets o track.
Other Success Factors Additional Resources
www.cpfr.org is the ocial website for the VICS CPFR Working group. This site contains multiple publications on CPFR as well as the actual CPFR process mapping guidelines, data model formats, and CPFR presentations. Suleski, Janet (2001): Beyond CPFR: Retail Collaboration Comes of Age, AMR Research, April 1, 2001. www.globalscorecard.net The Global Scorecard. This site provides a Capability Assessment Tool designed to give you a detailed understanding of your ECR (Ecient Consumer Response) capability and highlight specic improvement opportunities for your company. ECR was an early foundation for CPFR. www.drummondgroup.com The Drummond Group on CPFR interoperability has certied technology companies. Test results are available on their web site.
4.1.6
SCOR
Co-Located Procurement Representatives
Regionalized Procurement Representatives are positioned in local markets to support corporate / procurement goals. Companies realize support is needed when cost and delivery objectives are not consistent with organizational goals. This leading practice involves identifying local procurement personnel to assist in creating a supply base to meet internal and external product requirements. These local representatives will perform all procurement related activities for the organization. Co-located procurement personnel bring the knowledge of the local supply base, understand their organizations demand and supply signals, and communication capability to work with company global commodity leadership. For companies expanding their sourcing scope and distance, having personnel local to the market is a crucial element to maintaining supply chain performance. Local personnel are used to support the understanding of the demand and supply signals, production and logistics decisions. Companies that have sourced globally, but have not added local resources nd challenges that diminish supply chain response time. Listed are some of the major factors: 1.) Communication (time, language, cultural) 2.) Lead time, 3.) Hidden Costs (taxes, taris, etc.), 4.) Quality Returns and Repairs, 5.) Political and Geography Risks, 6.) Units of Measure. Cost is the huge driver in this Best Practice. For example, decisions aecting the supply chain can be made more accurately and in a timelier manner by experts in the eld who can experience the day-to-day activities.
SCOR Process(es) P1 (Plan Supply Chain) Best Practice Need and Suitability Indicators The best practice is most of all suitable for companies that source a large portion of their procurement volume in low-wage countries with a dierent culture. Additional Comments Regular meetings at least once a year among peers should be organized to share priorities and to align processes and reapplication opportunities.
4.1.7
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Experienced Impact Increase Order Fill Rates Reduction in Product Lead-Time Improved Supply Chain Response Time Improved Source/Make Cycle Time Improved Production Plan Achievement Reduced Inventory Obsolescence Impacts Purchase Order Costs Reduced Quality Returns Increase Capacity Utilization Decrease Inventory Obsolescence Accessibility, accuracy, timeliness and visibility of enterprise-wide procurement information. Commercial software (of varying degrees of sophistication) is available to support the procurement and planning processes. None identied
Flexibility Costs Asset Management
Key Best Practice Success Factors Technology Features
Other Success Factors Additional Resources None Identied
4.1.8
SCOR
Convergence of SCOR, Six Sigma and Lean Methodology
SCOR, a cross-industry top-down standardized process analysis model, enables the ecient and eective end-to-end evaluation of supply chains. By capturing operational baselines and comparing to industry peers and competitors, SCOR level one metrics provide a balanced measure of performance linked to the bottom line. Metrics and Best Practices steer teams to proven solutions, and the building block design provides a common language for both internal and external elements of a supply chain. SCOR therefore serves as a strategic project identication and prioritization engine for Lean and Six Sigma teams and provides the means to measure business impact. The strength of Six Sigma and Lean is producing results. These powerful methodologies can be used to gain eciency and construct valuable processes because these disciplines, by their nature, look down at nite areas, cells, or processes to improve. They cannot look upward at organizational goals and select the best project on which to work. SCOR also helps introduce the concepts of Six Sigma and Lean to transactional (non manufacturing) areas not normally associated with productivity or quality initiatives. With its cross functional makeup a SCOR project team will focus on reducing variability and eliminate waste in areas such as accounting, customer service, and sales.
SCOR Process(es) None Identied Best Practice Need and Suitability Indicators Need to prioritize lean and six sigma project according to their eects on organizational goals. Additional Comments This Venn Diagram highlights tools of each methodology:
TOOLS (Examples only) SIX SIGMA
PFMEA ANOVA Gage R&R SPC Process Simulation Multi-Vari Analysis Regression Analysis DOE (Design of Experiments) Control Plans 7 Basic Quality Tools: Pareto Cause & Effect Histograms Control Charts Scatter Diagrams Graphs Check sheets PDCA/ SDCA
Kaizen Kanban Single Minute Exchange of Die (SMED) Takt Time Poke Yoke
COPQ/Financial Analysis Program Mgmt Multi-Level Pareto Analysis/ SIPOC Decomposing Project Mgmt Metrics Process Mapping/ GAP Analysis Value Stream Mapping/ Voice of the Geographic Mapping/ Customer Thread Diagram QFD (Quality Function Deployment) Standardized Work/ Best Practices Reference Model Organization Map SCORcard Level One Operational Process Metrics Level Two Diagnostic Metrics Level Three
7 Mgmt Tools: Relations Diagram Affinity Diagram Tree Diagram Matrix Diagram Matrix Data-Analysis Arrow Diagram PDPC
Supplier/Customer Performance Scorecards Inter-Company Kanban CPFR
LEAN
SCOR
4.1.9
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Other Success Factors Additional Resources There is a Supply Chain Council Special Interest Group on this Best Practice. Please contact the group, if you would like to contribute to the convergence of SCOR, Six Sigma and Lean Methodology. Experienced Impact Convergence of SCOR, Six Sigma and Lean Methodology (with SCOR as a strategic project identication and prioritization engine) enables organizations to improve the right performance attributes, which can be any set of SCOR level one metrics. See other SCOR Best Practices and especially the Best Practices Six Sigma and Lean Methodology for possible impacts.
Key Best Practice Success Factors None Identied None Identied
4.1.10
SCOR
Cross Docking
Cross docking is used in many distribution centers (DC) to increase inventory velocity while maintaining shipping eciency. In a traditional DC, the receiving process is disjointed from the shipping process and storage acts as an intermediary between the two processes. Cross docking actively links the receiving and shipping processes. In a DC, both cross docking (no storage) and traditional (with storage) operations might take place. Cross docking minimizes the need to put incoming inventory into storage and the number of touches for each order. To accomplish this, the receiving activity is linked with open order status. Each inbound shipment has a planned outbound already scheduled. When an item is received, the system will look to the open order le to nd its outgoing order. The item is moved from receiving directly to the order staging area, order pick area, or into an outbound vehicle. Three common types of cross docking are: 1. Trans-shipment: The order received is already packaged for delivery to the customer
Ship A Receive A B C Move B
Customer B Customer A
C
Customer C
The Pennsylvania State University
2. Flow-through: Some sortation or break bulk is needed when the order is received
Pick Receive Allocate Ship
Customer A
Customer B
Customer C
3. Merge-in-transit: Current inventory in storage at the DC is added to the incoming order (see separate Best Practice).
Pick Storage Receive Allocate
Customer A
Ship
Customer B
Customer C
(Courtesy: Robert Novack, Penn State University, University Park)

4.1.11
SCOR
SCOR Process(es) D1.8 (Receive Product from Source or Make), D1.11 (Load Vehicle & Generate Shipping Documentation), D1.12 (Ship Product)
Best Practice Need and Suitability Indicators Small shipment sizes (economies of scale through bundling shipments) Constrained distribution center capacity Perishability of products Additional Comments Suppliers usually need to make some type of investment (customized bar codes, special overpacks, or unique pallet patterns) to participate in cross-docking. Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Experienced Impact None Identied None Identied None Identied Reduces transportation costs (compared to transportation without crossdock), because de-consolidation at cross-dock for multiple receivers allows shippers to deliver larger shipments Reduces average inventory level and (as a consequence) working capital invested in inventory Cross docking requires the use of a Warehouse Management System (WMS), which needs to interface with the order management system. Bar codes and RF scanners will allow the receiving function at the DC to become more productive. The use of EDI messages, especially of ASNs (Advance Ship Notices) is highly benecial. The shipper sends an ASN to the receiver as a notice that a shipment has been sent, allowing the receiving facility to more productively schedule order picking and outbound deliveries. Other Success Factors Additional Resources None Identied None Identied
Asset Management
4.1.12
SCOR
Drum-Buer-Rope Scheduling Technique
Drum-Buer-Rope (DBR, also referred to as Synchronous Manufacturing, or Constraint Management) is, in the Theory of Constraints (TOC), a technique used to manage resources to maximize throughput. The Drum is the systems constraint (or bottleneck) that sets the pace for the entire organization. Such a bottleneck determines the nal output of the system regardless of the excess capacity that might be available on the other resources. (In DBR terminology, the drum is also the schedule of the constraint.) The Drum Buer is a time oset (raw material will be released earlier than expected by the conventional lead time) that helps exploit the drums capacity. Placing the buer in front of the drum we reduce/absorb the impact of uncertainty along the production chain from the gating operations all the way to the constraint. The drum buer can be seen as a powerful tool in helping us prevent the drum from starving. The Rope is the material release schedule tied to the drum. With the rope we make sure that no material is released to the shop oor without the prior approval of the drum. The shop oor has a virtual rope tying the drum to the gating operations, each time the drum nishes a lot it will pull this rope to ask for more material to be released. This powerful concept (global management vs. localized approach) has an immediate impact on both lead time and WIP. Release only what is needed when it is needed!
SCOR Process(es) M1.1 (Schedule Production Activities), M2.1 (Schedule Production Activities), M3.2 (Schedule Production Activities) Best Practice Need and Suitability Indicators High Work-in-progress (WIP) with deteriorating throughput Unpredictable manufacturing lead times (e.g. due to many prioritized production orders) Mature serial or mass production running at a xed rate The technique is mainly suitable for machine-limited capacities. Additional Comments In the application of Drum-Buer-Rope (DBR), the eectiveness of the pace setting operation (drum) is critical for maximizing throughput. The Overall Equipment Eectiveness (OEE) is the single metric that reects that eectiveness. OEE is the result of multiplying Availability (up-time) Run time divided by scheduled time (also 1 minus downtime) Quality Rate (rst pass yield) First-pass good units produced divided by total units produced Performance Eciency Theoretical cycle time by the actual cycle time. Theoretical cycle time should be that, which was promised by the production equipments manufacturer. (In practice theoretical cycle time often is downgraded by industrial engineers applying factors such as personal fatigue and delay to derive a standard cycle time, which is used to cost the product and provide planning an attainable capacity quantity.)
4.1.13
SCOR
Additional Comments cont. The dierence between the OEE value and 1.0 indicates the percentage of production lost to ineective operations. Examining the components of OEE will enable root cause analysis and direct corrective action. Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Other Success Factors Additional Resources Cox, J. F.; Blackstone J. H. (2004): American Production and Inventory Control Society (APICS) Dictionary, 11th edition, APICS The Educational Society for Resource Management, Alexandria, VA, USA Goldratt, E. M., Cox, J. (1992): The Goal A Process of Ongoing Improvement, North River Press, Norwich, CT, USA Spencer, M. S.; Cox, J. F. (1997): The Constraints Management Handbook, The St. Lucie Press/APICS Series on Constraints Management. Umble, M.; Mokshagundam L. S. (1995): Synchronous Manufacturing Principles for World Class Excellence, Spectrum Publishing Company. Hansen, R. C. (2002): Overall Equipment Eectiveness, Industrial Press, New York, NY, USA. Mondher, B.-H.: Synchronous Manufacturing Quick Reference Guide, Supply Chain Strategy and Solutions, BearingPoint, Inc. Experienced Impact Increases perfect order fulllment, as manufacturing lead time gets more predictable Increases with decreasing manufacturing lead time None Identied Higher equipment eectiveness reduces cost of goods sold Reduces WIP, leads to a higher equipment eectiveness None Identied None Identied
4.1.14
SCOR
Lean Methodology
Lean is a term coined in 1990 in the book The Machine that Changed the World by MIT researchers to describe the eectiveness and eciency of the Toyota Production System in comparison to the traditional mass production approach to manufacturing. Lean practices actually date back to the early 1900s when Sakichi Toyoda introduced jidoka (autonomation) into his loom operations. The modern understanding of lean comes from the Toyota Production System developed by Taiichi Ohno, which was inspired by Henry Fords River Rouge moving assembly line. Lean thinking is a focus on creating process ow through the reduction of waste. The waste reduction in production environments is typically targeted at the seven wastes: overproduction, waiting, transportation, inappropriate processes, inventory levels, unnecessary motion, and defects. Lean Thinking is applicable to all processes. The typical enabler for lean improvement is through the use of Value Stream Mapping (VSM). VSM is the process of walking and drawing the process steps (material and information) for one product family from beginning to end, typically within a single facility, to create a current state map. Current state maps are designed to highlight the process ow of an item through the value stream. Following the current state map, a future state map is created. Future state maps are then developed to identify process improvements that eliminate waste. Finally, a detailed implementation plan is developed to transition from the current state to the future state, typically within an 8-12 month period. VSM can also be applied similarly across suppliers to create supply chain value stream maps. While lean excels at improving process eciency, there are some limitations to lean application. Lean implementations are typically limited by the inability to systematically identify and prioritize lean projects, measure the eects of changes on the supply chain systems bottom line, and align and communicate activities across organizations. See the Best Practice on Convergence of SCOR, Six Sigma and Lean Methodology to overcome this limitation. SCOR Process(es) aects any SCOR process Best Practice Need and Suitability Indicators Need for process cycle eciency improvements Need to reduce process cycle times Elimination of non-value added process steps Need to build a culture of lean thinking throughout Additional Comments Lean is a methodology and way of thinking to transform organizations into new levels of eciency, supported by a toolset for executing improvement projects that reduce process cycle time and increase process cycle eciencies. Execution is enabled through people, and must become the way work is done within the organization. Application of lean tools is based on the eective use of value stream mapping. This methodology relies heavily on the ability to record all steps throughout processes and to determine value added versus non-value added activities. Lean is a methodology supported by a toolset that is generally limited by the inability to strategically select projects that provide the greatest value to the overall organization.
4.1.15
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact enables organizations to determine how current process steps and cycle eciencies aect overall supply chain reliability. Details can be displayed through value stream mapping. Process cycle-time decreases (typically by around 70%) through eliminating non-value added process steps. Lean organizations have the worker exibility and adaptability to respond to surges and shocks in production. Lean creates process ow and allows for quick changeover between functions, tools, and processes. Lean facilities typically have considerable cross training, which creates highly exible teams of people and organizational layouts. Cost reduction is a typical impact of lean as non-value added processes are removed and eciency increases. Response times are also reduced which result in faster cash ow cycles. Lean typically reduces inventory levels and ensures the ecient use of assets with regard to customer demand. Suppliers are likewise encouraged to improve cycle eciencies to increase their available inventory for customers to pull from. Lean is people-oriented and can be successfully employed with minimal technological requirements. Some technology (e.g. a data warehouse with data extracted from an ERP source system) could potentially support an organizations application of lean. The successful transformation to lean is marked by the change in the way people address their work. Lean thinking must become a part of how work is done within an organization to have sustainable continuous improvement.
Responsiveness
Flexibility
Costs
Asset Management
Other Success Factors
4.1.16
SCOR
Additional Resources Womack, J. P., Jones, D. T. (1996): Lean Thinking Banish Waste and Create Wealth in Your Corporation, Simon & Schuster, New York, NY Suzaki, K. (1987): The New Manufacturing Challenge Techniques for Continuous Improvement, Simon & Schuster, New York, NY Keyte, B., Locher, D. (2004): The Complete Lean Enterprise Value Stream Mapping for Administrative and Oce Processes, Productivity Press, New York, NY Liker, J. (2004): The Toyota Way 14 Management Principles From The Worlds Greatest Manufacturer, McGraw-Hill, New York, NY Marchwinski, C., Shook, J., (2004): Lean Lexicon A Graphical Glossary for Lean Thinkers, Lean Enterprise Institute, Brookline, MA http://www.lean.org (Lean Enterprise Institute), http://www.lean.mit.edu (Lean Aerospace Initiative), http://www.superfactory.com (Superfactory)
4.1.17
SCOR
Merge-in-Transit
Merge-in-transit is a practice to combine items from multiple sources into a single customer shipment. This includes items on stock in the distribution center, from which the shipment is sent, items on stock in other distribution centers, items on stock elsewhere (e.g. at a plant or a supplier) as well as make-to-order items. The items to be merged are cross-docked from inbound receipt to outbound shipping (see Best Practice on Cross-Docking, type three). Merging is usually performed in a shippers distribution center (DC) or in a carriers terminal. Merge-in-transit allows the shipper to reduce its inventory levels on selected items in its DCs while still maintaining complete order integrity and reliable delivery. The practice increases overall delivery times, though. To keep delivery reliability to customers, supply chain information systems are required, which integrate among the shipper, its suppliers, and its carriers. For make-to-order (MTO) products, the order lead time should be greater than the manufacturing lead time. Otherwise, the products should be manufactured and stocked prior to the shipment. The point is emphasized here to ensure that the proper business policy is adopted around dening MTO versus MTS (make-to-stock) products.
SCOR Process(es)
D1.8 (Receive Product from Source or Make), D1.9 (Pick Product)

