Performance Indicators for the Supply Chain - Supply Chain Management

Supply Chain Performance Indicators

The indicators of the performance of the supply chain (Table 2.3) in SCOR conditionally divided into two groups.

1. The performance of the chain is performance attributes. Performance indicators are grouped metrics used to set the direction of the CPU strategy. In themselves, performance indicators can not be measured, they only set the direction of the strategy.

There are five groups of performance indicators in the SCOR model.

Reliability of supplies in the chain while ensuring the delivery of the right product, at the right time and place, in proper condition and packaging, of the right quantity, with the correct documentation, the right consumer.

Supply Chain Response - the speed of the goods passing through the supply chain to the consumer.

Maneuverability ( dynamism ) supply chain - the rate at which the supply chain responds to changes in the market situation in order to obtain or retain competitive advantages.

Costs of the supply chain - costs associated with operations in the supply chain.

Asset management in the supply chain - the effectiveness of asset management in meeting demand (includes management of all types of assets: fixed assets, inventories, working capital).

Performance indicators are conditionally divided into two categories: external (customer-oriented) and internal (focused on the business processes of the focus company).

2. Metrics (Measured Metrics System) - metrics. Metrics are designed to assess the possibility of achieving strategic decisions, indicated in terms of performance indicators of the chain. A metric is an established standard for evaluating an activity or process. SCOR metrics are used to diagnose supply chain problems. The SCOR model allocates three levels of metrics (indicator groups).

Level 1 contains indicators that diagnose the overall condition of the supply chain. Also known as strategic metrics or groups of key performance indicators (KPIs). A comparative analysis of these first-level indicators helps in setting realistic goals and objectives for the chosen strategic direction.

Level 2 includes metrics that in turn are diagnostic for the metrics of the first level and help to identify the reasons for the deviation of the planned values.

Level 3 contains metrics that respectively serve to diagnose second-level metrics.

All the metrics from the first to the third level of the SCOR-model have a hierarchical structure. Decomposition helps to identify the factors that caused the deviations of indicators from planned

Table 2.3. Supply Chain Performance Score Structure

Circuit Function Parameter Group

The first level of metrics

Indicator

Description

Indicator

Description

External

RL

Reliability

Supply chain reliability

RL 1.1

Perfect Order

Perfect order fulfillment

RS

Response Speed ​​

Supply chain responsiveness

RS.1.1

Duration of the order execution cycle

Order fulfillment cycle time

AG

Maneuverability

(dynamism)

Supply chain agility

AG.1.1

Supply chain flexibility level (up)

Upside supply chain flexibility

AG.1.2

Supply Chain Adaptability Level (up)

Upside supply chain adaptability

AG.1.3

Supply Chain Adaptability Level (down)

Downside supply chain adaptability

AG.1.4

Total cost measure of risk

Overall value at risk

Internal

CO

Costs

Supply chain costs

CO.1.1

Supply Chain Management Costs

Supply chain management cost

CO.1.2

Cost of goods sold

Cost of goods sold

AM

Assets

Supply chain asset management

AM.1.1

Asset turnover

Cash-to-cash cycle time

AM.1.2

Profitability of non-current assets

Return on supply chain fixed assets

AM.1.3

Profitability of current assets (working capital)

Return on working capital

values, which in the future are subject to more thorough investigation.

In accordance with the recommendations of the Supply Chain Management Council, the supply chain assessment map must contain at least one metric for each performance indicator of the company in order to make the most balanced management decision.

Let's consider in more detail the definition and methodology for calculating the basic indicators of the efficiency of the supply chain according to the SCOR model (version 10.0).

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