CoBI Workshop, 17th IEEE Conference on Business Informatics 13th - 16th July 2015

A REFERENCE MODEL BASED DESIGN OF SUPPLY CHAIN MANAGEMENT CAPABILITIES

Jānis Grabis Information Technology Institute, Riga Technical University, Kalku 1, Riga, Latviagrabis@rtu.lv

Solvita BērzišaInformation Technology Institute, Riga Technical University, Kalku 1, Riga, Latviasolvita.berzisa@rtu.lv

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Outline

• Problem area and objective• Supply chain design and capabilities• SCOR to capabilities mapping• Capability design process• Example• Conclusion

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Problem Area

• Supply chain design• SCOR model• Transition from supply chain domain

to enterprise applications domain

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Objective

• SCOR model is a useful source of information for designing capabilities

• Objective is to identify commonalities among the reference model and capability design and to outline the reference model based capability design

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Supply Chain Design

• Selection of supply chain units, establishing links among the units and configuration of supply chain processes– E.g., Huang et al. (2005)

• SCOR model defines high level processes according to the source, make, deliver and plan template

• Multi-objective design problem– E.g., Melo et al. (2009)

• Global operations – E.g., He et al. (2014)

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Supply Chain Capabilities

• Capabilities describe abilities possessed by an organization– This ability should be achieved under

specified performance requirements and operating conditions

• Supply chain capabilities– Functional capabilities– Service capabilities– Cross-sectional capabilities

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Capability Modeling

class Capability

Capability Goal IndicatorContext

Pattern Process Process Variant

* 1..*

1..*0..*

1..* 1

0..*1..*

0..*

0..*

1..* 0..*

10..*

1..*1..*

Contex represents varying supply chain execution circumstances

Process variants represent supply chain execution solutions

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Supply Chain Reference Model

SCOR defines supply chain processes in a uniform manner

class Asdenca2

Process Performance Attribute

Metric

Best Practice Feature

Input

Output

1..* 0..*

1..* 1..* 1..* 0..*1..* 0..*

1..*

0..*

0..*

1..*

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Mapping

SCOR

Level 1 process

Level 3 process

Best practice

Performance attribute

Metric

Capability

Process

Process variant

Pattern

Goal

Indicator

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Capability Design Process

Apply patterns to operationalize the process variants

Search patterns

Specify capability indicators

Select process variants (Level 3)

Select a process (Level 1) supporting capability delivery

Context modeling

Name capability and define goals

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Example

• Demand fulfillment capability– Based on the delivery process– Uses Deliver Stocked Product (D1) and

Deliver Make-to-Order (D2) process variants

– Pattern repository contains several capability delivery patterns

Demand Fulfillment Capability

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class Example

Demand fulfillment :Capability

To improv e reliability :Goal

To increase responsiv eness :Goal

To reduce costs :Goal

Customer location :Context

Destination conditions :Context

Inquiry source :Context

Customer creditworthiness :

Context

Deliv er :Process Deliv er Stocked Product :Process Variant

Deliv er Make-to-Order Product :Process Variant

Apply patterns to operationalize the process variants

Search patterns

Specify capability indicators

Select process variants (Level 3)

Select a process (Level 1) supporting capability delivery

Context modeling

Name capability and define goals

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Patterns

Name Description Process fragmentSingle point of contact

Problem: Customer requests received through various channels get lostContext: Customer profile, Inquiry sourceSolution: All request are routed for processing in a single view

Tailor offeringProblem: Customers should not be offered products, which cannot be deliveredContext: Customer location, Destination, Product typeSolution: Filter products according the context values

Extra insurance

Problem: Some shipments are dangerous and require extra precautionary measuresContext: Customer location={R1- R5}, Destination conditions={Normal, Hazardous}Solution: Insure high risk shipments

Route request

Select products

Create quotation

Display products

Multi-channel request is received

Filter list

Take extra insurance

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Deliver Stocked Products Process Variant

D1.1 Process inquiry & Quote

D1.1 Process Inquiry & Quote

D1.2 Receive, Enter & Validate Order

D1.3 Reserve Inventory &

Determine Delivery Date

D1.4 Consolidate Orders

D1.5 Plan & Build Loads

D1.6 Route Shipments

D1.7 Select Carriers & Rate Shipments

D1.8 Receive product at warehouse

D1.9 Pick Product

D1.10 Load Vehicle Generate Ship docs, Verify Credit & Ship

Product

D1.11 Receive & Verify Product at

Customer Site

D1.12 Install Product

D1.13 Invoice

Ctx: Customer locationInquiry source

Ctx: Destination conditions

Ctx: Customer creditworthiness

Customer inquiry received

Filter product list

CTx: Customer location

Display products

Select products

Create quote

Route request

CTx: Request source

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Conclusion

• SCOR model provide building block for developing capabilities

• Capabilities allow for contextualiation of supply chain processes

• SCOR model provides Level 1-3 specifications while patterns are used for Level 4