Best Practice Need and Suitability Indicators Customer orders require commingling of products from dierent sources into a single shipment Order lead time is sucient to allow collect products from their source locations Additional Comments Merge-in-transit is a Place Postponement (see Best Practice on Postponement) for parts of the supply chain.
4.1.18
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Experienced Impact Delivery reliability is at risk, information technology is required to keep it. Delivery time and as a consequence order fulllment time increases Allows exibility in a make-to-order manufacturing environment, if manufacturing lead time is shorter than order lead time. DC exibility improves because of ability to cross-dock selected inbound items. None Identied Inventory level (and as a consequence working capital) is lower, as products are kept on stock in fewer locations. This practice will require the use of some type of warehouse management system (WMS), bar code or RF scanner technology, and EDI (or some other technology that would allow the transmission of data between supply chain partners). It might also require the integration of MRP or other scheduling technology with the WMS. All will need to interface with the order management system. Agreements with suppliers and carriers on: Delivery time requirements Inventory policies at the supplier locations and DCs Packaging items to produce the combined shipment, including generation of packing slips and other documentation are required. All involved parties must agree on the types and timing of information exchange. Since DCs will have lower inventory levels as a result of using this practice, extended stock-outs at suppliers or unreliable delivery times by carriers would negatively impact the customer delivery experience. Additional Resources None Identied
Costs Asset Management
4.1.19
SCOR
Postponement
Postponement (delayed dierentiation) is a supply chain concept where a product is kept as long as possible in a generic state. Dierentiation of the generic product into a specic endproduct is shifted closer to the consumer by postponing identity changes, such as assembly or packaging, to the last possible supply chain location. This allows keeping safety stock of one generic product instead of multiple specic endproducts. Especially in cases where the split of demand into specic end-products is uncertain, postponement with its risk pooling eect leads to less safety stock required and to a lower risk of obsolescence of end-products. Furthermore, as less value has been added to the generic product than to the specic end-product, less capital is bound in each stocked unit. There are three ways to implement postponement: Product postponement A modular structure of the product allows late dierentiation, e.g. adding country-specic power plugs shortly before shipment. Place postponement Safety stock is kept in one central warehouse instead of regional warehouses. Time postponement Processes which let the product become dierentiated (e.g. coloring, ashing an EPROM with software) take place as late as possible.
SCOR Process(es) S1 (Source Stocked Product) , M1 (Make to Stock), D1 (Deliver Stocked Product) Best Practice Need and Suitability Indicators Signicant number of variants of an end product with an uncertain split of demand on variants. Delivery time requested by customers must allow value-adding steps after receipt of customer orders (or reliable demand forecast). Additional Comments Product postponement leads to economies of scale in procurement and production as well, since the generic product will be produced in larger amounts than its variants.
4.1.20
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Other Success Factors Experienced Impact With the same safety stock, ll rate will typically increase. Order fulllment cycle time increases, if value-adding steps are carried out after receipt of a customer order (see need indicators) Increases, because a wide range of specic end-products can be derived from the stocked generic product. None Identied (except from economies of scale, see additional comment) A lower safety stock level (without eect on ll rate) reduces xed assets. None Identied For product postponement, an intelligent, modular product structure is a pre-requisite, so that logistics and/or supply chain management have to be involved in the product development process. To support the development process, logistics/supply chain management has to provide a clear estimation of the eects of product design (especially the number of variants) on production and logistics costs.
Additional Resources Cox, J. F.; Blackstone J. H. (2004): American Production and Inventory Control Society (APICS) Dictionary, 11th edition, APICS The Educational Society for Resource Management, Alexandria, VA, USA Simchi-Levi, D.; Kaminsky, P.; Simchi-Levi, E. (1999): Designing and Managing the Supply Chain: Concepts, Strategies, and Cases, McGraw-Hill/Irwin, p. 56
4.1.21
SCOR
Sales and Operations Planning (S&OP)
Sales and operations planning (S&OP) is a process to develop tactical plans that provide management the ability to strategically direct its businesses by integrating customerfocused marketing plans for new and existing products with the management of the supply chain. The process brings together all the plans for the business (sales, distribution, inventory, production, procurement) into one integrated set of plans. This set of plans typically covers at an aggregate (product family) level a period of 8 to 18 months with monthly periods and further years with half-year periods. S&OP is revised on a regular basis, most commonly monthly, but at least twice a year. The process must reconcile all supply, demand, and new-product plans at both the detail and aggregate levels and tie to the business plan. It is the denitive statement of the companys plans for the near to intermediate term, covering a horizon sucient to plan for resources and to support the annual business planning process. Typically, Sales and Operations Planning includes four key monthly meetings: 1. Demand review (to align the sales forecasts for the next months) 2. Rough cut capacity planning review (to determine the available facilities and assess the feasibility of the production plans) 3. Pre-top Management review (to agree upon points to be escalated to top management) 4. Top Management review (to get plans authorized, issues xed and nancial plans committed).
SCOR Process(es) P1 (Plan Supply Chain) Best Practice Need and Suitability Indicators Variability or misbalance in demand and/or supply, need to balance supply and demand across the supply chain. Conicting measures and behavior in various departments Inventory unbalanced across the supply chain Asset Utilization below industry norms Especially important if operations are to a large extend planned to forecasts Additional Comments None Identied
4.1.22
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Eective S&OP plans will allocate resources such that inventory is in place at the correct locations at the correct time so that when customer orders come in they can be fullled within normal procedures/processes S&OP points out where the supply chain has lead-time issues. It raises the visibility of lead-time problems. The S&OP process makes potential issues visible early, so that changes can be made to accommodate the dynamics of the supply chain. In particular, S&OP helps reduce the number and impact of expedites and rush production orders both of which have a negative impact on supply chain costs. S&OP allows an enterprise to operate much closer to target production and inventory plans, and thus leads to lower inventory levels and more ecient use of assets. S&OP is essentially a PEOPLE process that can be achieved with minimal technology support. In some cases, Excel spreadsheets are adequate. Accessibility, accuracy and timeliness of aggregate enterprise-wide data are critical, though. Ideally strategic external data (e.g. customer forecasts, copacker capacity/costs) would be an important asset to the S&OP process. Managers should have visibility to the plans of all departments. They should also understand the impact of their deviations from plan on the other departments and the enterprise as a whole. Performance to plan should be measured. Top Management sponsorship and involvement is essential for the success of S&OP.
Responsiveness Flexibility Costs
Asset Management
Additional Resources Civerolo, J.; Rice, D.: Sales and Operations Planning Handbook, Gray Research.
4.1.23
SCOR
Six Sigma
Six Sigma is based on a philosophy of driving for near perfect process performance (3.4 defects per million opportunities for a defect) in order to satisfy customer needs and improve nancial performance. Individuals can be trained in the various roles of Six Sigma, including Deployment Champions, Black, Green, and Yellow Belts. These practitioners then lead project teams made up of people from the operation through the use of the methodology to dene and solve problems. Six Sigma improvements are enabled through a rigorous methodology referred to as DMAIC (named for the phases of Dene, Measure, Analyze, Improve, and Control). The DMAIC methodology for problem solving utilizes both process and statistical analyses to improve product/process quality and drive reduction of defects and variation. The methodology generally provides a systematic way to dene the problem being addressed from both a process and nancial impact perspective, identify potential factors impacting performance, narrow to the critical few root causes of defects or variation, and then establish procedures to implement sustained performance improvements. A couple of apparent limitations with Six Sigma are the lack of alignment of priorities, understanding the interdependency between projects, i.e., incremental process improvements versus process redesign, and the lack of methods to develop future projects once the initial hit lists (pet-pains) become exhausted. See the Best Practice on Convergence of SCOR, Six Sigma and Lean to overcome this limitation.
SCOR Process(es) aects any SCOR process Best Practice Need and Suitability Indicators Need for signicant improvements for Product Quality or defect reduction Need to reduce process variability Additional Comments Six Sigma provides a standard toolset for executing improvement projects to increase product quality and reduce defects and process variability. Execution is enabled based on the Six Sigma steps of Dene, Measure, Analyze, Improve, and Control (DMAIC). Relies heavily on statistical data gathering and root cause analysis. Six Sigma is a toolset and generally lacks an organized method for project identication. Training in this methodology generally requires a costly investment.
4.1.24
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Suppliers and customers focusing on defect and variability reductions will increase product quality product and perfect order fulllment as a consequence. Improve order fulllment cycle time by reducing number of defective products produced, held in inventory or shipped and returned for warranty. Very important for new Product development deliveries. None Identied Reduces cost as process variability is minimized or removed. Reduces product return due to defects. None Identied A data warehouse (with data extracted from ERP source system) and electronic exchange of quality data with suppliers is useful. Teams should be set up with strong participation of the people directly working in the examined process. Six Sigma implementation should start with a small, controllable scope. Incremental learning prepares the organization for larger projects.
Responsiveness
Flexibility Costs Asset Management Technology Features Other Success Factors
Additional Resources Tennant, Geo (2000), Six Sigma: SPC and TQM in Manufacturing and Services Pande, Peter S., Neuman, Robert P., Cavanagh, Roland R. (2000), The Six Sigma Way: How GE, Motorola, and Other Top Companies are Honing Their Performance Pande, Peter S., Holpp, Lawrence (2001), What Is Six Sigma? Snee, Ronald D., Hoerl, Roger (2002), Leading Six Sigma: A Step-By-Step Guide Based on Experience with GE and Other Six SIGMA Companies Eckes, George (2003), Six Sigma for Everyone http://www.isssp.com/ International Society of Six Sigma Professionals (ISSSP)
4.1.25
SCOR
The Statistical Test Count (STC) process is a method of validating inventory on-hand values by physically counting and reconciling a statistical sample of the entire inventory population. This sample is then extrapolated, which provides an indicative measure of entire inventory population. Furthermore, with extrapolation the net and gross percentage of error is determined. One of the primary benets of this process is a signicant reduction in the time and manpower required to perform an audit control over data gained with STC meets or exceeds all requirements of both internal and external auditors. In contrast to physical inventory and cycle count methods STC creates virtually no disruption to receiving/ shipping. Interim reporting allows for monitoring of early results. STC provides a snapshot of piece count and inventory value accuracy level. Measurable results on both are achieved that can be benchmarked year-to-year, facility-to-facility, and network-to-network. Benchmarking is a proactive driver for inventory accuracy improvement.
SCOR Process(es) ES.4 (Manage Product Inventory), ES.5 (Manage Capital Assets), ED.4 (Manage Finished Product Inventories), ED.5 (Manage Deliver Capital Assets) Best Practice Need and Suitability Indicators Statistical Test Count is particularly benecial in high SKU count environments. Additional Comments The Statistical Test Count process is based on validated statistical theorems that meet independent auditor annual inventory validation requirements.
4.1.26
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Through constant measurement and root cause analysis, use of the STC process promotes greater inventory accuracy to support perfect order fulllment. Unlike cycle count and physical inventory methods, STC does not impede daily operations and does not require warehouse shut-down. The STC process requires a low volume of counts that can be executed during o-peak times as resource availability allows. Signicant cost avoidance as a result of decreased time and manpower to perform a physical audit implementing STC typically delivers up to a 90% cost reduction over physical inventory/cycle count methods. The diagnostic capabilities of Statistical Test Count identify opportunities to recover against previous inventory shrinkage (balance sheet implications). STC uses part cost and other SKU characteristics to select a statistical sample that is indicative of the entire inventory population. STC also uses condence intervals and other statistical tools to manage application of the program over time. STC does not require high investments in technology. It can be implemented with common spreadsheet software, for example. Other Success Factors The STC process delivers the greatest value in an environment of strong process discipline and commitment to continuous improvement. Results of the STC process should embedded in established process disciplines to address any unexpected deciencies through adjusted sample size and root cause analysis. Additional Resources Statistical Test Count is currently not well documented in literature. The following books deal with inventory accuracy in general: Wild, T. (2004): Improving Inventory Record Accuracy: Getting your stock information right. Brooks, R.B.; Wilson, L.W. (1995): Inventory Record Accuracy: Unleashing the Power of Cycle Counting
Asset Management
4.1.27
SCOR
Supplier Performance Assessment System
Assess Supplier Performance is the process of measuring actual supplier performance against internal and/or external standards, providing feedback to achieve and maintain the performance required to meet the customers business and/or competitive needs. The supplier management program at a representative company has six elements: 1. Viability of supplier Financial credit rating via D & B, Risk rating associate with overall nancial health. 2. Supplier Capability Quality of supplier deliveries in PPM for Engineering programs and Production parts 3. Dependability On time delivery for Engineering programs and Production deliveries, number of stock outs, average days of stock out 4. Responsiveness Part lead time, inventory turns 5. Competitiveness YTD part cost savings, number of parts on pull processes (JIT), electronic data exchange 6. Technical ability Global reach, Engineering ability, Technology roadmaps Each month, the source data is extracted from an ERP software for each supplier. A report card is created and communicated to suppliers. Performance data is monitored by commodity managers with the expectation that supplier responds to any variance to goals or expected results. This supplier performance data can be used to select suppliers for a preferred supplier program. Preferred suppliers are given preference for all new business awards and supporting Engineering development programs.
SCOR Process(es) ES2 (Assess Supplier Performance) Best Practice Need and Suitability Indicators Signicant expenses for raw material and semi-nished products (compared to own value-add) Need to reduce number of suppliers Additional Comments Suppliers are an external extension of the manufacturing process. In todays competitive environment, processes rely on dependable supply streams that react quickly to variability in demand.
4.1.28
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Source data is from transactions logged in ERP system. No arguments concerning their data vs. our data. Variance to goals is trigger for supplier to present corrective actions. Supplier and customer can focus on performance vs. data integrity. Detail data on delivery and quality are used to identify chronic performance issues for improvement. Improve reaction time for demand inside of lead-time. Mind share is maintained due to monthly performance scorecard. Very important for New Product development deliveries. Since new business is awarded to suppliers that perform well, suppliers are in a continuous improvement mode. Not an event, but expected throughout the year. Suppliers are encouraged to improve inventory turns by implementing pull systems for their parts. A data warehouse (with data extracted from ERP source system) and electronic exchange of performance data with suppliers is useful. Supplier Management Process, Supplier Survey and Evaluation process, and Supplier Performance Measurement process have to be dened; Source of data, and performance expectations need to be communicated to suppliers and stakeholders in the company (buyers, engineers). For critical suppliers, a qualication process is recommended to align the operational standards with the companys requirements.
Responsiveness
Flexibility Costs Asset Management
Key Best Practice Success Factors Technology Features Other Success Factors
Additional Resources None Identied
4.1.29
SCOR
Vendor Managed Inventory (VMI)
VMI is a concept for planning and control of inventory, in which the supplier has access to the customers inventory data and is responsible for maintaining the inventory level required by the customer. Re-supply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predened levels. The supplier takes responsibility for the operational management of the inventory within a mutually agreed framework of performance targets, which are constantly monitored and updated to create an environment of continuous improvement. Dierent styles of VMI agreements exist. Re-supply need not be on a scheduled basis. It can be more exible to occur within dened conditions, e.g. any day normal business hours. The customer can be included in the approval process: The supplier could propose a replenishment (quantity, date) and the customer has to approve the order. Often (but not necessarily) VMI is combined with consignment. The supplier owns items until they are taken from the VMI and used, i.e. items are to be paid when they are used.
SCOR Process(es)
P1, P2, P4, S1.1, S2.1, S3.3, ES.7, D1, D1.5, D1.6, D2.5, D2.6, D3.5, D3.6
Best Practice Need and Suitability Indicators Similar to conventional MRP planning of inventory, VMI implies manual planning and control tasks, but shifts these tasks to the supplier. This manual eort should be invested in such items, which are valuable and for which demand is unsteady or sporadic. For less valuable items with a continuous demand order point technique and kanban are more suitable. Additional Comments VMI works well, where demand and inventory data is readily available, systems are integrated, and economies of scale exist with large customers. Jointly Managed Information (JMI) is a derivation of VMI to use when and where VMI is not operationally or commercially practicable. Jointly-Managed Information is the automated collection, management, and integration of POS and inventory data into supplier inventory/materials management algorithms, independent of physical movements into the retail channel. This achieves many of the same benets as VMI when there exists a free ow of information among retail channel partners, without introducing what can be sensitive nancial relations between the parties. Retail partners often cannot or will not allow a vendor to automatically replenish them.
4.1.30
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Experienced Impact VMI helps to assure the availability of items thereby helping to ensure better on-time delivery performance as well as greater ll rates. Less time is spent waiting for items, allowing the production to operate more smoothly and quickly. With visibility of the demand cycle, you can agree to an ocial lead time, which can be reduced, and be predictable. Kraft, for example, realized a 15-20% reduction in lead times. The supplier gains exibility, when to re-supply, and as a consequence when and how much to manufacture. Inventory level decreases by up to 20% leading to lower inventory costs. The supplier gets a clear view of demand and exibility (see above), so that he can achieve lower variable manufacturing costs Transfer of ownership of inventory and payment terms vary depending on the VMI agreement. VMI has a focus on working capital, with the goal being both parties experiencing a working capital reduction. The eect will vary depending on the details of the VMI agreement. Specic capabilities must be in place for VMI to succeed. These include: Forecasting capability Replenishing capability Load building/order creation (at supplier) Reporting capability Electronic commerce infrastructure The addition of technology such as ERP and SCM applications will enhance these capabilities and hence the success of the VMI initiative. Depending on the company size, the number of suppliers and the number of items partners, technology may even be a prerequisite. In most VMI programs, technology plays a major role. Adding technology increases the complexity and cost of implementation, though. Access to data such as inventory levels, demand and demand forecasts is essential to a successful VMI program. VMI works very well in conjunction with CPFR Collaborative Planning, Forecasting and Replenishment. Other Success Factors Additional Resources http://www.cpfr.org/documents/ppt/VMI_vs._CPFR.ppt (VMI vs. CPFR) None Identied
Flexibility Costs
Asset Management
4.1.31
SCOR
Wave Picking
Wave picking is a practice used in many DC operations to increase labor picking productivity and reduce the labor cost per pick. In some DCs, orders are scheduled to be picked when they are received. In contrast to that, Wave picking consolidates orders into waves where multiple orders with similar characteristics are picked at one time. Orders can be consolidated by customer, geography, or any other criteria that makes sense for the DC operation. In an operation where freight consolidation for shipping is important, wave picking can help consolidate less-than-truckload (LTL) shipments into truckload (TL) shipments. Many times wave picking is performed in conjunction with batch picking. Batch picking aggregates similar items across orders into a single pick. For example, assume that the DC has 15 orders each containing Item A. In a single order pick environment, the order picker would make 15 separate trips to the location containing Item A. In batch picking, the order picker would make 1 trip to the location of Item A and pick 15 units. Most wave picking attempts begin with small batch picking initiatives. The combination of batch and wave picking provides the most productivity. Wave picking, in conjunction with batch picking, increases the total travel time for each order picker, but the total time per item picked is reduced. This also allows the DC more exibility when scheduling its order picking crew. If multiple waves are picked during the day, care must be taken to balance the number of orders across each wave as equally as possible. Waves can be planned based upon the estimated time required to complete the wave. For example, if picker productivity is 120 units per hour and the shift consists of 10 pickers, the system can release work in 1 hour blocks to make management more ecient. This makes the operation more predictable and measurable. Wave picking increases DC picking and shipping productivity substantially. If managed appropriately, customers should receive more consistent deliveries. Wave picking SCOR Process(es)
D1.9 (Pick Product)

