Supply Chain Council: growing, branching out
Now numbering 400-plus member firms, the Council unveils its latest modeling tool, tells of plans in Europe and Japan.
By Staff -- Modern Materials Handling, 11/1/1998
SAN FRANCISCO-The Supply-Chain Council (SCC)-as member organization and as nexus for a cross-industry model to analyze strategic issues and improve operations for a company's suppliers and customers, its efficiencies, and competitiveness-is developing rapidly.What began just two years ago with some 69 member companies in 1996 has grown to a Council with more than 400 firms as of the Fall conference held here. SCC's principal "product," the Supply-Chain Operations Reference-model (SCOR), now has evolved to a revision 3.0, reports Vinay Askegar, SCC's SCORboard chairman.
ANSI (American National Standard Institute) also has authorized SCC to work toward and develop a standard around this latest SCOR model, observes Bill Hakanson, Council executive chairman. There's talk, too, about SCC pursuing ISO certification for the model. A Japanese chapter linked to the Council also is underway, as is one for Europe.
What's the SCOR?
Just what is the SCOR model? It's a generic, cross-industry model that is detailed and complex, says Greg Girard, senior analyst, Advanced Manufacturing Research, Boston. It was developed by 75 leading manufacturers working with Pittiglio Rabin Todd & McGrath and AMR.
Here's the concept: Through examining its supply-chain activities in the SCOR model, a company can more readily grasp where the opportunities are to manage operations better, and take steps to improve and simplify where possible or feasible.
Take, for example, a hypothetical firm, Beta Corp. This California-based firm (see map p. 20) designs, manufactures, distributes, and repairs consumer electronic products. In its core lines, the company has been number one in U.S. market share. Beta has had a presence in more than 50 other nations.
Even so, Beta has incurred losses of 20% of revenues. Its presence in 50 other countries grossed less than 10% of total revenues. More than 50% of its products were designed by others. And, despite Beta's core competency in manufacturing, more than 70% of its products are made by other original equipment manufacturers.
Management took action to simplify the supply chain including consolidating factories and distribution centers, reducing the number of distinct channels to deliver product, cutting dramatically its suppliers and its reliance on OEM product. Beta also moved to link itself more closely with high-volume customers. And it switched from a make-to-stock operation to a make-to-order company to improve its supply chain flexibility and response time while also trimming its inventory investment.
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