Best Practice Need and Suitability Indicators Low distribution center (DC) labor productivity High DC order pick costs High transportation costs Ideally suited for environments where many customers place large numbers of similar orders. Demand is fairly stable throughout the operating period (also be used where seasonality temporarily increases volume in a DC). Not too practical in a pallet pick environment Works best with single line orders with the same SKU going to multiple customers. Frequently seen in the retail sector where a single DC has many shipping locations, each receiving a similar product mix. Automated picking and conveyor systems make this practice more ecient. Additional Comments Waves must match the business environment for which they are being planned. Direct-to-consumer businesses might schedule waves specic to days of delivery or might have a clean-up wave to catch all next day orders not waved throughout the day.
4.1.32
SCOR
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Experienced Impact Wave picking can increase perfect order fulllment since there are fewer opportunities to mis-pick product. Delivery times to customer might increase (consolidation of orders into waves requires holding them for a period of time before they are picked). Increases, because a wide range of specic end-products can be derived from the stocked generic product. None (except from economies of scale, see additional comment) A lower safety stock level (without eect on ll rate) reduces xed assets. Ecient wave picking requires some type of Warehouse Management System (WMS) software to prioritize orders and allocate them to an appropriate wave. This practice also requires some type of interface with the rms order management system and its Transportation Management System (TMS). Batch picking is best accomplished with an integrated sortation device that takes the results of the batch pick and creates individual orders. This is more costly from a capital investment perspective but greatly reduces operating cost and increases the consistency of throughput. Other Success Factors Acceptable lead times must be dened between the DC and its customers. This will facilitate the allocation of orders into waves. Training of DC workers is necessary to implement the wave picking process. Also, training will be required for sortation as a result of the batch picking process. Most implementations begin with a small group of customers or geographic locations. Normally, these groups should provide some level of stable demand. Additional Resources None Identied
Flexibility Costs Asset Management Technology Features
4.1.33
SCOR
Best Practice
ABC Classication Ability to Track Component/ Sub-Component Manufacturing Country of Origin Accurate and Approved Process Plans, Routings, Specications and Procedures Accurate and Approved Process Plans/Specications Accurate and Approved Work Instructions/Process Plans Accurate and Low Cost Batch Records for Regulatory Compliance Accurate and Low Cost Batch/Conguration Records for Warranty and Regulatory Tracking
Denition
None identied Component/lot tracking (lot traceability)
Process
EP.7: Manage Planning Conguration ES.8: Manage Import/Export Requirements ED.8: Manage Import/Export Requirements M1.4: Package
Electronic document management
Electronic document management
M2.3: Produce and Test M1.3: Produce and Test M2.4: Package M1: Make-to-stock M2: Make-to- Order M1.6: Release Product to Deliver M2.6: Release Finished Product to Deliver M3.7: Release Product to Deliver M1.4: Package M1: Make-to-stock M2: Make-to- Order M1.3: Produce and Test M2.3: Produce and Test M2.4: Package M3.2: Schedule Production Activities M2.1: Schedule Production Activities M1.1: Schedule Production Activities P5.3: Balance Return Resources with Return Requirements S1.1: Schedule Product Deliveries 3: Schedule Product Deliveries S2.1: Schedule Product Deliveries SR3.5: Return Excess Product SR2.5: Return MRO Product SR1.5: Return Defective Product
Electronic document management that maintains current Standard Operating Procedures (SOP) Electronic batch records
Electronic batch recording/conguration
Additional Capacity for Overow Demand
Outsource manufacturing and work force augmentation providers connected to production schedules via the internet. Advanced math model solvers that optimize / minimize constraints, routing, restocking priorities and costs. Blanket order support with scheduling interfaces to external supplier systems
Advance Planning Engines Applied to Returns Advanced Ship Notices Allow for Tight Synchronization between Source and Make Processes Advanced Shipping Notice
Integrated data sharing with repair facility.
4.1.34
SCOR
Best Practice
Advanced Shipping Notices & UCC128 Container Labeling
Denition
Bar coding; EDI; integrated transportation/warehouse management
Process
D3.13: Receive and Verify Product by Customer D1.13: Receive and Verify Product by Customer D1.11: Load Vehicle & Generate Shipping Docs D2.11: Load Product & Generate Shipping Documentation D3.11: Load Product & Generate Shipping Documents D2.13: Receive and Verify Product by Customer EP.5: Manage Integrated Supply Chain Capital Assets EP.6: Manage Integrated Supply Chain Transportation P1: Plan Supply Chain
Alignment of Strategic and Business Plans with LongTerm Capacity and Resource Planning All Functions and Organizations Understand Their Impact on Supply/ Demand Balancing, Including Sales, Marketing, Product Management, Manufacturing, Customer, Suppliers, Materials Management, and Product Development All Key Participants in the Supply Chain, Including Strategic Partners, Have Full Visibility of the Demand/ Supply Plan Allow Source Suppliers Full Visibility into the Current Return Situations and the Forecasted Return Activity Appointment Scheduling for Pickup and Delivery of Customer Shipments Arrange for Shipping Insurance in Case Of InTransit Loss or Damage Assessing Export/Import Requirements during Time of Product Development/ Manufacture Attribute-Based Process Planning
None identied
None identied
Supply Chain Event Management Systems
P2: Plan Source
Shared supply chain forecasting and event management functionality with Source suppliers Transportation Management System (TMS) Maintenance Management Preventative management
P5.2: Identify, Assess, and Aggregate Return Resources
ED.6: Manage Transportation ES.6: Manage Incoming Product ER.6: Manage Return Transportation SR3.4: Schedule Excess Product Shipment ES.8: Manage Import/Export Requirements (Source) ED.8: Manage Import/Export Requirements EM.1: Manage Production Rules
Multi-country Export/Import documentation compliance
Computer aided process planning / recipe management
4.1.35
SCOR
Best Practice
Authorize Each Operation to Assess the Quality of the Previous Operations Automated Conguration Management Automated Conformance Monitoring And Control Automated Conversion of Engineering Drawings into Product Specications Automated Data Entry Automated Directed Picking
Denition
None identied
Process
M3.4: Produce and Test M2.3: Produce and Test M1.3: Produce and Test D2.2: Receive, Congure, Enter and Validate Order M3.1: Finalize Production Engineering EM.8: Manage Make Regulatory Environment M3.1: Finalize Production Engineering
Conguration
Internal automatic notication of conformance, including holding of product until requirements are met None identied
Scanning with RFID/Bar-codes systems A pick list displayed on a handheld device that directs picks and relieves inventory from backroom locations Advanced planning and scheduling capability coupled with decision support logic. Transportation Management System (TMS) Maintenance Management Automated Intelligence (Heuristic) based engineering specications system Automated inventory planning package linked to real time demand data and inventory business rules.
ER.5: Manage Return Capital Assets ED.5: Manage Deliver Capital Assets D4.3: Pick Product from Backroom
Automated Disposition Instructions for Returns Based on Data Interchange with Strategic Providers Automated Documentation for International Shipments Automated Engineering Specications Automated Inventory Visibility and Planning System to Highlight Inventory in Excess of Requirements Automated Links To Existing CAD & CAM Information Automated Notication of Laboratory Regarding Sample Availability Automated Pick List
ER.5: Manage Return Capital Assets
ER.6: Manage Return Transportation ES.6: Manage Incoming Product ED.6: Manage Transportation EM.1: Manage Production Rules SR3.1: Identify Excess Product Condition
Electronic hypertext or links to existing database of detail/parts/setup sketches/ drawings Interface between production system and LIMS
M1.6: Release Product to Deliver M2.6: Release Finished Product to Deliver M3.7: Release Product to Deliver D4.2: Receive Product at the Store D4.1: Generate Stocking Schedule
System generated pick-lists based on picking / batching rules.
4.1.36
SCOR
Best Practice
Automated Registry of Inventory Return Locations by Item to Speed Identication of Proper Return Location Automated Replenishment of Back Stock Based on Minimum Stocking Levels Automated Statistical Process Control (SPC) Automated Update of Customer Excess Material Return Transaction History
Denition
None identied
Process
SR3.2: Disposition Excess Product
None identied
None identied - Use trend analysis to inuence inventory level decisions. - Web-based alerts to identify update occurred and when pre-determined thresholds are exceeded. None identied
S2: Source Make-to-Order Product ER.3: Manage Return Data Collection
Automated Update of Supplier Performance Information Automatic Customer Payment Automatic Generation / Conguration Of Tooling / Set-Up Instructions Automatic Generation And Submission Of Conformance Documents Automatic Identication
ES.3: Maintain Source Data
RFID, smart cart or customer self-service charges goods to card upon store departure. Parametric driven (Group Technology based) manufacturing design system Software specic to industry regulations and standards (e.g. may be software to produce MSDS documents, or FDA requirements, etc.) Bar Coding & Radio Frequency Communications
D4.6: Checkout
2.8: Receive Product from Source or Make D3.8: Receive Product from Source or Make D1.8: Receive Product from Source or Make M2.4: Package M1.4: Package M3.5: Package EM.1: Manage Production Rules
Automatic Label and Seal Verication Automatic Link to Recipe Management, PLC Program, CNC Program Systems, Etc., to Deliver New Manufacturing Documentation
Automatic interface to inspection systems Seamless application interface to manufacturing planning documentation and CAM systems
4.1.37
SCOR
Best Practice
Automatic Multi-level Credit Checking: Dollar Limits; Days Sales Outstanding; Margin Testing Automatic Notication When to Begin and When to Complete Automatic Reservation of Inventory and Dynamic Sourcing of Product for Single Shipment to Customer Available-to-Promise (ATP)
Denition
Integrated Order/Financial Management
Process
D1.2: Receive, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order EM.1: Manage Production Rules
Workow/Groupware
Integrated order management system that treats each order line as a separate order with integration to inventory source and status; Real-time inventory management See detailed description in beginning of this chapter
D1.3: Reserve Inventory and Determine Delivery Date D2.3: Reserve Inventory and Determine Delivery Date D1.3: Reserve Inventory and Determine Delivery Date D2.3: Reserve Inventory and Determine Delivery Date M1.2: Issue Material M3.3: Issue Sourced/In-Process Product M2.2: Issue Sourced/In-Process Product ER.6: Manage Return Transportation ES.6: Manage Incoming Product ED.6: Manage Transportation S3.5: Verify Product S2.2: Receive Product S1.3: Verify Product DR3.3: Receive Excess Product S1.2: Receive Product DR1.3: Receive Defective Product S2.3: Verify Product DR2.3: Receive MRO Product S3.4: Receive Product P2.4: Establish Sourcing Plans D1.5: Build Loads D2.5: Build Loads D3.5: Build Loads M3.2: Schedule Production Activities
Back Flush Material at Order Completion
Flexible back ush logic
Backhaul Trading Exchange
Pooling
Bar Coding is Used to Minimize Handling Time and Maximize Data Accuracy
- Bar code interface for data collection devices.- Generate bar coded receiving documents.- Product serial number used as identier.- RFID
Blanket Purchase Orders Cover Period Requirements Build Load in Stop Sequence
None identied Integrated inbound/outbound transportation planning (i.e. 1st truck destination loaded last, etc.). None identied
Build Subassemblies to Forecast at Highest Generic Level in Bill of Material; Maintain Flexibility While Minimizing Cycle Time and Inventory Position
4.1.38
SCOR
Best Practice
Build Subassemblies/ Products to Forecast at Highest Generic Level to Minimize Make Cycle Time Business Intelligence (BI)
Denition
None identied
Process
M2: Make-to- Order
A data warehouse / data mart is the source of all planning (master) data, business rules and transaction data. Analytical tools enable the ongoing maintenance and improvement of the business rules based on actual data. Convenient availability to business rules and return criteria. Supply chain modeling and visualization system
Business Rules Are Clearly Communicated with the Customer Capability to Run Simulated Full-Stream Supply/Demand Balancing for What-If Scenarios Capability to Run Multiple Simulated Full-Stream Supply/Demand Balancing Against Long-Term Capacity Plans and Scenarios Capability Transfer to Customer Capability Transfer to Organization Capacity and Supply Constraints Are Balanced Against Demand during the Planning Cycle Capture and Maintain Mode Specic Data Carrier Agreement
ER.2: Manage Performance of Return Processes P1: Plan Supply Chain EP.6: Manage Integrated Supply Chain Transportation EP.5: Manage Integrated Supply Chain Capital Assets EP.4: Manage Integrated Supply Chain Inventory S2.4: Transfer Product S1.4: Transfer Product S3.6: Transfer Product P2.2: Identify, Assess and Aggregate Product Resources P2.1: Identify, Prioritize and Aggregate Product Requirements ES.6: Manage Incoming Product ER.6: Manage Return Transportation ED.6: Manage Transportation S3.4: Receive Product D1.11: Load Vehicle & Generate Shipping Docs ES.2: Assess Supplier Performance ES.7: Manage Supplier Network D3.11: Load Product & Generate Shipping Documents ES.10: Manage Supplier Agreements S1.2: Receive Product D2.11: Load Product & Generate Shipping Documentation
Supply Chain modeling capabilities, i.e. Advanced Planning Systems.
None identied None identied None identied
Transportation Management System (TMS) Maintenance Management See detailed description in beginning of this chapter
4.1.39
SCOR
Best Practice
Carrier Selection Based on Performance Criteria at Least Cost
Denition
Scheduling, carrier selection, and rating
Process
SR2.4: Schedule MRO Shipment SR3.4: Schedule Excess Product Shipment SR1.4: Schedule Defective Product Shipment D2.6: Route Shipments D3.6: Route Shipments D1.6: Route Shipments P2.1: Identify, Prioritize and Aggregate Product Requirements P2.2: Identify, Assess and Aggregate Product Resources M2: Make-to- Order M3.2: Schedule Production Activities M3: Engineer-to-Order M1: Make-to-stock P1: Plan Supply Chain
Carrier/Route Optimization Based on Continuous Movement and Consolidation/Pooling Categorize 100% of Total Inventory (Active, Usable, Excess, Obsolete) for Appropriate Action Cellular and Demand Pull Manufacturing Cellular Manufacturing
Route scheduling, carrier selection, and rating
None identied
Support for cellular and demand pull manufacturing execution Manufacturing is broken into work cells
Change in the Demand Signal Instantaneously Recongures the Production and Supply Plans Changeover Reduction / Continuous Improvement Program
Event-driven supply chain re-planning
Changeover process ow element identication, instructional directions to conduct changeover, and measurement tool, which can be used to prioritize and track results of improvement eorts. Software to identify operational constraints to the MAKE processes to assist in directing resources toward bottleneck functional areas. Overseas packaging, labeling and shipping regulatory requirements are given specic attention. Participants at all customer and service provider locations involved clearly understand all regulatory requirements at each step in the return process .
ES.5: Manage Capital Assets EM.5: Manage Make Equipment and Facilities
Clarify in Advance Hazardous Material Packaging, Labeling and Shipping Requirements Clarify in Advance If the Product to be Returned Requires Specic, Formal Authorization from the Service Provider per Federal, State or Local Regulation, Prior to Returning
ER.8: Manage Return Regulatory Requirements and Compliance
4.1.40
SCOR
Best Practice
Clarify Point of Contact and Return Location
Denition
Electronic rules for business relationships and transactions.
Process
SR3.3: Request Excess Product Return Authorization SR1.3: Request Defective Product Return Authorization P1.1: Identify, Prioritize and Aggregate SC Requirements P1.4: Establish & Communicate Supply-Chain Plans
Collaboration among Operations Strategy Team
Supply Chain Advanced Planning Systems, Supply Chain Integration Systems, Integration between supply chain advanced planning and ERP execution systems, Supply Chain Capacity Planning Systems See detailed description in beginning of this chapter Interactive, on-line planning/scheduling systems. Capacity planning systems with accurate production capability data. Web based access to current spend data available from enterprise to part level
Collaborative Planning, Forecasting, Replenishment (CPFR) Collaborative Planning/ Scheduling Collaborative Review and Agreement of Business Rules Prior to Contract Execution Combine Consolidation Needs with Other Products/ Divisions/Companies Communicate with Customer before the Return to Establish What Types of Returns Are Acceptable<!> Comparative Analysis of Supplier Performance is Used in Sourcing Decisions Compare Local Customs Requirements to Your Process Procedures to Ensure All Requirements Are Accounted for Before Shipping Complete Lot History
P1: Plan Supply Chain
ES.1: Manage Sourcing Business Rules
None identied
D1.4: Consolidate Orders
None identied
DR1.1: Authorize Defective Product Return DR3.1: Authorize Excess Product Return DR2.1: Authorize MRO Product Return ES.2: Assess Supplier Performance
Software application with data analysis capability None Identied
Inventory by lot of sourced/in-process or discrete order /usage reporting by lot or discrete order None identied
M2.2: Issue Sourced/In-Process Product M1.2: Issue Material ED.3: Manage Deliver Information
Comprehensive History of Customer Interactions Including Order History, Claims, Problems, Etc.
4.1.41
SCOR
Best Practice
Concurrent Engineering is Used to Tightly Link Sourcing into the Product Development Process Make/Buy Decision Process (Outsourcing vs. In Sourcing) Conrm All Documentation and Inspection Requirements Before Shipping Conrm Asset Return Condition Codes Are Clearly Understood by All Employees, Especially Those Who Are New to the Process Conrm Changes in Condition Code Policies Are Promptly Communicated to All Employees and SupplyChain Partners. Consideration of Suppliers Material Availability in Companys Supply Resources (Including Suppliers Production Plans & Capability, Inventory, and Delivery Plans) Consignment Agreements Are Used to Reduce Assets and Cycle Time While Increasing the Availability of Critical Items Consolidate Orders by Customer, Source, Trac Lane, Carrier, Etc. Consolidate Shipments Through Cross Docking - Coordinate with Other Shipments Consolidation of Carriers
Denition
None identied
Process
None Identied
None identied
SR1.2: Disposition Defective Product
None identied
SR1.2: Disposition Defective Product
Digital linkage to supplier quoting, planning, conguration and customer service applications
Consignment inventory management
S3.3: Schedule Product Deliveries S2.1: Schedule Product Deliveries S1.1: Schedule Product Deliveries
Integrated load planning and building with warehouse management None Identied
D1.4: Consolidate Orders D2.4: Consolidate Orders ER.6: Manage Return Transportation
Transportation modeling and rate analysis Integrated inbound/outbound transportation planning
D2.6: Route Shipments D3.6: Route Shipments D1.6: Route Shipments D2.5: Build Loads D1.5: Build Loads D3.5: Build Loads
Consolidation of Inbound and Outbound Requirements
4.1.42
SCOR
Best Practice
Consolidation of Return Carriers
Denition
Outbound logistics software to assist with route.
Process
SR3.4: Schedule Excess Product Shipment SR1.4: Schedule Defective Product Shipment SR2.4: Schedule MRO Shipment EM.3: Manage Make Information
Continuous Improvement
Historical trending, cause and eect analysis, and Key Performance Indicators Scheduling reviews of processes for possible improvements None identied
Continuous Improvement and Development is Driven and Measured through the Performance Review Process Continuous Improvement is Planned through Process Reviews and Customer Feedback Continuous Replenishment Programs; Vendor Managed Inventory, Telemetry to Automatically Communicate Replenishment of Chemicals Cost Accounting System to Determine the Best Return Process to Follow from a Cost of Business Perspective Cost Reduction and or Cost Avoidance Are Opportunities Are Identied, Implemented and Measured on a Periodic Basis Create and Maintain Multiple Suppliers and Multiple Supplier Sites to Record Information about Individuals and Companies from Whom You Want to Purchase Catalogue Goods and Services Cross Training/Certication
Avenue to receive customer comments.
Integrated demand/deployment planning to customer location driven by POS; Customer movement data
D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order P5.3: Balance Return Resources with Return Requirements
ABC costing system
None identied
None Identied
ES.7: Manage Supplier Network
HR/certication support
M3.2: Schedule Production Activities M2.1: Schedule Production Activities M1.1: Schedule Production Activities
4.1.43
SCOR
Best Practice
Cross-Docking
Denition
See detailed description in beginning of this chapter
Process
D3.11: Load Product & Generate Shipping Documents D1.8: Receive Product from Source or Make D2.11: Load Product & Generate Shipping Documentation D3.8: Receive Product from Source or Make D3.12: Ship Product D2.8: Receive Product from Source or Make D1.12: Ship Product D1.11: Load Vehicle & Generate Shipping Docs D2.12: Ship Product D3.5: Build Loads D1.5: Build Loads D2.5: Build Loads D2.6: Route Shipments D3.6: Route Shipments D1.6: Route Shipments ED.3: Manage Deliver Information
CRP & VMI Loads Optimized for Utilization CRP/VMI
Integration with CRP/VMI vendor systems Integrated Load Building; Routing & Scheduling with Advanced Ship Notice (ASN) Internet-enabled package/shipment tracking WEB based Shared systems None identied Tightly integrated supply chain or demand planning with point of sale and customer inventory systems
Customer Access to Online Tracking of Order Status and Shipping Information Customer Initiated Package Tracking Customer Prole Drive Recognition Upon Checkout Customer Relationship and Digital Linkages (XML, EDI, Etc.) Provide Accurate Visibility into Actual Demand via Customer Forecasts, Product Plans, Production Plans, and Inventory Positions Customer Relationship Management (CRM)
ED.2: Assess Delivery Performance D4.6: Checkout P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Software that provides customer input and keeps the customer informed about the planning of the production and delivery process by managing all contacts and communication with the customer thorough all channels including internet and traditional sales and customer service channels.
4.1.44
SCOR
Best Practice
Customer Sends Receiving Advanced Shipment Notication Prior to Shipment Customer Service Data Validation Including GeoCoding Data Accessibility across the Enterprise for Visibility by Discrete Business Units Defective Products Scheduling Identies Next Destination (Source, Make, or Deliver) on Return Authorization Dened Stocking Levels and Criteria Deliveries Are Balanced Throughout Each Working Day and Throughout the Week
Denition
Electronically link Return authorization, Return schedule and shipping documents. . None identied
Process
DR2.3: Receive MRO Product DR1.3: Receive Defective Product DR3.3: Receive Excess Product ED.3: Manage Deliver Information
Web based access to various levels of enterprise data Utilize electronic links
ES.3: Maintain Source Data ER.3: Manage Return Data Collection DR1.4: Transfer Defective Product
None identied None identied
D4.3: Pick Product from Backroom S1.2: Receive Product S2.3: Verify Product S1.3: Verify Product S3.4: Receive Product S3.5: Verify Product S2.2: Receive Product M2: Make-to- Order M3: Engineer-to-Order P1.3: Balance Supply Chain Resources with SC Requirements
Delivery Schedules Are Collaboratively Developed with Customers Demand Planning, Demand Flow Leadership
Web-based access to plant scheduling status, collaborative data-sharing environment. Software that provides multiple data models including the business rules and metrics for the entire supply chain planning process. Algorithms use the business rules and metrics as the drivers for the planning engine. Rules-based distribution planning system. Trading partner agreements
Demand Priorities Reecting Strategic Customer Relationships as Business Policies Are Automatically Followed in Allocating Resources; First-In-FirstOut (FIFO) is Utilized as the Default Scheduling Priority Demand Pull Mechanisms
P4.3: Balance Delivery Resources and Capabilities with Delivery Requirements
Repetitive scheduling and sequencing
M2.1: Schedule Production Activities M3.2: Schedule Production Activities
4.1.45
SCOR
Best Practice
Demand-Pull Manufacturing, Including Active Reduction of Manufacturing Systems Time and WIP Through the Use of Demand-Pull Mechanisms and Visual Controls Demand-Pull Mechanisms; Kanban Replenishment Signals from Stockroom, Intermediate Products, or Subassembly Area Design For Production
Denition
Support of demand-pull mechanisms (Kanban, replenishment signals, etc.) based on rate schedules and userdened minimum/maximum trigger points
Process
M2.1: Schedule Production Activities M1.1: Schedule Production Activities M3: Engineer-to-Order M1: Make-to-stock
None identied
M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product M1.2: Issue Material EM.1: Manage Production Rules
Table of manufacturing capacities or design envelops (capacities; envelop sizes; tank, vessel or batch sizes) Machine productivity and downtime monitoring
Design/Upgrade Production Equipment to Maximize Flexibility and Avoid Line Stoppages
M2.3: Produce and Test M2.4: Package M1.3: Produce and Test M1.4: Package M3.5: Package M3.2: Schedule Production Activities M3.4: Produce and Test SR3.3: Request Excess Product Return Authorization SR1.3: Request Defective Product Return Authorization DR2.3: Receive MRO Product DR3.3: Receive Excess Product DR1.3: Receive Defective Product ER.6: Manage Return Transportation P2.4: Establish Sourcing Plans
Develop and Clarify Mutually Understood Cycle Times to Process Return Authorizations Develop Local Receiving Process Close to Repair Develop Proactive Transit Damage Programs Digital Linkage (EDI, XML, Etc.) is Used to Provide RealTime Demand Information and Handle Routine Transactions Digital Links (XML Based, EDI. Etc.) Among Supply Chain Members
Clarication as to who will pay in-bound and out-bound freight cost.
Minimize time spent in product movement. None Identied None identied
Real-time exchange of supply chain information between supply chain members collaborative planning systems, Internet Trading Exchanges, B2B Integration and Application Server Systems
P1.4: Establish & Communicate Supply-Chain Plans P1.2: Identify, Prioritize and Aggregate SC Resources P1.1: Identify, Prioritize and Aggregate SC Requirements
4.1.46
SCOR
Best Practice
Direct Connection to Customs Clearance
Denition
Process
ES.8: Manage Import/Export Requirements ED.8: Manage Import/Export Requirements M2.5: Stage Finished Product M1.5: Stage Product M3.6: Stage Finished Product ED.8: Manage Import/Export Requirements ES.8: Manage Import/Export Requirements P2: Plan Source P4: Plan Deliver P3: Plan Make
Direct Ship from Factory to Customer/Channel
Share production status with customers and transportation providers via webbased tools. Auto-Tendering for direct ship utilizing EDI/XML protocols. Electronic documentation submission via EDI and/or internet.
Direct Transfer of Documents to Recipient and Forwarder Direct Transfer of Documents to Recipient and Forwarder Distinct and Consistent Linkages Exist to Ensure Disruptions and Opportunities in Material Resources Are Quickly and Accurately Communicated and Acted Upon Document Control Documents Generated Automatically During Shipment Preparation. Download P.O. & Advanced Ship Notices for Automated Receiving and Put Away
Bi-directional Digital Links (XML, EDI, etc) or Internet procurement networks to customer service linkage Multi-plant supply/demand planning and execution
Control who can create, revise and access information Electronic documentation submission via EDI and/or internet.
EM.1: Manage Production Rules ES.8: Manage Import/Export Requirements ED.8: Manage Import/Export Requirements D1.8: Receive Product from Source or Make D3.8: Receive Product from Source or Make D2.8: Receive Product from Source or Make S1.4: Transfer Product S2.4: Transfer Product S3.6: Transfer Product SR3.2: Disposition Excess Product SR1.2: Disposition Defective Product
Integration with Procurement Systems & Electronic Commerce with Vendors
Drive Deliveries Directly to Stock or Point-Of-Use in Manufacturing to Reduce Costs and Cycle Time Drive Returns Directly to Return Stock Point of Disposition to Reduce Cost and Cycle Time Drum-Buer-Rope Scheduling Technique
Pay on receipt. Specify delivery location and time (to the minute).Specify delivery sequence Specify return disposition location and time.
M3.2: Schedule Production Activities M2.1: Schedule Production Activities M1.1: Schedule Production Activities
4.1.47
SCOR
Best Practice
Dunnage Control
Denition
System data eld to specify where the part / product shipping container should be removed. Best practice is to remove the dunnage as soon as possible unless part / product damage will result. Reuse of intermediate WIP containers for nished goods. Advanced planning and scheduling logic with constraint, cost, and resource optimization Real time inventory control, stock locator, and rules based picking logic
Process
EM.4: Manage In-Process Products
Dynamic Deployment Based on Constraint Based Planning and Optimal Scheduling Dynamic Location Assignment Including Lot Control, Zoned Picking, Quality Assurance
D3.8: Receive Product from Source or Make D3.9: Pick Product D2.9: Pick Product D2.8: Receive Product from Source or Make D1.9: Pick Product D1.8: Receive Product from Source or Make
Dynamic Location Assignment Including Lot Control, Zoned Put Away, Quality Assurance, ABC Frequency of Access Dynamic Return Restocking Management
Real time inventory control, stock locator, and rules based put away logic
Dynamic prioritization of restocking plans in order to rapidly re-sell products that are in demand thus reducing new inventory demand. Rules based picking logic and simulation
P5.3: Balance Return Resources with Return Requirements
Dynamic Simulation of Picking Requirements Optimized for Labor, Cost, and Time EDI Links between Manufacturing and Distributor to Achieve Visibility of Complete Finished Goods Inventory and Expected Shipments EDI Links Integrate Supplier Resource Information (Inventory, Capacity Availability, Etc.) with Own Resources Ecient and Eective Benchmarking Process Leveraging Cross Industry Metrics and Denitions
D3.9: Pick Product D2.9: Pick Product D1.9: Pick Product D1.3: Reserve Inventory and Determine Delivery Date
None identied
Inter-company resource planning with EDI/Internet communication
P2: Plan Source
None identied
4.1.48
SCOR
Best Practice
Ecient Consumer Response (ECR); Quick Response Electronic Catalogues/Malls Electronic Commerce (Customer Visibility of Stock Availability, Use of HandHeld Terminals for Direct Order Entry, Conrmation, Credit Approval), OnLine Stock Check and Reservation of Inventory Electronic data collection ofcompletion, quality, lot trace ability, scrap, and labor data Electronic Data Interchange Can Be Used To Send Rfqs and Technical Information to and from Potential Suppliers to Determine Supplier Capability to Fulll Requirements So that They May Be Added to Supplier Network Electronic Data Interchange is Used to Send Technical Information to and from Potential Suppliers Electronic Documentation and Imaging Electronic Generation and Download of Shipping Documents
Denition
Demand Planning, Deployment, Scheduling None identied EDI applications and integrated order management
Process
D1: Deliver Stocked Products
D1: Deliver Stocked Products D1.2: Receive, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order
Reduce non-value added paperwork while still maintaining process metrics
M3.5: Package
Electronic Data Interchange
ES.7: Manage Supplier Network S3.2: Select Final Supplier (S) and Negotiate
None identied
Graphical display of drawings, diagrams, recipes/formulas, specications, instructions, etc., to all users None identied
D2.11: Load Product & Generate Shipping Documentation D1.11: Load Vehicle & Generate Shipping Docs D3.11: Load Product & Generate Shipping Documents ER.6: Manage Return Transportation ES.6: Manage Incoming Product ED.6: Manage Transportation P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Electronic Manifest and Electronic Billing Electronic Matching Between POS Data and Store Inventory (Shelves and Back Room)
Transportation Management System (TMS) Maintenance Management Integrated Software Systems
4.1.49
SCOR
Best Practice
Electronic Material Move Transactions
Denition
Automated process control and/or barcode data collection
Process
M3.3: Issue Sourced/In-Process Product M2.2: Issue Sourced/In-Process Product M3.6: Stage Finished Product M1.2: Issue Material M2.5: Stage Finished Product M1.5: Stage Product ER.1: Manage Business Rules for Return Processes ES.10: Manage Supplier Agreements ES.1: Manage Sourcing Business Rules D3.15: Invoice D2.15: Invoice D1.15: Invoice DR1.3: Receive Defective Product DR3.3: Receive Excess Product DR2.3: Receive MRO Product P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Electronic Reminders of Possible Scheduled Maintenance Electronic Sourcing and Negotiation Electronic Transfer of Shipment Information to Finance Electronically Track Shipment from Customer to Service Provider Eliminate Special Deals Sales to Reduce Returns and Improve Forecast Accuracy (Reduces Uncertainty, Lowers Safety Stock Requirements, Cheaper to Administer) Enable Customer-Service Representatives to Complete the Bill Of Lading for the Customer Including Carrier Routing, Weight, Description and Class to Minimize Guesswork & Wrong Estimates Enable Real-Time Visibility into Backlog, Order Status, Shipments, Scheduled Material Receipts, Customer Credit History, and Current Inventory Positions Enterprise Level Policies/ Rules with Local Execution
Pull signals.
Business Rules for electronic sourcing process and hierarchy None identied
None Identied
None identied
Clarication of policy if authorizations are not processed within the expected cycle time.
SR1.3: Request Defective Product Return Authorization SR3.3: Request Excess Product Return Authorization
None identied
D1.2: Receive, Enter and Validate Order D2.2: Receive, Congure, Enter and Validate Order
Web based access to enterprise level business rules
SR3.1: Identify Excess Product Condition SR1.1: Identify Defective Product Condition ES.10: Manage Supplier Agreements ES.1: Manage Sourcing Business Rules
4.1.50
SCOR
Best Practice
Enterprise Level Spend Analysis Establish Designated Processes for Scheduling and Receiving Excess Inventory Establishment of Criteria to Rank Suppliers Evaluate Supplier Network for Duplicates Evaluate the Benets of OutSourcing the Excess Material Return Process Excess Products Scheduling Identies Next Destination (Source, Make, or Deliver) on Return Authorization Facility & Equipment Environmental / Safety Audit System Facility Master Plan Factory Floor Electronic Decision Making Information System
Denition
None identied None Identied
Process
ES.10: Manage Supplier Agreements ES.1: Manage Sourcing Business Rules DR3.2: Schedule Excess Return Receipt
Utilize supplier delivery, quality, price performance as well as any other criteria such as terms and conditions Supplier Merge Programs for duplicates Enables customer to focus on core competencies. Utilize electronic links
ES.7: Manage Supplier Network ER.1: Manage Business Rules for Return Processes DR3.4: Transfer Excess Product
System software to list checklist items, report results of audit & forward actions to be taken Automated Item Cubing and Weighting systems Software to capture actual performance history / costs of operations with capability of predicting best cost action plans relating to maintaining equipment and facilities. Part / WIP location by date received for those parts that must be stocked or staged in a holding area B2B Integration and Application Server Systems
EM.5: Manage Make Equipment and Facilities ES.5: Manage Capital Assets ED.5: Manage Deliver Capital Assets EM.5: Manage Make Equipment and Facilities
First In - First Out
M.4: Manage In-Process Products (WIP) P4.1: Identify, Prioritize and Aggregate Delivery Requirements
Forecasts Are Replaced with Actual Customer Replenishment Signals and Orders Where Possible Full Internal (And External If Source Suppliers Share in the Return Process Responsibilities) Visibility to Return Plans
Intranet and Extranet communications tools
4.1.51
SCOR
Best Practice
Full Visibility of Credit History by Shipping Personnel
Denition
None identied
Process
D3.11: Load Product & Generate Shipping Documents D1.11: Load Vehicle & Generate Shipping Docs D2.11: Load Product & Generate Shipping Documentation EM.1: Manage Production Rules D4.7: Deliver and/or Install P4.1: Identify, Prioritize and Aggregate Delivery Requirements ES.7: Manage Supplier Network
Genealogy Tracking Goals / Performance Plans Ideal Stock Position Based on Days/Weeks of Supply Identication of Suppliers Who Will Participate in Kanban Programs Identication of Suppliers Who Will Participate in Procurement Split (Two or More Suppliers Sharing Purchase Requirements) Programs Identication of Suppliers Who Will Participate in Vendor Managed Inventory (VMI) Programs Implement Employee Involvement Programs Incorporates leading practices such as Ecient Consumer Response, Collaborative Planning, Forecasting, and Replenishment, Vendor Managed Inventory, and real time point of consumption reporting. In-Process Product (WIP) Handling Rules Integrate Return Planning with Maintenance and Inventory Planning to Optimize the System
Where-used listing of as-planned vs. asbuilt documentation None identied Pilot by Wal-Mart. IT Electronic Kanban Support
None identied
Supplier managed inventories with scheduling interfaces to external supplier systems to replenish None Identied None Identied
M3.4: Produce and Test EP.7: Manage Planning Conguration
Tracking, genealogy Both customer and Service Provider departments are alerted at the same time and viewing the same information.
EM.4: Manage In-Process Products (WIP) DR2.2: Schedule MRO Return Receipt DR1.2: Schedule Defective Return Receipt
4.1.52
SCOR
Best Practice
Integrated Business and Supply-Chain Planning Processes Where CrossFunctional Input is Leveraged to Set Business Rules Integrated Credit Checking
Denition
Supply Chain performance dashboard capability.
Process
EP.1: Manage Business Rules for Plan Processes
Interface to suppliers shipping system to nancials
D2.11: Load Product & Generate Shipping Documentation D1.11: Load Vehicle & Generate Shipping Docs D3.11: Load Product & Generate Shipping Documents EP.3: Manage Plan Data Collection
Integrated Demand and Supply Planning - Demand Planning, Supply Planning and especially the Supply Plan Execution Are no longer disconnected. All required planning and execution data is integrated and shared in between all functional areas within an organization. Integrated Edit at Order Entry Time Integrated Facility Management Integrated Order Management, Warehouse Management, and Transportation Management Systems View for analysis for all orders and shipments the following data: Logistics, Product, Cost, GL Charging Integrated Transportation Visibility Internet Exchanges
Memory based planning systems provide one single data model and data mart (including the business rules) for the entire supply chain planning and execution process. Algorithms use the business rules as the driver for the planning engine.
Customer Master Record None identied Transportation Management System (TMS) Maintenance Management
ED.1: Manage Deliver Business Rules ED.7: Manage Product Life Cycle ES.6: Manage Incoming Product ED.6: Manage Transportation ER.6: Manage Return Transportation
- Advanced shipping notices - Real time shipping tracking Internet Exchanges are a hosted, business-to-business trading network. Exchanges are an open procurement network, accessible to any buyer and focused on new Internet-enabled purchasing models like spot buys or reverse, buyer-driven auctions. Exchanges will also support more traditional catalog-based sales.
ER.5: Manage Return Capital Assets ES.7: Manage Supplier Network
4.1.53
SCOR
Best Practice
Internet Ordering Internet Pooling (Electronic brokerage of shipments) Inventory Allocation Exception Process is Clearly Dened and Jointly Owned by Manufacturing and Sales Inventory is Planned at the Part Level, Based on Supply and Demand Variability Inventory Performance is Measured at the Dollar and Unit Levels Inventory targets Are Reviewed and Adjusted Frequently
Denition
None identied Internet Pooling (Electronic brokerage of shipments None identied
Process
D1: Deliver Stocked Products ED.6: Manage Transportation ER.6: Manage Return Transportation ES.6: Manage Incoming Product D1.3: Reserve Inventory and Determine Delivery Date
None identied
P2.2: Identify, Assess and Aggregate Product Resources P2.2: Identify, Assess and Aggregate Product Resources P3.3: Balance Production Resources with Production Requirements P3.2: Identify, Assess and Aggregate Production Resources P2.2: Identify, Assess and Aggregate Product Resources R.6: Manage Return Transportation
None identied
Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query inventory levels.
Involve Your Other SupplyChain Partners If Possible to Leverage Transportation throughout the Chain Item/Shelf Scanning Upon Put-A-Way Items Are Relieved from Inventory When Item is Removed from Shelf JIT Environment
Utilization of transportation management system (TMS) to manage returns. Maximization of TMS use, both intra and inter-company within the supply chain. Scan store shelves / bar codes to conrm put-a-way. RFID, smart cart or customer self-service reduces system inventory upon item pick. Schedule visibility, on-line communications between source and demand Collaborative Planning Systems
D4.4: Stock Shelf D4.5: Fill Shopping Cart
Joint Service Agreements (JSA)
S2: Source Make-to-Order Product P1.2: Identify, Prioritize and Aggregate SC Resources S3: Source Engineer-to-Order Product S1: Source Stocked Product P1.4: Establish & Communicate Supply-Chain Plans P1.1: Identify, Prioritize and Aggregate SC Requirements
4.1.54
SCOR
Best Practice
Joint Service Agreements to Document Acceptable Service Levels in Terms of Installation Costs, Installation Cycle Time, Etc. Joint Service Agreements with Source Suppliers to Share Responsibilities and Costs of Returns Joint Service Agreements with Suppliers Dene the Levels of Flexibility or Resource Upside Available Within Stated Lead Times and Agreed Upon Conditions Just-In-Time Demand Flow Techniques Labor Scheduling that Matches Product Flow Lead Times Updated Monthly Lean Manufacturing
Denition
Collaborative planning tools with the Source suppliers.(This would be eective between customer and supplier, and between internal functions such as Field Service, Manufacturing, Marketing and Order Management) Collaborative planning tools with the Source suppliers
Process
D2.14: Install Product D1.14: Install Product
None identied
P2: Plan Source
Demand-pull mechanisms
M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test D4.1: Generate Stocking Schedule D4.2: Receive Product at the Store P1.2: Identify, Prioritize and Aggregate SC Resources M1: Make-to-stock
Workforce management solution with exible rules. None identied Use a team based systematic approach to identifying and eliminating wasteful, or non-value adding activities within your manufacturing organization Utilization of transportation management system (TMS) to manage returns. Maximization of TMS use, both intra and inter-company within the supply chain.
Limit the Number of Carriers, Treat Them as Partners and Build a Strong Relationship with Each One Geared Toward Continually Improving Service and Lowering Cost Link Individual Performance to Organizational and Divisional Goals Long Term Supplier Agreements/Partnerships
None identied
M2: Make-to- Order M1: Make-to-stock M3.4: Produce and Test ES.10: Manage Supplier Agreements ES.1: Manage Sourcing Business Rules
Electronic rules for business relationships and transactions: Vendormanaged Inventory Agreements, Fab & Hold Agreements, Just-In-Time Agreements.
4.1.55
SCOR
Best Practice
Long-Term Return Agreements / Partnerships
Denition
None identied
Process
SR1.3: Request Defective Product Return Authorization SR3.3: Request Excess Product Return Authorization D4.5: Fill Shopping Cart M2.3: Produce and Test M3.4: Produce and Test M1.3: Produce and Test M1.1: Schedule Production Activities M2.1: Schedule Production Activities
Loyalty Card Data Maintain Accurate Lot/Batch History Information Maintain Data and System Integrity by Ensuring Production Data, Inventory Levels, and Schedule Requirements Are 99+% Accurate Maintaining Repository of Current Regulatory Requirements Manage Information Across 100% of Shipments Master Production Scheduling Reects Management of Capacity and/or Supply Constraints Matching Shelf Stock to Expectations
Use for comparison to previous sales activity/track new consumers, etc. Electronic data collection of employee actions and sourced/in-process product lot used Detailed production model that synchronizes PLAN and MAKE activities in real time.
Electronic subscription and publication of conformance documentation. Electronic Document Management System features. Transportation Management System (TMS) Maintenance Management None identied
ED.6: Manage Transportation ES.6: Manage Incoming Product ER.6: Manage Return Transportation P2.1: Identify, Prioritize and Aggregate Product Requirements
A software based system that corrects shelf inventory levels based on actual product present (possible RFID solution). Identies stock-outs from shrinkage or item misplacement. None identied
Maximize Data Integrity and System Accuracy by Ensuring 99%+ Accuracy of BOM Conguration, Inventory Levels, and Schedule Requirements Measure Customer Service
M3.2: Schedule Production Activities
Advanced Shipping Notices (ASN) Parcel and Container Routing and Rating Compliance Labeling Real time shipment tracking DSS or portal tool that shows previous period performance and comparison for store management (whether it is a year ago, period ago, etc.).
Measured and Compared with Same Activity Previous Period
4.1.56
SCOR
Best Practice
Measurement of Carrier Performance for On-time Delivery and Completeness Measurement, Monitoring and Adjustment of Service or Product Installation Measuring Process Metrics and Feedback to Operators
Denition
Transportation Management System (TMS) Maintenance Management None identied
Process
ER.6: Manage Return Transportation ED.6: Manage Transportation ES.6: Manage Incoming Product D4.7: Deliver and/or Install
Electronic data collection of completion, quality, scrap, labor and equipment data and dissemination of information on factory oor Electronic Kanban support
M1.3: Produce and Test
Mechanical (Kanban) Pull Signals Are Used to Notify Suppliers of the Need to Deliver Product Merge-in-Transit
S2.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S1.1: Schedule Product Deliveries D1.8: Receive Product from Source or Make D1.9: Pick Product M1: Make-to-stock
See detailed description in beginning of this chapter None identied
Migrate From Build to Stock to Congure to Order; Build Subassemblies to Forecast at the Highest Generic Level in the Bill of Material/ Recipe/Formula Minimize Capital Assets Required and Maintenance Costs Minimize Operator Induced Errors
Outsourcing strategies including the use of Application Service Providers (ASPs), web-based maintenance/diagnostic assistance and MRO parts. Automatic download of production equipment with setup parameters Graphical display of setup, changeover, or layout WIP Storage Management System Ecient Space Utilization Implementing Pull Systems Move high frequency used inventory close to point of use. For example, the system should provide the frequency of picks by part number so that high frequency picks can be moved to convenient locations or part pick quantities increased. Utilize electronic links
M2.4: Package M3.5: Package M1.4: Package EM.4: Manage In-Process Products (WIP) EM.4: Manage In-Process Products (WIP)
Minimizing In-Process Product (WIP) Minimum Product Handling
MRO Scheduling Identies Next Destination (Stores or Repair Station) on Return Authorization
4.1.57
SCOR
Best Practice
Multi-country Export/ Import documentation compliance Multiple Locations Throughout Store New Items Introductions Are part of the Sales and Operations Planning Process at the General Management Business Team Level Note and Communicate Shelf Life Requirements Carefully Before Shipping Notication of Existing/ Future Event or Promotions Obsolete Inventory is Reviewed at the Part Number Level
Denition
None identied
Process
ED.8: Manage Import/Export Requirements D4.5: Fill Shopping Cart
Planned and tracked via a plan-ogram system;Location specic product labeling. None identied
EP.7: Manage Planning Conguration
Hazardous material regulations are given specic attention. None identied None identied
ER.8: Manage Return Regulatory Requirements and Compliance D4.6: Checkout P2.2: Identify, Assess and Aggregate Product Resources P3.2: Identify, Assess and Aggregate Production Resources D4.4: Stock Shelf D4.4: Stock Shelf
O Peak Stocking
The majority of stocking is completed with minimal impact to or visibility from the customer. Web based access to current supplier/ source data Delivery of tooling and equipment details drawings ERP
On Demand Access of Supplier/Source Data On Line Access and Notication of Tooling and Equipment Information On Line Document Management and Automated Supplier Approval Processes Can Reduce the Cycle Time and Costs Associated With Managing Supplier Evaluations and Get Them into the Supplier Network Faster On Line RFQ Processes Linked into the Document Management Process Reduces Cycle Time and Product Management Costs
ES.3: Maintain Source Data EM.1: Manage Production Rules
S3.2: Select Final Supplier (S) and Negotiate ES.7: Manage Supplier Network
None identied
S3.2: Select Final Supplier (S) and Negotiate S3.1: Identify Sources of Supply
4.1.58
SCOR
Best Practice
On-Demand Access of Production Information
Denition
Data Collection and Display Systems designed for ecient performance of value-added operations in production. This could include using PLC, Machine Interface, bar code, Radio Frequency Communication, Radio Frequency Identication, Magnetic Stripe, Smart Cards, etc., to enable data collection None identied
Process
On-Demand Access to Available to Promise (ATP), Production Schedules and Inventory Status by Internal Operations and Customers On-Line Availability to Supplier Financials to Determine Potential Supplier Viability to be Added to Supplier Network Online Real-Time Customer Entry and Edit
Internet web sites for nancial evaluation
ES.7: Manage Supplier Network S3.2: Select Final Supplier (S) and Negotiate
On-line Customer Service Module CRM (Customer resource Management) software is getting a big push in the E-Commerce/E-Business areas and generally provides a means to fulll this requirement None identied Enterprise resource planning system Customer relationship management system
On-Line Rule Base On-Line Visibility of All Supply-Chain Demand Requirements and Resources, both Currently Available and Committed (Pegged) Operations and Network Analysis Optimize Packing
ED.1: Manage Deliver Business Rules P1: Plan Supply Chain
None identied No packing and unpacking time required. Recyclable or no containers where appropriate. No discarded material. Web based access to preferred and recommended suppliers, supplier performance data & spend data stratied by commodity, business unit/ site, supplier, part type, process type
ED.7: Manage Product Life Cycle EM.4: Manage In-Process Products (WIP)
Optimized Supply-Chain Processes, Optimized Supplier Count, Supplier and Part Rationalization
ES.10: Manage Supplier Agreements ES.1: Manage Sourcing Business Rules
4.1.59
SCOR
Best Practice
Order Entry is Organized by Customer Segment Customers Receive Dierentiated Service Based on Volume of Business Customer Team is Empowered to Fully Service Customer Requests, Including Formal Orders and Ad Hoc Requests Customers Have One Point of Contact for All Products Organize to Enhance Flexibility: Few Job Classications, SelfDirected Work Force, Flat Management Structure, Cross-Functional Work Teams Outsource If Not a Core Competency Packaging Operation is an Integral Part of the Overall Production Process Paperless Order Tracking and Customer Visibility of Orders Paperless Production Control
Denition
None identied
Process
D2.2: Receive, Congure, Enter and Validate Order
Support for modular skills inventory with links to training databases, compensations systems, and operator instructions
M2: Make-to- Order M3: Engineer-to-Order M1: Make-to-stock
Use 4PL to manage and move. None identied
ER.5: Manage Return Capital Assets M3.5: Package M1.4: Package M2.4: Package M3: Engineer-to-Order M2: Make-to- Order M1: Make-to-stock M1.3: Produce and Test M3.5: Package M3.4: Produce and Test M2.4: Package M1.4: Package M2.3: Produce and Test M1: Make-to-stock
Electronic dispatch and data collection with external interface to internet. Electronic dispatch of operations
Paperless Production Order and Inventory Tracking
Electronic dispatch and data collection. Allow customer access to production status and inventories using internet technologies and web site features. None identied
Partnership with Outside Design Firms to Provide Skills and Capacity, as Needed Pay on Receipt
D3.1: Obtain and Respond to RFP/RFQ
Electronic Invoice Processing
S2.5: Authorize Supplier Payment S3.7: Authorize Supplier Payment S1.5: Authorize Supplier Payment
4.1.60
SCOR
Best Practice
Performance Expectations and Business Rules Are Clearly Communicated Prior to the Initiation of Business with the Supplier Performance Results that Are Compared to Benchmarks (i.e. Capacity, Scheduling) and Readily Available to Employees Periodic Review of Metrics and Strategy with Comparisons to Industry Benchmarks Periodic Review of Standards Planning and Forecasting Outsourced Return process Planogram Flexibility for Seasonal/Promotional changes Plans that Violate Business Rules (e.g. Joint Service Agreements) Are Addressed Cross-Functionally, Considering Total Business Impacts (Revenue, Cost, Quality, Customer Service, Etc.) Plans Which Do Not Violate Business Rules Are Communicated Openly and Cross-Functionally for Execution Posted Performance Results
Denition
Web based access / availability to business rules and performance criteria
Process
Data warehouse, report writing, real time database and Executive Information systems that are easily accessible. Use of web-based technologies for dissemination of information. Real time view of data.
M1: Make-to-stock
ED.4: Manage Finished Goods Inventories ER.4: Manage Return Inventory ES.4: Manage Product Inventory EM.2: Manage Production Performance P5: Plan Return
Process for establishing and maintaining review schedules Collaborative planning and forecasting with RETURN outsourcing partners (3PL, reverse drop shippers, etc.) None identied
P4.1: Identify, Prioritize and Aggregate Delivery Requirements P4.4: Establish Delivery Plans
None identied
None identied
Data warehouse, report writing, real time data base and EI systems See detailed description in beginning of this chapter
M3: Engineer-to-Order M1: Make-to-stock M2: Make-to- Order D1: Deliver Stocked Products M2: Make-to- Order M1: Make-to-stock D2: Deliver Make-to-Order Product
Postponement
4.1.61
SCOR
Best Practice
Postponement and PreKitting Of Accessories into Modular Packages that Allow Flexibility While Maintaining Control Pre-Certify Supplier Capability to Send Return Products Correctly to Minimize the Need for Receipt Verication Pre-Dened Manufacturing Design Rules Predictive Maintenance Monitoring (Heat, Noise, Lubrication Composition & Vibration)
Denition
None identied
Process
M3.5: Package M2.4: Package M1.4: Package
- Push inspection to SOURCE - Receiving quality criteria connected to ISO 9000 practices
DR3.3: Receive Excess Product DR2.3: Receive MRO Product DR1.3: Receive Defective Product
Libraries of manufacturing capabilities or design envelopes Database for equipment to contain expected results of analysis, allow entry of test readings, and have capability of generating desired reports, which could highlight suggested actions based upon readings obtained, track maintenance completed, contain a help-le to be consulted None identied
EM.1: Manage Production Rules EM.5: Manage Make Equipment and Facilities
Priority-Based Inventory Reservations, for Key Customers, with FIFO Allocation for All Others Proactive Education of Customers to Set Expectations and Encourage Close Working Relationships (Knowledge of Long-Lead Items, Visibility to Supply Resources, Agreement on Levels of Flexibility) Produce Products to Unique Customer Requirements Product Data Management & Electronic Document Management Are Used to Manage Technical Documents and Requirements for Engineer to Order Product Product Design Collaboration with Customers
None identied
P4: Plan Deliver
Order entry specications linked to manufacturing order None identied
M2.1: Schedule Production Activities M1.1: Schedule Production Activities M2: Make-to- Order S3.1: Identify Sources of Supply
On-line design tools facilitated by internet connections.
M3: Engineer-to-Order
4.1.62
SCOR
Best Practice
Production Level Loading Production Reporting/ Status Proof of Performance (Promotion Management) Provide Continuous Formal Training to Employees
Denition
Capacity planning Real time monitoring of production status and In-Process Product (WIP) Scan store shelves / bar codes to conrm put-a-way. Scan using handheld and match with ad. Examples would be TQM, Six Sigma.
Process
M1: Make-to-stock M2: Make-to- Order EM.7: Manage Production Network D4.4: Stock Shelf
M1.3: Produce and Test M1: Make-to-stock M3.4: Produce and Test M2: Make-to- Order D4.7: Deliver and/or Install
Provide Product or Service Training to Employees or FAQs Online Provide Scheduling Output Back to Material and Labor Planning Systems Provide Single Source of Information on the Customer (Single Group / Owner Responsible for Accuracy / Quality of Customer Data) Provide Visibility to and Quickly Escalate Delinquent Accounts for Resolution Publish Return Policy Push Product on Trailer Arrival Push-Based Forecasts Are Replaced with Customer Replenishment Pull-Based Signals Quote Capability, without Reserving Inventory, Which Can Be Converted into an Order in a Single Step Quote Capability, without Reserving Inventory, Which Can be Converted into an Order, But Does Not Generate Build Signal or Reserve Inventory Capacity
None identied
Allow dynamic re-synchronization of MAKE activities by tying in real time status information to scheduler Secure E-Commerce Server and integrated Order Management System (OMS) Warehouse Management System (WMS) and Transportation Management System (TMS) Integrated accounts receivables
M1.1: Schedule Production Activities
D1.15: Invoice D3.15: Invoice D2.15: Invoice ER.1: Manage Business Rules for Return Processes D4.2: Receive Product at the Store D4.1: Generate Stocking Schedule P1.1: Identify, Prioritize and Aggregate SC Requirements
Easy access to return business rules. System prioritization of items coming o trucks vs. picked from back room. Standards Based (RosettaNet, eBXML, OAGI, etc) B2B integration tools and systems None identied
D1.1: Process Inquiry and Quote D2.1: Process Inquiry and Quote
None identied
D2.1: Process Inquiry and Quote
4.1.63
SCOR
Best Practice
Rapid Reconguration of Return Capacity
Denition
Use of RETURN tracking and projection systems and exible partner agreements that allow the rapid addition of RETURN capacity to match unexpected demand. None identied The ability to reset and recongure the RETURN process capacity, routings, etc. by transmitting new requirements and directives using mathematical models, the Internet, outsourcing and exible partnership agreements. Also requires integration with the CRM system for real time redirection of customer returns based upon cost and capacity. Dynamic calculation of safety stock based on actual sales.
Process
Rapid Replenishment, VMI, EDI Rapid, Dynamic Reconguration of Return Process to Meet Demand
D1: Deliver Stocked Products P5.4: Establish and Communicate Return Plans
Real Time Data on Current Status
ER.4: Manage Return Inventory ES.4: Manage Product Inventory ED.4: Manage Finished Goods Inventories M1.1: Schedule Production Activities
Real Time Feedback from Production, Raw Materials, and Finished Goods Inventory and Test Activities Real Time Package Tracking Real Time Performance Measurement Reporting Systems
Allow dynamic re-synchronization of MAKE activities by tying in real time status information to scheduler. Tracking and tracing Systems to collect production information online generate reports upon request by operators, and track progress against schedule and standards. Electronic collection of quality data and on-line SPC. Having real time data on return demand and including it in the plan and forecast. Requires a connection with customers, call centers or CRM system, possibly to the store level with retail returns. The return demand needs to be included in the production plan as soon as possible because upon repair it may be the next piece of serviceable inventory to satisfy demand. Electronic collection of defect data and on-line SPC.
ED.2: Assess Delivery Performance EM.2: Manage Production Performance
Real Time quality control techniques Real Time Return Anticipation
M1.3: Produce and Test M2.3: Produce and Test M3.4: Produce and Test P5.1: Assess and Aggregate Return Requirements
Real Time Statistical Control Techniques
M2.3: Produce and Test M1.3: Produce and Test M3.4: Produce and Test
4.1.64
SCOR
Best Practice
Real-Time Optimized Shipment Method Selection (Air Parcel, Ground Parcel, LTL, etc.) Based on Customer Service Requirements Real-Time Shipment Tracking, (via internet) Re-Balancing of Full-Stream Supply/Demand on a Daily Basis, Including SourceMake-Deliver Resources and Requirements from Customers Customer to Suppliers Supplier Receivers on the Dock Communicate Directly with the Buyer to Eciently Resolve Any Discrepancies Receiving Equipment and Packaging Materials to Transfer Product Are Planned for In Advance and Readily Available When Needed Reduce Chances of Operator Error Reduce In-Process Product (WIP) Handling
Denition
Transportation Management System (TMS) Maintenance Management
Process
ED.6: Manage Transportation ER.6: Manage Return Transportation ES.6: Manage Incoming Product
Transportation Management System (TMS) Maintenance Management Enterprise-wide planning system customer Relationship Systems
ES.6: Manage Incoming Product ER.6: Manage Return Transportation ED.6: Manage Transportation P1: Plan Supply Chain
Buyers name for every receipt is clearly visible on Receiver.
DR2.3: Receive MRO Product DR1.3: Receive Defective Product DR3.3: Receive Excess Product DR2.4: Transfer MRO Product DR3.4: Transfer Excess Product DR1.4: Transfer Defective Product
Include packaging materials in inventory management system and treat as any other inventory to minimize potential of stock-out.
Automatic download of production equipment with batch recipes/part programs Reduction of WIP handling through automation (i.e. AGVs and ASRS) and process improvement (i.e. reduction of handling steps, shorter move paths) Use principals of Lean Manufacturing.
M2.3: Produce and Test M1.3: Produce and Test EM.6: Manage Transportation (WIP)
Reduce Non-Value Added Activities, Including Queue, Move, and Set-Up Times Reduce Non-Value Added Paperwork While Still Measuring Process Metrics Reliable Continuous Improvement Process and Methodology.
M2.3: Produce and Test M3.4: Produce and Test M2.3: Produce and Test M1.3: Produce and Test M2.4: Package M3.4: Produce and Test M1.4: Package M1.3: Produce and Test EP.2: Manage Performance of Supply Chain
Electronic data collection of completion, quality, lot tractability, scrap, and labor data None identied
4.1.65
SCOR
Best Practice
Remote (Sales, Customers) Order Entry Capability
Denition
None identied
Process
D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order ES.5: Manage Capital Assets ED.5: Manage Deliver Capital Assets EP.10: Align Supply Chain Unit Plan with Financial Plan
Removal of Obsolete Capital Assets Removal of Obsolete Stock Re-Planning Process Exists in Multi-Levels of the Supply-Chain between Business Enterprises Re-Planning Process Links the Supply Chain Operation with the Business Strategy and the Marketing Strategy Responsiveness and Flexibility Are Emphasized By Developing Expertise in Making Business Processes Re-Programmable, Re-Congurable and Continuously Changeable Return Process Electronically Tracks Transfer from Station to Station Review Batch Records by Exception
Automated Calculation of ABC Velocity Movement Automated Calculation of ABC Velocity Movement Business to business Internet capability to share common data.
None identied
Integrated process modeling and software reconguration tools
Utilize Bar coding
DR3.4: Transfer Excess Product DR1.4: Transfer Defective Product DR2.4: Transfer MRO Product M2.6: Release Finished Product to Deliver M1.6: Release Product to Deliver M3.7: Release Product to Deliver P1.2: Identify, Prioritize and Aggregate SC Resources DR1.4: Transfer Defective Product DR2.4: Transfer MRO Product DR3.4: Transfer Excess Product
Electronic batch records linked to process plans/recipes and exceptions agged ABC and cost modeling. Periodic review of capital asset plan to determine if additional equipment, if needed, can be funded.
Review Product Protability Review Transfer Cycle Time Trends and Determine If Equipment Capacity is Properly Balanced with Projected Usage RFID and Other Tagging Sales and Operations Agree to Limits of Short Term Flexibility Sales and Operations Planning (S&OP)
POG software/eld force None identied
P4.1: Identify, Prioritize and Aggregate Delivery Requirements P2.1: Identify, Prioritize and Aggregate Product Requirements P1: Plan Supply Chain
4.1.66
SCOR
Best Practice
Scan Displays for Promotion Conformance Schedule Includes Preventative Maintenance Program Schedule Minimizes Changeover Costs between Products Schedule Optimizes Use of Shared Resources Such as Tooling and Production Equipment Schedule Reects Current Plant Status (Equipment Availability, Other Jobs and Resource Availability) On Line Segregate In-Bound Carcass Return Cost from Other Transportation Costs Select Carriers by Least Cost per Shipment and Rate Using Actual Rates Prior to Release to Billing
Denition
None identied Interface between maintenance management system and scheduling system Algorithms that manage set up times/ costs, cleaning times, and ideal job sequences (e.g., color sequencing light to dark) Scheduling utilizing optimization techniques Required production resources included in routing/process instructions Schedule undated by on line reporting and status systems and re-sequence activities
Process
D4.4: Stock Shelf M1.1: Schedule Production Activities M3.2: Schedule Production Activities M2.1: Schedule Production Activities M2.1: Schedule Production Activities M1.1: Schedule Production Activities M3.2: Schedule Production Activities M1.1: Schedule Production Activities M3.2: Schedule Production Activities M2.1: Schedule Production Activities M3.2: Schedule Production Activities M1.1: Schedule Production Activities M2.1: Schedule Production Activities
None Identied
Rules based carrier selection and actual rate database
D3.7: Select Carriers & Rate Shipments D3.6: Route Shipments D1.7: Select Carriers and Rate Shipments D2.7: Select Carriers and Rate Shipments ( ER.7: Manage Return Network Conguration
Service Provider Utilizes Web-Based Communicate to Identify New and Discontinued Repair Sites to Customers Set Up Electronic or Preauthorized Returns
Continuously updated authorized repair sites
None identied
DR1.1: Authorize Defective Product Return DR3.1: Authorize Excess Product Return DR2.1: Authorize MRO Product Return D3.12: Ship Product D1.12: Ship Product D3.13: Receive and Verify Product by Customer D2.13: Receive and Verify Product by Customer D1.11: Load Vehicle & Generate Shipping Docs D2.12: Ship Product
Shipment Tracking
None identied
4.1.67
SCOR
Best Practice
Shipment Tracking and Tracing
Denition
Satellite communications, GPS, RFID
Process
SR3.5: Return Excess Product SR1.5: Return Defective Product D2.6: Route Shipments D1.6: Route Shipments D3.6: Route Shipments SR2.5: Return MRO Product EM.6: Manage Transportation (WIP)
Short Move Paths
Software that allows for input of the distance that particular parts/WIP need to be moved. This software then need to provide a report based on the cubic feet of material times distance moved by part number. A data warehouse/data mart is the source of all planning (master) data, business rules and transaction data. Analyzing tools enable the ongoing maintenance and improvement of the business rules based on actual data. None identied
Single Data Source for Decision Support and Business Rules
Single Point of Contact for All Order Inquiries (Including Order Entry) SKU Rationalization Sound Project Management Process and Methodology Specic Changes to the Plan Are Agreed to CrossFunctionally, According to Dened Business Rules Stage Product or Service Adoption Staging Based on In-store Zones Standard Inventory Policy to Determine Excess Standard Operating Procedures and Methodology Standards and Measurements Aligned to Maximize Supply Chain Performance
D2.1: Process Inquiry and Quote D1.1: Process Inquiry and Quote EP.7: Manage Planning Conguration EP.2: Manage Performance of Supply Chain P4.4: Establish Delivery Plans
None identied None identied None identied
None identied Items are staged for re-stocking based on zones within the store. This minimizes restocking eort. None Identied None identied
D4.7: Deliver and/or Install D4.3: Pick Product from Backroom
ER.1: Manage Business Rules for Return Processes ED.7: Manage Product Life Cycle ED.5: Manage Deliver Capital Assets EM.2: Manage Production Performance
Internal/external benchmarking, industry standards, customer/supplier alignment agreements, visibility of key performance indicators
4.1.68
SCOR
Best Practice
Denition
Process
ER.4: Manage Return Inventory EM.4: Manage In-Process Products (WIP) ED.4: Manage Finished Goods Inventories ES.4: Manage Product Inventory D4.4: Stock Shelf
Stocking is Completed in Zones Storage and Conguration Management for Release and Revision Control of Final Documents Storage Location Zoning Strategic Safety Stock of Selected Materials, Items, or Subassemblies to Decouple Sourced Product Issuance Cycle Time from Supplier Lead Time Strategic Sales and Operations Planning Process in Place and Managed at the Executive Level Substitution
Each area of the store has its own stocking plan and items are routed specically to that area. Product data management (PDM) or Electronic Data Management (EDM) feature set Automated or Optimized Slotting (Storage Location) Systems Use of safety stock algorithms to minimize stock levels.
ED.5: Manage Deliver Capital Assets M1.2: Issue Material M2.2: Issue Sourced/In-Process Product M3.3: Issue Sourced/In-Process Product EP.10: Align Supply Chain Unit Plan with Financial Plan
None identied
Trained sta or automated systems (Internet) that recommend up-sell, cross-sell, and/or substitution.See Up and cross selling Software application to automate data collection and reporting
Supplier Cost of Nonconformance Data is Collected, Analyzed and Used in Performance Reporting Supplier and Material Rationalization Supplier Certication Programs Are Used to Reduce (Skip Lot) or Eliminate Receiving Inspection
Web based access to supplier/source data Skip lot/sampling inspection logic
ES.3: Maintain Source Data S3.4: Receive Product S2.3: Verify Product S2.2: Receive Product S1.3: Verify Product S3.5: Verify Product S1.2: Receive Product
4.1.69
SCOR
Best Practice
Supplier Certication Programs Can Reduce the Cycle Time for Certifying Existing Suppliers to Provide New Technologies Supplier certication programs can reduce the cycle time for initial certication of New Suppliers or Certifying Existing Suppliers that Wish to Provide New Technologies Supplier Delivers Directly to Point of Use Electronic Tag tracking to Point of Use (POU) destination
Denition
None identied
Process
S3.2: Select Final Supplier (S) and Negotiate ES.7: Manage Supplier Network
S1.3: Verify Product S3.5: Verify Product S2.3: Verify Product S1.2: Receive Product S2.2: Receive Product S2.3: Verify Product S3.4: Receive Product
Supplier Delivers Directly to Point of Use - (Dock to Line or End Destination) Supplier Delivery to Production Process at Point of Use
Electronic Tag tracking to Point of Use (POU) destination EDI link to suppliers sales order and inventory systems
M2.2: Issue Sourced/In-Process Product M1.2: Issue Material M3.3: Issue Sourced/In-Process Product S3.1: Identify Sources of Supply
Supplier Development Programs Are Used to Get Local Suppliers to Invest in Developing New Technologies Supplier Managed Inventories with Scheduling Interfacs to External Supplier Systems Supplier Managed Inventory of Parts Supplier Performance Assessment System Supplier Replaces Defective Material at Customers Facility with Good Product as Required
None identied
VMI agreements allow suppliers to manage (replenish) inventory
S1.1: Schedule Product Deliveries
E.D.I. linkage of Inventory Information See detailed description in beginning of this chapter Electronic Tag tracking to Point of Use (POU) destination
EM.5: Manage Make Equipment and Facilities ES.2: Assess Supplier Performance S2.3: Verify Product S1.3: Verify Product S3.5: Verify Product
4.1.70
SCOR
Best Practice
Suppliers Share Responsibility for Balancing Supply and Demand through Joint Service Agreements Supply Chain Advance Planning System
Denition
None identied
Process
P2.3: Balance Product Resources with Product Requirements
Collaboration among Supply Chain partners extends outwards to customers, spanning the supply chain.Planning,Re-planning,Business Rules,Plan Changes None identied
P1.4: Establish & Communicate Supply-Chain Plans P1.1: Identify, Prioritize and Aggregate SC Requirements P1: Plan Supply Chain
Supply Chain is Designed to Have Supply Flexibility Equal to Demand Volatility Supply/Demand Process is Highly Integrated from Customer Data Gathering to Order Receipt, through Production to Supplier Request Systematic Disposition Of Equipment Systems Support Accurate On-Line Visibility of Full-Stream Demand Requirements and Priorities Systems Support Accurate On-Line Visibility of Full-Stream Demand Requirements and Priorities as Well as Resource Utilization and Availability The Demand Plan is Updated Frequently to Reect Actual Consumption or Customer Forecast Information To Address Conditions which Cannot be Adequately Satised During the Current Planning Period, Each Functional Area Develops Prioritized Recommendations for the Subsequent Planning Period
Integrated supply chain planning system with interfaces to all supply/ demand data sources through public and private digitally enabled supply networks. Rules for deciding appropriate disposition. Advance Planning and Scheduling System, Supply Chain Event Management Software Advance Planning and Scheduling System
EM.5: Manage Make Equipment and Facilities P1.1: Identify, Prioritize and Aggregate SC Requirements
None identied
None identied
4.1.71
SCOR
Best Practice
Tools Support Balanced Decision Making (e.g., Trade-O between Service Level and Inventory Investment) Total Preventative Maintenance Program
Denition
Supply chain planning optimization system
Process
Automatically generated TPM repair schedules integrated with MRP systems, electronic equipment repair history, parts listings, part stores inventory & reorder points, automatic store room parts purchases, Shop oor access to electronic data base of equipment line drawings, electrical wiring diagrams, parts listing reference guide and part cost lists. None identied
ES.5: Manage Capital Assets EM.5: Manage Make Equipment and Facilities
Transportation Modeling and Rate Analysis
SR3.4: Schedule Excess Product Shipment SR2.4: Schedule MRO Shipment SR1.4: Schedule Defective Product Shipment M3.3: Issue Sourced/In-Process Product
Two-Bin Floor Stock Located at Work Center for B And C Components Controlled by Operators and Replenished When One Bin is Empty Unique Identier Tag for Each Repairable Asset Unplanned Orders Are Accepted and Scheduled Only When There is No Detrimental Impact on Overall Product Delivery Plan Up and Cross Selling and/or Substitution Up-to-Date Shop Packet/ Specication for Each Unique Production Event/ Demand Up-to-Date Shop Packet/ Specications
None identied
Asset management software using bar code, RFI tag, etc. Digital Linkages using XML standards (RosettaNet, eBXML, OAGI) to automatically query production capacity and ATP and schedule unplanned orders. Trained sta or automated systems (Internet) that recommend up-sell, cross-sell, and/or substitution. Electronic Work Instructions
ER.4: Manage Return Inventory P3.4: Establish Production Plans P4.1: Identify, Prioritize and Aggregate Delivery Requirements
M2.4: Package M1.4: Package
Electronic work instructions
M3.4: Produce and Test M2.3: Produce and Test M1.3: Produce and Test M3.5: Package
4.1.72
SCOR
Best Practice
Use an Exchange System Where Customer is Issued a Serviceable Item Upon Submitting an Unserviceable Item Use Demand Planning
Denition
None identied
Process
DR2.1: Authorize MRO Product Return DR1.1: Authorize Defective Product Return
Demand Planning Systems to forecast returns, predict yield rates for reusable products or components, determine demand in a resale market, and project a revenue stream. None identied None identied
P5: Plan Return
Use Historical Based Return Rate Forecasts Use of CAD/CAE Applications to Simulate Design, Cost and Manufacturing Process Use of Cross Functional Teams to Execute the Process of Developing LongTerm Capacity and Resource Plans Use of Platform Teams in the New Product Development Process Use of Speed Racks for Automated Material Handling Utilize Concurrent Engineering with Suppliers to Allow Them to Provide Engineering and Product Performance Test Data Utilize Concurrent Engineering with Suppliers to Allow Them to Provide Engineering and Product Performance Test Data to Qualify as Part of Potential Supplier Network Utilize EDI and EFT for Payment to Speed Closing of Receivables and to Reduce Processing Costs Utilize EDI Transactions to Reduce Cycle Time and Costs
P5.1: Assess and Aggregate Return Requirements D3.1: Obtain and Respond to RFP/RFQ
None identied
EP.5: Manage Integrated Supply Chain Capital Assets EP.6: Manage Integrated Supply Chain Transportation EP.7: Manage Planning Conguration
None identied
None identied
D1.9: Pick Product D2.9: Pick Product S3.2: Select Final Supplier (S) and Negotiate
None identied
Internet, EDI, FAX
EDI transaction and network services
D3.15: Invoice D2.15: Invoice D1.15: Invoice S1.1: Schedule Product Deliveries S3.3: Schedule Product Deliveries S2.1: Schedule Product Deliverie
EDI interface for 830, 850, 856 & 862 transactions
4.1.73
SCOR
Best Practice
Utilize Enterprise Information Systems
Denition
Enter, Process, and Deliver information about the manufacturing process to management using information systems that span the enterprise None Identied
Process
Utilize Internet-Based Freight Bidding Built Around Shared Shipping Volume Projections Utilize Invoice-less Freight Payment Utilize Real-World Cases in Employee Training Utilize Web-Based Collaboration between Asset Manager and Repair Sites Regarding Capacity and Scheduling Utilize Web-Based Collaboration between Customer and Service Provider on In-Bound Return Forecasts and Asset Tracking Utilize Web-Based Collaboration to Identify Potential New Repair Sites Prior to Their Selection Value Pricing Based on Cost to Serve; EDLP; Cost Plus Pricing Vendor Managed Inventory
None Identied None Identied Total return asset visibility throughout the network
ER.6: Manage Return Transportation ER.1: Manage Business Rules for Return Processes ER.7: Manage Return Network Conguration
Shared return forecasts
Shared knowledge of resource availability and bottlenecks
Activity Based Costing; Integrated Order Management by Customer by Line Item
D2.2: Receive, Congure, Enter and Validate Order D1.2: Receive, Enter and Validate Order S3.4: Receive Product D1.5: Build Loads EM.4: Manage In-Process Products (WIP) P1: Plan Supply Chain S2.2: Receive Product S1.2: Receive Product P4.1: Identify, Prioritize and Aggregate Delivery Requirements D3.5: Build Loads ES.7: Manage Supplier Network M1: Make-to-stock S2.1: Schedule Product Deliveries D2.6: Route Shipments ES.4: Manage Product Inventory
4.1.74
SCOR
Best Practice
View for Analysis for All Orders and Shipments the Following Data: Logistics, Product, Cost, GL Charging Wave picking
Denition
Transportation Management System (TMS) Maintenance Management
Process
D.6: Manage Transportation
D1.9: Pick Product
4.1.75
4.1.76
GreenSCOR
Best Practice
Access to supplier environmental data Aggregate requirements Avoid returns beyond economic repair Balance environmental requirements Benchmark practices Bulk Packaging Bundle deliveries Collaborate with supply chain partners Collaborative environmental management processes Communicate environmental requirements Consider environmental impacts Consider environmental production constraints Considerations emissions in transportation decisions Consolidate shipments where possible Consolidate to minimize energy consumption Daily HAZMAT inspection Develop environmental performance standards. Develop supplier partnerships
Description/Denition
Access to supplier environmental management and compliance data Aggregate requirements to minimize transportation requirements Estimate damage to product and do not physically return product that is beyond economical repair or oers no diagnostic value Balance environmental requirements as well as supply/demand requirements Benchmark practices of other rms Package larger groups of items in a single package (bulk) Bundle deliveries of dierent products into single shipment when possible Supply chain partners collaborate to improve the environmental performance of the supply chain Collaborative environmental management processes with suppliers, including EMS integration Include environmental requirements in communications. Consider environmental impacts when identifying requirements Environmental constraints are considered as part of production capacity Integrate environmental emissions considerations to transportation decisions. Feature: Implement Environmental Management System Consolidate shipments where possible Consolidate to minimize fuel/energy consumption Daily inspection of any hazardous waste storage areas Develop environmental performance standards. Develop a partnership with suppliers to help them implement and maintain environmentally sustainable business practices Enable direct shipments between customers to reduce overall transportation and handling.
Process
ES.3 P4.1 DR1.1, DR2.1
P1.3, P3.3 M1.3, M2.3, M3.4 M1.4, M2.4, M3.5 S1.1, S2.1, S3.3 P1.4 ES.1
P1.4 P1.1, P1.2 P3.2 EP . 6
DR2.2 D1.4, D2.4, D3.5 M1.7, M2.7, M3.8 EM.2 ES.2
Enable customer direct shipments
SR.3, DR.3
4.2.1
GreenSCOR
Best Practice
Energy-ecient buildings
Utilize energy-ecient lighting and heating systems throughout warehouse and production areas Utilize energy-ecient HVAC systems Ensure all required environmental documentation is obtained Implement an Environmental Management System (EMS) to track and manage environmental performance and to track performance against regulatory requirements Develop environmental performance standards. Establish environmental partnerships with suppliers Establish supplier environmental requirements Establish spill controls for nished goods inventory storage Factor environmental considerations/restrictions into capacity planning Identify and manage environmental aspects and impacts of supply chain operations to mitigate the impacts mitigate the impacts Identify products that are manufactured to minimize environmental impacts Identify MRO items that will need planned maintenance during the planning horizon Identify recyclable/reusable materials Identify products in take-back programs that are near end of life Implement comprehensive pollution prevention program and include environmentally preferable purchasing. Implement an EMS
Process
ES.4
Energy-ecient HVAC systems Ensure environmental documentation Environmental Management System (EMS)
ES.4 M1.6 P1, EP.8
Environmental performance standards. Establish environmental partnerships Establish environmental requirements Establish spill controls Factor environmental considerations into planning Identify and manage environmental impacts Identify green products Identify items to return Identify recyclable/reusable materials Identify take-back programs Implement pollution prevention program Implement an EMS
EP.1 S3.2 ES.7 D1.3, D2.3 EP.5 P1
P2.2 P5.1 P2.2 P5.1 M1.3, M2.3
EM.2, EM.8, M1.3, M2.3, M3.4, EM.1, M3.7, M1.6, M2.6 M1.6, M2.6, M3.7, EM.5
Implement HAZMAT pharmacy system
Implement hazardous materials pharmacy system
4.2.2
GreenSCOR
Best Practice
Implement pollution prevention program
Implement rigorous pollution prevention program
Process
EM.8, EM.4, EM.6, S1.4, S2.4, S3.6, M1.2, M2.2, M2.7, M3.3, M3.8 D1.3, D2.3 ED.1 EM.3 M1.6 S1.1, S2.1, S3.3 EP.1 EP.2 ED 8 ED.4 EP.7 M1.4, M2.4, M3.5 P4.3, P4.4 P1 P3.4 P3.4 P2.2, P4.2
Include environmental costs Include environmental requirements Include products environmental attributes Include supplier environmental information Infrequent product delivery Integrate environmental considerations Manage environmental performance Manage foreign environmental requirements Manage hazardous inventory Material content classication Maximixe Container Loading Maximize loads, minimize runs Measure environmental impacts Minimize energy use Minimize Make emissions Minimize packaging
Include environmental costs in inventory carrying costs Include environmental requirements in deliver rules Include products environmental attributes information Include supplier environmental information in addition to product environmental information Minimize need for frequent shipments by accurately determining product needs Integrate environmental considerations into the business rules. Manage environmental performance of the supply chain. Manage foreign environmental requirements Manage hazardous inventory Material content classication (HAZMAT recycleable, etc.) Re-design container shapes to minimize material used but retain amount of product stored Maximize load size; minimize transportation runs Measure environmental impacts of the supply chain Plans are created to minimize energy use Plans are established to minimize emissions (e.g., release VOCs after dark) Work with suppliers to minimize packaging requirements and use reusable packaging material Plan the use of high-eciency, low-emissions,or alternative-fuel vehicles where possible Review product for compliance with environmental specications, including product packaging
Minimize vehicle fuel use Monitor product compliance
P4 S1.3, S2.3, S3.5
4.2.3
GreenSCOR
Best Practice
Monitor supplier environmental compliance Plan for proper product disposal Pollution prevention program
Determine supplier environmental compliance performance/Actively participate in regulation development Plan for proper product disposal Implement comprehensive pollution prevention program and include environmentally preferable purchasing. Select rms that oer product take-back programs Provide environmental training to all employees Purchase environmentally friendly materials Purchase previously used supplies Purchase products from recyclers or remanufactures Identify processes that reduce environmental impacts of manufacturing Retrieve packaging after installation for reuse
Process
EP.8
ED.7 M3.4
Product take-back programs Provide environmental training Purchase environmentally friendly materials Purchase previously used supplies Purchase recycled product Reduce Make environmental impacts Retrieve packaging after installation
S.3.2 M2.3, M3.4, M1.3 P2 S3.1 S3.1 P3 D1.12, D2.12, D3.10, M1.4, M2.4, M3.5 ES.4 D1.6, D2.6 M1.1, M2.1, M3.2 M1.1, M2.1, M3.2 D3.4 D1.7 D1.5, D1.7, D2.5, D2.7, D3.6 D1.5 D1.7 S3.2 S3.2 P2, S1, S2, S3
Reusable pallets Route to minimize fuel consumption Schedule air emissions after sunset Schedule high energy consumption at night Schedule to maximize transportation capacity Select carriers using retread tires Select carriers with EMS
Utilize reusable pallets Route to minimize fuel consumption Schedule air emission emitting activities after sunset Schedule electricity consuming (large amounts) activities from sunset to sunrise Schedule to maximize transportation capacity Select carriers using retread tires Select carriers that have adopted an EMS or otherwise demonstrated environmental commitment Select carriers with good environmental records Select carriers that have not violated environmental laws Select rms that have implemented an EMS Select rms that are ISO 14001 certied or similar Select suppliers with active EMS systems
Select carriers with good records Select complaint carriers Select rms with EMS Select ISO 14001 rms Select suppliers with EMS
4.2.4
GreenSCOR
Best Practice
Spill control Storm water management plans Stormwater prevention plans Supplier environmental performance criteria Take-back program Track foreign environmental requirements Track supplier environmental records Use multi-purpose packaging Use non-toxic solvents Use recyclable packaging Use reusable packaging Utilize alternative fuel vehicles
Spill control Implement storm water management and spill response plans Stormwater prevention and spill control plans for waste accumulation areas Develop a set of environmental performance criteria for all suppliers Take-back program at end of product life Maintain and manage current foreign environmental regulations Processes to identify suppliers with good environmental records Use multi-purpose packaging that can be used by customer Use non-toxic solvents for machinery cleaning Use recyclable packaging Use reusable packaging where possible Utilize alternative fuel vehicles
Process
ED.4 ES.4 M1.7 ES.2 ED.7 ES.8 P2 M1.4, M2.4, M3.5 EM.5 M1.4, M2.4, M3.5 P4.2 S1.4, S2.4, S3.6, M1.2, M2.2, M3.3, EM.6 EM.5 S1, S2, S3 S1.4, S2.4, S3.6, M1.2, M2.2, M3.3 M2.2, ES.4 EM.5 EM.6 M1.1, M1.2, M3.2 EM.6 M1.7, M2.7, M3.8
Utilize energy-star (or similar) equipment Utilize green purchasing practices Utilize high eciency vehicles Utilize maintenance free batteries Utilize non-toxic materials Utilize non-wood or recycled pallets Utilize o-peak shifts Utilize retread tires Waste accumulation EMS
Utilize energy-star (or similar) equipment whenever possible Utilize green purchasing practices Utilize high fuel eciency vehicles Utilize maintenance free batteries in warehouse/ short haul vehicles Utilize non-toxic solvents and cleaning materials Utilize non-wood pallets or recycled pallets Utilize o-peak shifts for production workers (e.g.,shift 1 = 11:0019:00) Utilize retread tires EMS covering waste accumulation processes
4.2.5
4.2.6
Risk Management
Supply Chain Risk Management (SCRM)
Supply chain risk management is the systematic identication, assessment and mitigation of potential disruptions in logistics networks with the objective to reduce their negative impact on the logistics networks performance. A high number of potential disruptions can negatively impact supply chain performance. Potential disruptions can either occur within the supply chain (e.g. insucient quality, unreliable suppliers, machine break-down, uncertain demand, etc.) and outside (e.g. ooding, terrorism, labor strikes, natural disasters, etc.). Both are considered in an integral three-phase approach for supply chain risk management: Phase 1 - Risk Identication: What can go wrong? What is uncertain? Based on a description of a supply chain with SCOR, each single process should be looked at with regards to potential disruptions that may negatively harm the performance and which countermeasures are already in place. Result of this phase is a list of the relevant supply chain risks. Phase 2 - Risk Assessment: How likely is it that a certain potential incident will occur? What is the impact? The likelihood of occurrence and the negative impact on SCOR performance measures of each supply chain risk should be qualitatively or quantitatively evaluated. Result of this phase is a list of serious risks that can be visualized in a risk portfolio with the dimension probability of occurrence and negative impact. Phase 3 Risk Mitigation: How can the risks be controlled and monitored? Mitigation measures (e.g. improved planning methods, alternative suppliers, response plans, redundant infrastructure, etc.) should be evaluated for the serious risks. After having checked the cost-eciency of the alternative measures, the appropriate measures should be chosen and implemented. A risk can be mitigated by deceasing the likelihood that it will occur of by decreasing its impact if it does occur. Alternatives to mitigation include acceptance, transfer, and risk sharing.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need and Suitability Indicators Supply chain risk management is suitable especially for supply chains in uncertain environments, with low redundancies in terms of material and capacity buers as well as high requirements on the supply chain performance. Risk management is particularly applicable to organizations that have a low tolerance for risk in their business strategy.
4.3.1
Risk Management
Additional Comments Examples for typical supply chain risks are raw material shortage, supplier failures, increased material price, machine break-down, uncertain demand, inaccurate forecasts, change orders and transportation failure. Other risks not directly related to the supply chain are for example product liability risk or strategy risk. Therefore supply chain risks are only a part of all business risks. Hence, supply chain risk management should be integrated in an enterprise risk management. For the implementation of supply chain risk management in organisations the process and responsibilities have to be clearly dened. The resources, e.g. sta, budget, should be assigned by the top management. The participating sta members need to be motivated and skilled. Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Experienced Impact The over-all objective of SCRM is to increase the reliability of the supply chain and decrease the variability of the order fulllment. The variability of the order fulllment cycle time is reduced and the recovery time from disruptions is shortened. Due to the proactive proceeding the supply chain is better prepared for sudden changes and thus more exible. The logistics costs are reduced in the long run. The variability of inventories in the supply chain is reduced. Modeling and simulation tools are frequently employed to identify and assess risks as well as mitigation approaches. Advanced planning tools can be employed to rapidly recongure the supply chain in response to a disruption. Moreover, software for well-established assessment techniques, e.g. FMEA, FTA, ETA, exists. The risk management process should be carried out cross-functional and - if possible - together with representatives from all companies of the supply chain.
4.3.2
Risk Management
Additional Resources Brindley, C. (ed.) (2004): Supply Chain Risk A Reader. Ashgate Publishing Limited. Handeld, R., Blackhurst, J., Craighead, C.W. (2007): Supply Chain Risk Management: Minimizing Disruptions in Global Sourcing. CRC press. Modarres, M. (2006): Risk Analysis in Engineering Techniques, Tools, and Trends. Taylor & Francis. She, Y. (2005): The Resilient Enterprise Overcoming Vulnerability for Competitive Advantage. The MIT Press. Ziegenbein, A. (2007): Supply Chain Risk Identication, Assessment and Mitigation. vdf Hochschulverlag Zrich (in German). (2004) A Guide to Project Management Body of Knowledge. PMBOK guide Project Management Institute, Inc (2002). Risk Management Guide for DoD Acquisition Defense Acquisition University US Department of Defense. There is a Supply Chain Council Special Interest Group on Risk Management in SCOR model. Please contact the group at info@supply-chain.org, if you would like to contribute to this topic.
4.3.3
Risk Management
Supply Chain Risk Identication
A key aspect of supply chain risk management is identication. Identication involves creating a list of potential events that could harm any aspect of the supply chains performance. Risk identication allows an organization to take steps to create plans to manage risks before they occur. This is typically more cost eective then waiting to react to adverse events when they occur. Some methods for identifying risk are: Looking at historical problems Historical problems may have a high chance of recurring. Those problems may have happened to the organization itself or to others. Researching industry trends Other organizations and industry groups may have already researched risks that are applicable. Group of experts brainstorming People with experience in dierent areas of your organization and supply chain have lots of knowledge of risks. Getting them together increases the knowledge sharing. Supply chain mapping Visual maps of supply chains reveal supply chain structures, dependencies, and handos that may contain risk. SCOR mapping and Value Stream Mapping are two types of supply chain mapping that can be used. Assessment surveys Well designed surveys can be an eective way to quickly gather information on risks in your supply chain. Site visits Site visits to supply chain partners allow you to collect detailed and less ltered information on risks. Information audits Data system audits can reveal issues and trends from the past. It can show areas of the supply chain that have had poor performance in the past and are thus more likely to perform poorly in the future. Delphi method Risk checklists cause-eect-diagrams and critical path method
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators Any organization interested in managing risks must rst identify them.
4.3.4
Risk Management
Additional Comments In the Plan step of SCOR, an organization can create plans for identifying risk on an ongoing basis. Risks can be classied into Source Risks, Make Risks, Deliver Risks, and Return risks. Source risk identication Standardized source assessments and surveys are eective. Some companies have already developed such assessments. Make risk identication Internal risks to an organization that have been extensively studied and include: Sarbanes-Oxley Compliance; scal, environmental, and social responsibility; health and labor laws; loss of manufacturing capability (due to labor loss, property loss, ...); quality management; increases in production costs; link to source risks (interruptions and increases in costs); capacity (over and under); intellectual property; and personnel management. Deliver risk identication Visibility of customers improves the ability to identify Deliver risks. Return risk identication Data on returns needs to be tracked to identify risks. Excessive returns may reveal risks earlier in the process. Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Experienced Impact Identifying risk is the rst step towards reducing the potential for risk which increases the reliability of the supply chain. None Identied None Identied None Identied None Identied
Key Best Practice Success Factors Technology Features Other Success Factors Additional Resources (2004) A Guide to Project Management Body of Knowledge. PMBOK guide Project Management Institute, Inc (2002). Risk Management Guide for DoD Acquisition Defense Acquisition University US Department of Defense. Hoeft, S., Davey M., Newsome, D., (May-June 2007) Proactively Managing Risk: The New Waste. Defense AT&L. Non Identied Non Identied
4.3.5
Risk Management
Once areas of risk have been identied, an organization needs to monitor their internal and external environment. This helps them to predict when risky events are becoming more likely. It also helps to identify new risks and is tightly linked to the best practice of Supply Chain Risk Identication. SCORs focus on supply chain metrics enables Supply Chain Risk monitoring. Real time metrics and periodic reports give decisions makers knowledge upcoming risks. Statistical analysis of key metrics can reveal trends. Visibility into supplier and customer metrics increases the ability to monitor. Reports on risk monitoring can be combined with existing management reviews and meetings. Monitoring can also include monitoring qualitative sources of information such as news or weather reports to identify events that are precursors to risks. In the Plan step, an organization can plan methods for monitoring Source, Make, Deliver, and Return risks. These methods may include specic metrics to monitor and watch-out lists of precursor events. It may also include monitoring the environment external to the organizations supply chain. Deliver risk monitoring can be done with customer service metrics. Make risk monitoring can be done automatically through an organizations data systems such as an ERP system. Source risk monitoring is enhanced with visibility into suppliers metrics. It is important to monitor indicators that would appear early in a risk event or, better, even before it occurs by indicating an increasing likelihood. If monitoring only reveals a risk well after its rst occurrence, it will likely be too late to adequately respond to it. Monitoring can also be used to test the eectiveness of risk controls. If a plan to mitigate or prevent a risk has been implemented, monitoring can check to see if the corresponding metrics show no signs of the risk occurring.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators Risk monitoring is used when an organization desires to be proactive in risk mitigation and take actions prior to an actual risk occurrence. Additional Comments None Idented
4.3.6
Risk Management
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Monitoring risk will allow the company to be proactive in risk response preventing a disruption from impacting supply chain performance resulting in continuous, reliable delivery. None Identied None Identied If risk is discovered early, then is more potential to prevent it or at least minimize the impact of it on costs. None Idented
Responsiveness Flexibility Costs Asset Management
Key Best Practice Success Factors Technology Features Other Success Factors Automated metrics reporting Automated information collection Risk monitoring programs need to have a clear process for escalating information that would indicate a disruption will or has occurred. This process will ensure that monitoring leads to proper actions being taken.
Additional Resources None Identied
4.3.7
Risk Management
Supply Chain Risk assessment provides management with an understanding of where the greatest risks may exist in order to prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of the risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events. The team can then prioritize addressing the risks. Risk assessment is typically made up of two measures: Likelihood and Impact. Likelihood measures the probability that the event will occur. With formal probability, a likelihood of 0 means the event will never occur and a likelihood of 1 means the event will surely occur. The exact probability may be dicult to determine unless there is historical data that can be used to nd the frequency of the event occurring. Alternatively an organization can use a subjective likelihood, or degree of belief, based on the opinions of experts. A time horizon is necessary to dene the probability in a useful way (e.g., the likelihood that an event will occur in the next year or the likelihood that the event will occur in the next 50 years). Impact measures the consequences on the organization if the event occurs. It can be measured directly, for example in terms of dollars. It can also be measured on a scale, for example from zero to one with zero being very little negative consequence, 0.5 being a medium amount of consequence, and one being a very bad consequence. Methods for measuring impact include what-if simulations, nancial models, and opinions of teams of experts. Impact may also be measured in terms of other SCOR metrics besides nancials. Summary risk score A summary risk score can be calculated for each risk by multiplying the Impact times the Probability to get an expected value of the risk. Then risks can be ranked by risk score. Also the risks can be shown on a map or graph. An example is shown below.
$120,000 $100,000 $80,000
Impact
$60,000 $40,000 $20,000 $0 0 0.2 0.4 0.6 0.8 1
Probability
Other methods for assessment include: - Failure Mode Eects Analysis (FMEA) - Fault Tree Analysis (FTA) - Event Tree analysis (ETA)
4.3.8
Risk Management
A risk assessment tool in the form of qualitative and quantitative spreadsheet which can be used by management teams to organize the assessment of risks to an organization. The tool can contain also contain information on relevant causes of those risks and their assessment, mitigation options and the impact of various mitigation plans. This helps establish standards for the measurement, reporting, and limiting of risk. The tool can contain risk categories from other known best practices such as COSO.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators Risk assessment is a tool for quantifying the potential impact of supply chain disruptions and is a key tool for prioritizing mitigation activities. Risk assessment should be used to increase the veracity of a supply chain risk management program and better support resource allocations. Additional Comments Risk management is widely discussed, but practitioners have diering views of the categories, signicance, and how to integrate mitigation plans into the overall project or operational plan. A frequent issue is that management focuses on the highest impact risks, overlooking more frequent occurrences. This tool should help standardize risk management vocabulary and practices within an organization. Can help embed risk management in the operating and project plan. A best practice is to have project teams update the assessment/ plan as complete project milestones, such as le permits, FEL3,etc. Keeps risk mitigation plan integrated with overall project, such as by eliminate risk mitigation plans which as no longer pertinent. Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Good risk assessments will identify the most signicant risks to be mitigated and, therefore, decrease the likelihood of disruptions to reliability. Improves reliability by facilitating risk mitigation plans. Responsiveness Flexibility Costs None Identied Good risk assessments will identify the most signicant risks to be mitigated and, therefore, increase the ability to increase exibility. Good risk assessments will identify the most signicant risks to be mitigated and, therefore, best allocate cost resources to mitigate risks. Improves cost control by identifying factors which can costs to exceed forecast, and by facilitating risk mitigation plans. Asset Management None Identied
4.3.9
Risk Management
Key Best Practice Success Factors Technology Features Some more sophisticated methods of risk assessment involve the use of simulations to derive approximations for the impact of risks. A variety of dierent types of supply chain simulation software are available and may be used for this purpose. Microsoft Excel software, or equivalent. Other Success Factors Procedure for use of this Best Practice in the context of the rms vocabulary and policies. Standard assessment criteria Training on that procedure for management, risk assessment professionals, and supply chain professionals. Additional Resources (2004) A Guide to Project Management Body of Knowledge. PMBOK guide Project Management Institute, Inc (2002). Risk Management Guide for DoD Acquisition Defense Acquisition University US Department of Defense. Hoeft, S., Davey M., Newsome, D., (May-June 2007) Proactively Managing Risk: The New Waste. Defense AT&L. Failure Mode and eect analysis. Enterprise Risk Management Integrated Framework. Committee of Sponsoring Organizations of the Treadway Commission (COSO)
4.3.10
Risk Management
Sourcing Risk Mitigation Strategies
For most manufacturing operations, over 70% of cost is associated with purchased goods and services. These organizations may identify some goods or services as posing unacceptable supply risk, in case of suppliers business rationalization, excessive demand, re, work outage, etc This best practice identies some Risk Mitigation strategies. Source risk mitigation strategies can include: Multiple sources of supply Strategic agreements with suppliers Supplier partnerships CPFR Joint product design and delivery Etc.
SCOR Process(es) EP.9, ES.9 Best Practice Need Indicators This practice ts well with companies that have a few, signicant supplier or a supplier base that is constrained or powerful. It also is useful of the supplier base or the raw materials purchased are inherently high risk. Additional Comments None Identied Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Technology Features Other Success Factors Additional Resources Various Institute for Supply Management (ISM), other documents. Experienced Impact To improve reliability through appropriate mitigation plans None Identied None Identied By avoiding various negative outcomes, can avoid costs. None Identied None Identied None Identied
4.3.11
Risk Management
Open communication is necessary for eective risk management, where the term open refers to the possibility to directly reach the right person who can better handle the information about a crisis situations wherever in the organization (i.e. refer to the NokiaEricssons case in She, 2005). Managers require direct communication channels up, down and across their business units to help identify risks and take appropriate actions. The communication should also be fast and reliable: suitable methods of communication (from phone call to e-mail messages or even more advanced means) and redundant communication capabilities should be identied. Periodic reports shared within the partners of the supply chain can denitively help in coordinating eorts related to risk management activities and initiatives.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators Open crisis communication is needed when a coordinated response is needed to prevent or respond to supply chain disruptions. Additional Comments This practice aims at smoothing the problems due to lack of communication within companys functions or within dierent companies among the supply chain. Establishing an open, reliable and fast communication channel means allow people to work with the right information in the right place at the right time, in order to ensure coordinated Risk Management activities Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact It improves the reliability by fastening and ensuring communication through the organization and the supply chain so that material ows in a predictable manor. It can help in implementing faster response by reduce the lag between events and people awareness It can help during planning activities providing the most valued information to decision makers within the whole supply chain It can reduce the costs by ensuring prompt and proper reaction to disruptive events, thanks to reliable information sharing within the supply chains partners None Identied
Asset Management
4.3.12
Risk Management
Key Best Practice Success Factors Technology Features Using intranet to communicate the organizations eorts and involve all employees in managing risk. Risk management portal with access for all required partners. Holding quarterly meetings of a risk management committee to review and discuss the organizations exposure and protection measures. Promoting awareness of risk management issues through monthly, quarterly and annual reports. Encouraging people to discuss mistakes.
Additional Resources Best Practices in Risk Management: Private and Public Sectors Internationally Treasury Board of Canada Secretariat. Accessed on 10/25/2007 at http://www.tbs-sct.gc.ca/pubs_pol/dcgpubs/ RiskManagement/rm-pps1_e.asp She, Y. (2005): The Resilient Enterprise Overcoming Vulnerability for Competitive Advantage. The MIT Press.
4.3.13
Risk Management
The process of coordinated risk management places a strong emphasis on cooperation among departments within a single company and among dierent companies of a supply chain to eectively manage the full range of risks as a whole. A closer coordination of risk management activities performed throughout the supply chain is intended to conserve resources and increase eectiveness. The adoption of a common process framework within the supply chain can foster the share of information in order to improve existing initiatives and removal duplicated or ineective activities. Moreover, sharing business continuity programs with supply-side and customerside partners, can help in identifying overlapping areas or uncovered issues. Risk Management coordination could be achieved by the establishment of a Risk Management Coordination Committee, whose purpose is advises and coordinates the identication and inclusion of risk management treatments within the overall risk management process (see, Comcover reference) This practice is at the basis of the shared risk approach.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators Coordinated risk management is essential in situations where a signicant amount of potential risk lies outside of the subject organizations control, e.g., in other business units, upstream in supplier supply chains, or downstream in customer supply chains. In these cases, risk is best mitigated through close coordination with partners that can directly act on the potential risks. Additional Comments One important pre-requisite of coordinated risk management is that supply-side partners should be seen from a collaborative rather than a competitive viewpoint. This in order to share best practices, recovery objectives, strategy information, expectations and mutual aid options. In order to identify critical suppliers, it is possible to send them surveys regarding their business continuity programs. Recurring meetings (some face-to-face) can lead to decreased availability risk and far-greater levels of business continuity program maturity for both organizations. Another important pre-requisite is an appropriate visibility into customer events (i.e. inventory level, sales volume, demand forecasts). This is intended to allow for early detection of risky situations or conditions.
4.3.14
Risk Management
Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Experienced Impact Coordinated action will reduce the potential for overall supply chain disruption and, therefore, provide a better ability to deliver product reliably. Coordination of mitigation and recovery activities can increase the speed of response as well as result in a more coordinated and faster supply chain. Having coordinated response programs in place will speed general communication and coordination across the supply chain, improving the ability to coordinate reactions to surges or decreases in demand. By sharing common activities within the supply chain and removing useless or ineective process, this practice can contribute to cost reduction None Identied - Information sharing and communication systems - Knowledge base management systems Coordinated risk management is most eective when coordination is geared toward shared responses to risk and focused on best meeting customer requirements.
Costs Asset Management Technology Features Other Success Factors
Additional Resources Comcovers Awards for Excellence in Risk Management 2004: National Capital Authority. Australian Government Comcover. Accessed on 10/25/2007 at: http://www.nance.gov.au/COMCOVER/ docs/2004_NCA.pdf
4.3.15
Risk Management
Supply chain business rules congured to mitigate risk
This practice involves establishing business rules (e.g., customer priority, supplier priority, production routing, transportation routing, etc.) based on minimizing the risk to the supply chain. Under this practice, business rules are established or congured in response to the corporate risk management plan with a goal of reducing either the likelihood of a disruption occurring or the impact to the supply chain should a disruption occur. Business rule reconguration typically includes an assessment of the impact of each rule change on the overall supply chain before actual implementation.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators This practice is useful in organizations where the cost of supply chain disruptions is high, either from a prot or brand image perspective. Using a risk mitigation conguration will reduce the potential for a disruption and reduce the recovery time after a disruption occurs. Additional Comments None Identied Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Experienced Impact Designing rules for risk mitigation will reduce the potential for a supply chain disruption improving the overall reliability of delivery. In addition, business rules can keep redundancy in the supply chain to further ensure reliability. Some disruption mitigation approaches (e.g., postponed manufacturing) may improve the responsiveness of the supply chain. By designing rules for mitigating risk, the supply chain is better constructed to redirect capacity in the event of a node failure. This capability will increase exibility. Designing rules for risk mitigation reduces the costs associated with a disruption by providing existing plans for disruption response. Designing rules for risk mitigation reduces the costs associated with a disruption by providing existing plans for disruption response.
Responsiveness Flexibility
Key Best Practice Success Factors Technology Features Other Success Factors Additional Resources None Identied None Identied None Identied
4.3.16
Risk Management
Supply chain information congured to minimize risk
This practice involves managing supply chain information networks to minimize the risk to the supply chain. This includes information sharing with partners as well as internal locations. This helps all parties to be quickly informed of a real or potential disruption and respond quickly and appropriately to minimize the disruption impact. To be eective, this practice needs to include clear identication of what information each supply chain partner needs in order to reduce the overall risk in the supply chain and agreement on information sharing details: Formats Frequencies Technologies Processes
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators This practice is useful in organizations where the cost of supply chain disruptions is high, either from a prot or brand image perspective. Using a risk mitigation conguration will reduce the potential for a disruption and reduce the recovery time after a disruption occurs. Additional Comments None Identied Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Experienced Impact Sharing risk information across the supply chain will minimize the disruption response time and ensure reliable delivery of products and services. Sharing information will minimize disruption response time and speed the delivery of products and services following a disruption. Having set information sharing processes place will speed the response to demand uctuations and other disruptions improving the exibility of the supply chain. None Identied None Identied
Key Best Practice Success Factors Technology Features Other Success Factors Additional Resources None Identied Information sharing protocols (e.g., EDI, XML. Etc.) None Identied
4.3.17
Risk Management
Supply chain network congured to mitigate risk
This practice relies on a risk evaluation of the supply chain to guide the design of the supply chain network. Node locations, transportation routes, capacity size and location, number of suppliers, number of production locations, etc. are all determined in a fashion that mitigates potential disruptions to the ability to deliver product and service to the end customer. This practice relies on the information collected through risk identication and risk assessment processes to identify nodes that are at a high risk of disruption due to the location of the node. Location specic risks can include tactical strike risks, natural disaster risks, single point of failure risks, etc.
SCOR Process(es) EP.9, ES.9, EM.9, ED.9, ER.9 Best Practice Need Indicators This practice is useful in organizations where the cost of supply chain disruptions is high, either from a prot or brand image perspective. Using a risk mitigation conguration will reduce the potential for a disruption and reduce the recovery time after a disruption occurs. Additional Comments This practice generally involves making signicant changes to the supply chain. The changes tend to be very dicult and expensive to undo, therefore, great care should be taken in reconguring the supply chain network. Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Experienced Impact Designing for risk mitigation will reduce the potential for a supply chain disruption improving the overall reliability of delivery Some disruption mitigation approaches (e.g., postponed manufacturing) may improve the responsiveness of the supply chain. By designing for mitigating risk, the supply chain is better constructed to redirect capacity in the event of a node failure. This capability will increase exibility. Designing for risk mitigation reduces the costs associated with a disruption by locating inventory and other assets outside of high risk geographic areas. Designing for risk mitigation reduces the costs associated with a disruption by locating assets outside of high risk geographic areas.
4.3.18
Risk Management
Key Best Practice Success Factors Technology Features A risk enabled supply chain network will often rely on network modeling as well as electronic order routing and EDI links between facilities and partners. This practice will be most successful when coupled with other risk management practices such as coordinated programs and visibility of risks.
Other Success Factors Additional Resources None Identied
4.3.19
Risk Management
Sourcing Opportunities Prioritization to Improve Cost & Security of Supply
Many businesses need to improve performance through reliable Sourcing of more costeective supplies & services to meet customers needs and growth opportunities. This Best Practice covers strategic sourcing approaches for reducing Total Cost of Ownership, and simultaneously assessing supply risk in case of business rationalization, excessive demand, re, work outage, etc
SCOR Process(es) ES.9, EP.9 Best Practice Need Indicators For organizations which use goods and services in a variety of uses, making it more dicult to determine which goods and services deserve priority for cost improvements and risk mitigation. Additional Comments None Identied Impact on Supply Chain Performance Attributes/Metrics Attribute Reliability Responsiveness Flexibility Costs Asset Management Experienced Impact To improve reliability through appropriate mitigation plans. None Identied None Identied Helps prioritize improvement eorts. None Identied
Key Best Practice Success Factors Technology Features Data from ERP system on goods and services and where used. Data form ERP system on revenues associated with specic oerings where above goods and services are used. Management support.
Other Success Factors Additional Resources
Strategic sourcing references on demand identication, ABC and Risk Analysis, Stakeholders analysis, and demand segregation per the training materials.
4.3.20
Section 5 Special Applications
GreenSCOR
Introduction
Sustainable business models and environmental accounting are growing business concerns. However, there are multiple approaches to measuring the total environmental footprint of an organization or supply chain with no agreed upon standards. The SCOR Model, which is a proven framework for de ning supply chain scope and process operations as well as measuring supply chain performance, provides an excellent foundation for environmental accounting in the supply chain. In that regard, the Supply Chain Council is proposing a set of strategic environmental metrics that can be added to the SCOR Model to e ectively allow the SCOR Model to be used as a framework for environmental accounting. The proposed metrics are listed in the table below. Metric Carbon Emissions Units Tons CO2 Equivalent Basis This is the unit of measure currently used for green house gas emissions and is a measure of the climate impact from CO2 and other global warming air emissions. This would include emissions of major air pollutants (COx, NOx, SOx, Volatile Organic Compounds (VOC) and Particulate). These are the major emissions that U.S. EPA tracks. This includes liquid waste that is either disposed of or released to open water or sewer systems (these emissions are generally listed on water emissions permits). The total solid waste generated by the process. The per cent of the solid waste that is recycled.
Air Pollutant Emissions
Tons or kg
Liquid Waste Generated
Tons or kg
Solid Waste Generated % Recycled waste
Tons or kg Per cent
These ve metrics can be measured for each of the SCOR Level 3 processes and then aggregated to create a Level 2 and Level 1 metric. These metrics are readily available for most organizations. Environmental agencies and industry associations have developed emissions factors based on process throughput, energy consumption, etc. for calculating these emissions. Alternatively emissions values can be directly collected through monitoring programs or common documents (e.g., regulatory reports, waste shipping documents, environmental permits, etc.). By adding these metrics to the SCOR Model, an organization can use the existing SCOR based methods for de ning supply chain scope and con guration. Once that process is complete, these metrics allow for targeted, structured data collection and calculation of metrics which ultimately provide a total view of supply chain environmental performance. The gure below illustrates the aggregation of these metrics along the SCOR process structure.
5.1.1
GreenSCOR
Level 1
Total Carbon Footprint Air+Liquid+Solid-% Recyc=Total Environmental Footprint
Tier 3
S1
Tier 2
M1 D1 S1
Tier 1
M1 D1
Your Company
S1 M2 Carbon Air Liquid Solid % Recyc D2
Customer
S2
Level 2
D1 S1 M1 D1 S1 M1 D1
M2.1
M2.2
Issue Product
M2.3
Produce and Test
M2.4
Package
M2.5
Stage Product
M2.6
Level 3
Schedule production Activities
Carbon Air Liquid Solid % Recyc
Using the SCOR Model as an environmental accounting framework has additional bene ts as well. First, the framework clearly ties the various emissions to the originating processes. This provides a structure for not just measuring performance, but identifying where action can be taking to improve performance. Second, the hierarchal nature of the SCOR Model allows for strategic environmental footprint goals to be easily translated to targets in speci c activities. Likewise, when strategic goals are not being met, the framework provides a structure for root cause analysis as well as end-to-end supply chain optimization around environmental performance. Lastly, as with other SCOR Model metrics, these metrics have clear de nitions and a tie to process activities that provide a foundation for e ective benchmarking. This capability allows companies to compare environmental performance of their supply chain using the same methods currently used for comparing business performance. Through benchmarking, managers can go beyond measuring environmental performance and understand that performance in the context of their industry peers performance. The remainder of this appendix details these environmental metrics and their decomposition levels in the same format used elsewhere in the SCOR Model. The Supply Chain Council believes that this metrics structure provides an e ective tool for environmental supply chain accounting. However, this approach is not currently in use, and, therefore, these metrics are not included as fully approved SCOR metrics. Please provide feedback to the Supply Chain Council on the e ectiveness of this metrics structure as it is applied to your supply chain operations.
5.1.2
GreenSCOR
Performance Attribute: Supply Chain Costs Total Supply Chain Carbon Footprint
The sum of the carbon equivalent emissions associated with the SCOR Level 2 processes to Plan, Source, Make, Deliver, and Return.
Level 1
Total Supply Chain Carbon Footprint
Plan Carbon Emissions Source Carbon Emissions Level 2 Make Carbon Emissions Deliver Carbon Emissions Return Carbon Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Total Supply Chain Carbon Footprint = Plan Carbon Emissions + Source + Make + Deliver + Return Calculation Total Supply Chain Carbon Footprint = sum of emissions from energy and fuel consumption and process related emissions Data Collection Carbon emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, a supply chain represents partial use of a facility, production line, vehicle, etc. Therefore, the carbon emissions from this infrastructure must be apportioned based on the proportional use of the supply chain.
5.1.3
GreenSCOR
Performance Attribute: Supply Chain Costs Plan Carbon Emissions
Process Number: P1, P2, P3, P4, P5 The sum of carbon emissions associated with Plan.
Level 1 Level 2
Plan Make Carbon Emissions Plan Carbon Emissions Plan Supply Chain Carbon Emissions Plan Source Carbon Emissions
Level 3
Plan Make Carbon Emissions Plan Deliver Carbon Emissions Plan Return Carbon Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Plan Carbon Emissions = Sum of Plan Carbon Emissions (Plan + Source + Make + Deliver + Return) Calculation Plan carbon emissions can be calculated using published emission factors. In most organizations, the Carbon emissions from the planning process will consist exclusively of energy consumed to support planning tools and infrastructure, including facilities. Data Collection Carbon emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, energy consumption will have to be allocated to various processes based on factors such as square footage, unit volume, revenue, or other factors.
5.1.4
GreenSCOR
Process Number: S1, S2, S3 The sum of the carbon emissions associated with Source.
Performance Attribute: Supply Chain Costs Source Carbon Emissions
Level 1 Level 2
Total Supply Chain Management Carbon Footprint Source Carbon Emissions Supplier Management
Level 3
(See processes under Source)
Material Aquisition Management

(See processes under Source)
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Source Carbon Emissions = Sum of Carbon Emissions for (Supplier Management + Material Acquisition Management) Calculation Supplier Management = material planning + planning procurement sta + supplier negotiation and quali cation + etc. Material Acquisition Management = bidding and quotations + ordering + receiving + incoming material inspection + material storage + payment authorization + sourcing business rules and rqmts. + inbound freight and duties + etc. Data Collection Carbon emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, energy consumption will have to be allocated to various processes based on factors such as square footage, unit volume, revenue, or other factors.
5.1.5
GreenSCOR
Performance Attribute: Supply Chain Costs Make Carbon Emissions
Process Number: M1, M2, M3 The sum of the carbon emissions associated with Make.
Level 1 Level 2
Total Supply Chain Management Carbon Footprint Make Carbon Emissions
Level 3
Indirect Emissions Related to Production Direct Production Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Make Carbon Emissions = Sum of Direct Labor, and Direct non-Material Product-related Cost (equipment) and of Indirect Product-related Cost Calculation None Identi ed Data Collection Carbon emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, energy consumption will have to be allocated to various processes based on factors such as square footage, unit volume, revenue, or other factors.
5.1.6
GreenSCOR
Performance Attribute: Supply Chain Costs Deliver Carbon Emissions
Process Number: D1, D2, D3
The sum of the carbon emissions associated with Deliver and/or Install
Level 1
^
Level 2
Total Supply Chain Carbon Footprint Deliver Carbon Emissions Sales (order) Management
Level 3
(See processes under Deliver)
(See processes under Deliver)
Customer Management
Qualitative Relationship Description None Ident ed Quantitative Relationship (optional, if calculable) Deliver Carbon Emissions = Sum of Carbon Emissions of ( Sales order management + Customer Management ) Calculation Sales order management = inquiry & quotations + order entry & maintenance + channel management + order ful llment + distribution + transportation + outbound freight and duties + installation + customer invoicing / accounting + new product release / phase-in + etc. Customer Management = nancing + post-sales customer service + handling disputes + eld repairs + enabling technologies + etc. Data Collection Carbon emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, energy consumption will have to be allocated to various processes based on factors such as square footage, unit volume, revenue, or other factors.
5.1.7
GreenSCOR
Performance Attribute: Supply Chain Costs Return Carbon Emissions
Process Number: SRx, DRx
The sum of the carbon emissions resulting from returning a product to the supplier.
Level 1
^
Level 2
Total Supply Chain Carbon Footprint Return Carbon Emissions
Level 3
Source Return Carbon Emissions Deliver Return Carbon Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Cost to Return = Sum of Cost to Return ( to Sources + from Customers ) Calculation Cost to Return to Source (SRx) = Verify Defective Product Emissions + Disposition of Defective Product Emissions + Identify MRO Condition Emissions + Request MRO Return Authorization Emissions + Schedule MRO Shipment Emissions + Return MRO Product Emissions + etc. Cost to Return From Customer (DRx) = Authorization Emissions + Schedule Return Emissions + Receive Emissions + Authorize MRO Return Emissions + Schedule MRO Return Emissions + Receive MRO Return Emissions + Transfer MRO Product Emissions + etc. Data Collection Carbon emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, energy consumption will have to be allocated to various processes based on factors such as square footage, unit volume, revenue, or other factors.
5.1.8
GreenSCOR
Performance Attribute: Supply Chain Costs Total Supply Chain Environmental Footprint
The sum of the air, liquid, and solid waste emissions associated with the SCOR Level 2 processes to Plan, Source, Make, Deliver, and Return.
Level 1
Total Supply Chain Environmental Footprint
Total Supply Chain Air Emissions Level 2 Total Supply Chain Liquid Emissions Total Supply Chain Solid Waste Emissions % Waste Recycled
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Total Supply Chain Environmental Footprint = Total Supply Chain Air Emissions + Total Supply Chain Liquid Emissions + (Total Supply Chain Solid Waste Emissions * (1 - % waste recycled)) Calculation Total Supply Chain Environmental Footprint = sum of air, liquid, and solid waste emissions from energy and fuel consumption and process related emissions less the sum of waste that is e ectively recycled. Data Collection Emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations as well as direct waste stream measurement. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources (e.g., smoke stacks or waste generating processes). Discussion Often, a supply chain represents partial use of a facility, production line, vehicle, etc. Therefore, the emissions from this infrastructure must be apportioned based on the proportional use of the supply chain.
5.1.9
GreenSCOR
Performance Attribute: Supply Chain Costs Total Supply Chain Air Emissions
The sum of the Air emissions associated with the SCOR Level 2 processes to Plan, Source, Make, Deliver, and Return.
Level 1
^
Level 2
Total Supply Chain Environmental Footprint Total Supply Chain Air Emissions Plan Air Emissions Source Air Emissions
Level 3
Make Air Emissions Deliver Air Emissions Return Air Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Total Supply Chain Air Emissions = Plan Air Emissions + Source + Make + Deliver + Return Calculation Total Supply Chain Air Emissions = sum of emissions from energy and fuel consumption and process related emissions Data Collection Air emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on energy consumption, fuel type and consumption, or process throughput. Alternatively, actual emissions can be monitored from discrete sources . Discussion Often, a supply chain represents partial use of a facility, production line, vehicle, etc. Therefore, the emissions from this infrastructure must be apportioned based on the proportional use of the supply chain.
5.1.10
GreenSCOR
Performance Attribute: Supply Chain Costs Total Supply Chain Liquid Emissions
The sum of the Liquid emissions associated with the SCOR Level 2 processes to Plan, Source, Make, Deliver, and Return.
Level 1 Level 2
Total Supply Chain Environmental Footprint Total Supply Chain Liquid Emissions Plan Liquid Emissions Source Liquid Emissions
Level 3
Make Liquid Emissions Deliver Liquid Emissions Return Liquid Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Total Supply Chain Liquid Emissions = Plan Liquid Emissions + Source + Make + Deliver + Return Calculation Total Supply Chain Liquid Emissions = sum of emissions from process related emissions Data Collection
Liquid emissions are generally calculated using emission factors such as those created by the U.S. Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on process throughput. Alternatively, actual emissions can be monitored from discrete sources.
Discussion Often, a supply chain represents partial use of a facility, production line, vehicle, etc. Therefore, the emissions from this infrastructure must be apportioned based on the proportional use of the supply chain.
5.1.11
GreenSCOR
Performance Attribute: Supply Chain Costs Total Supply Chain Solid Waste Emissions
The sum of the solid waste emissions associated with the SCOR Level 2 processes to Plan, Source, Make, Deliver, and Return.
Level 1 Level 2
Total Supply Chain Environmental Footprint Total Supply Chain Solid Waste Emissions Plan Solid Waste Emissions Source Solid Waste Emissions
Level 3
Make Solid Waste Emissions Deliver Solid Waste Emissions Return Solid Waste Emissions
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Total Supply Chain Solid Waste Emissions = Plan Solid Waste Emissions + Source + Make + Deliver + Return Calculation Total Supply Chain Solid Waste Emissions = sum of emissions from process related emissions Data Collection
Solid Waste emissions are generally calculated using emission factors such as those created by the U.S.
Environmental Protection Agency, National Environmental Research Laboratory, and various industry associations. The emission factors are generally based on process throughput. Alternatively, actual emissions can be monitored from discrete sources. Discussion Often, a supply chain represents partial use of a facility, production line, vehicle, etc. Therefore, the emissions from this infrastructure must be apportioned based on the proportional use of the supply chain.
5.1.12
GreenSCOR
Performance Attribute: Supply Chain Costs Total Supply Chain % Recycled
The portion of the solid waste e ectively recycled or reused associated with the SCOR Level 2 processes to Plan, Source, Make, Deliver, and Return.
Level 1 Level 2
Total Supply Chain Environmental Footprint Total Supply Chain % Recycled Plan % Recycled Source % Recycled
Level 3
Make % Recycled Deliver % Recycled Return % Recycled
Qualitative Relationship Description None Identi ed Quantitative Relationship (optional, if calculable) Total Supply Chain % Recycled = (Plan % Recycled * Plan Solid Waste Emissions + Source % Recycled * Source Solid Waste Emissions + Make % Recycled * Make Solid Waste Emissions + Deliver % Recycled * Deliver Solid Waste Emissions + Return % Recycled * Return Solid Waste Emissions) / Total Supply Chain Solid Waste Emissions Calculation Total Supply Chain % Recycled = Total Supply Chain Solid Waste Emissions that are E ectively Recycled / Total Supply Chain Solid Waste Emissions Data Collection The amount of solid waste that is recycled is generally available through process records for reuse or invoices or bills of lading from recycling partners. Discussion This metrics is intended to measure the waste that is actually recycled rather than the waste that can be recycled. It is intended to re ect the true current environmental performance of the supply chain.
5.1.13
5.1.14

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SCOR

Supply Chain Operations Reference Model

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Figure 1 - SCOR is organized around ve major management processes.

Copyright 2008 Supply Chain Council Inc.

Supply-Chain Operations Reference Model

Conguration Level (Process Categories)

Process Element Level (Decompose Processes)

Identify, Prioritize, and Aggregate Supply-Chain Requirements

Identify, Assess, and Aggregate Supply-Chain Requirements

Balance Production Resources with SupplyChain Requirements

Establish and Communicate Supply-Chain Plans

Implementation Level (Decompose Process Elements)

Figure 2 - SCOR is a hierarchical model with specic boundaries in regard to scope.

Copyright 2008 Supply Chain Council Inc.

Business Process Reengineering

Best Practices Analysis

Process Reference Model

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Performance Attributes and Level 1 Strategic Metrics

Performance Attributes Level 1 Strategic Metrics

Customer-Facing Responsiveness Agility

Internal-Facing Costs Assets

Performance Attributes and Associated Level 1 Metrics

Supply Chain Responsiveness Supply Chain Agility

Supply Chain Costs Supply Chain Asset Management

The costs associated with operating the supply chain.

Supply Chain Management Cost (CO.1.1) Cost of Goods Sold (CO.1.2)

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Figure 6, Summary of process number changes

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Section/Chapter Description Introduction Plan Source Make Deliver Return

Accompanies the process No longer applicable

Section 3 Section 2 Section Section 3, Chapter 6

Processes Metrics Best Practices Inputs and Outputs

Section 2 Section 4 Section 5

Metrics Best practices Special Applications

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

RL.1.1 Perfect Order Ful llment RL.2.1 % of Orders Delivered in Full

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

Copyright 2008 Supply Chain Council Inc.

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% Orders Received Damage Free % Faultless Installations Warranty & Returns

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M1.6: Release Product to Deliver

D4.5: Fill Shopping Cart ES.5: Manage Capital Assets

EM.8: Manage Make Regulatory Environment

Copyright 2008 Supply Chain Council Inc.

M2.6: Release Finished Product to Deliver

M2.6: Release Finished Product to Deliver