I interviewed Imaad Rashid who discussed Using the SCOR Framework as a Practical Framework to Benchmark and Improve Supply Chain Structures.
Looking forward today to hearing your views on using the SCOR framework as a practical framework for the benchmark in improved supply chain structures. My first question is can you explain what is the SCOR framework?
The SCOR framework is basically a kind of skeletal structure that works across any goods and services industry and it’s basically been put together by a group of corporations and defined really and it’s run, and the iterations [ph] are improved by the Supply Chain Council, the SCC which is now part of APICS of course and they’ve merged now. My understanding of a SCOR or my appreciation of SCOR is that it’s basically, a lot of the times within corporations, the review of how supply chain is structured or should be structure for their industry can be fairly subjective. And they don’t necessarily have a frame of reference to go to and say, “Okay guys, how do we structure our organization or how do we structure our processes? What are the matrix that we need to do?” They would, usually the extent to the benchmarking that they will go to is they will look at other corporations operating in the industry that they’re working on and try and leverage off the best examples of success that they can see there.
There was a lack and a need for something that would run across industries as a general framework for what could define success for your supply chain department and it wouldn’t necessarily mean that something that works well in the electronics industry would work well in the manufacturing industry would work well in the financial services industry. But they work on the general principle that the, on how processes should be structured, on how performance should be structured, on people and on practices.
It’s a skeletally structure that you have to refer to in relation to how your organization works so it’s not a shopping list, it’s not something that you go to and pick out while do everything that’s in SCOR, you basically have to map out your processes, your business structure and then SCOR is something that you can reference to to improve on that and to use that to benchmark in that on iterations that would make sense, so yeah. And then we are fusing [ph] that of course. It’s a very powerful application, heavy tool. I had the privilege of using it in a number of companies now. Personally, I’m a real believer that it’s a very useful tool for developing the supply to an organization.
Can you talk more about how it can help?
Basically, there are many different ways of using SCOR. Traditionally, when the Supply Chain Council certifies you for, as a SCOR professional on their own formal courses, they tend to do a very high level process called the SCOR project and that would be driven more down from the C suite level on how the company strategy, its different supply chains need to be aligned. There’s a definite top down way of looking at your organization and basically, the way that would work is you would start off by looking at the SCOR metrics, so SCOR has four or five key and they call them attributes, the agility, responsiveness, reliability, the asset management and cost.
Basically, the idea around SCOR is that you would target what is the level of excellence that I need within each of these attributes? Am I okay with being mid of the range, median [ph] in terms of agility but what I want my company is that the reliability and responsiveness needs to be really high? And then you work backwards from there to see, okay, if my reliability and responsiveness needs to be top of class, what do I need to do in terms of practices, in terms of processes and SCOR gives you a really strong structure to do that so it’s a tool that you can use to strategize, how the company should be structured top down. It can also be used at the absolute tactical level where I can go to SCOR and I’m using this within my current company as well where for example, I have, I am setting up and looking at process we’re engineering for my import warehousing.
And the import warehousing process at the moment will change dramatically because of the infra investment that we are anticipating. Because of the automation that would come in, the process will change and then the, or the practices will change and I’m using SCOR to help define the individual steps of the business process map and I’ll gain, there’s an entire toolkit on how you do this within SCOR. For example, SCOR can give you what is possible inputs and outputs into a process and you could look at your process step and see, well, this particular process step relates to a similar process step within SCOR. It could potentially have these inputs and these outputs. Am I missing out on certain due diligence or checks that I need to do prior to that activity and is there some output from that that I could use to measure the process that I’m not doing? From the absolute tactical level to the absolutely strategic level, SCOR gives you a very diverse toolkit on how to work on your supply chain structures.
Where have you seen some success?
For example again, this is more at the tactical level in terms of process reengineering. I was part of MNC [ph] operating out of Australia where they were restructuring certain operations and we’re looking to outsource some of the source inflections to Indonesia. And a big part of that success in how those processes change was driven by SCOR. If they had simply translated the processes as they were in Australia, you’d say, okay, we just pick up these activities and ship them off to Indonesia.
The process would have been a lot less rigorous than when they said, “Okay, these are our assets. This is the idea of state as defined by SCOR and this is the future state as we can possibly bring it to immediate thought [ph] and then maybe we can push it towards the ideal state in the future.” And so with SCOR, it would give a much more diverse checklist on what the individual process steps you’ll have [ph] taken into account. What are the KPIs that you could potentially measure for those processes? And so it has a much more holistic cross-industry benchmarking input [ph] into defining a specific business process and that’s an absolute tactical example. But the decision to, for example change from Australia to Indonesia in terms of the sourcing of certain products and the manufacturing of certain products could be driven at the most strategic level setting at the regional hub [ph].
They could, for example, use SCOR to say, okay, I need more reliability and responsiveness so how does my overall supply chain look at the global level if these are really [indiscernible 0:08:56] for me, that means I maybe need to take a best practice out of SCOR and that’s maybe, reason [ph] of manufacturing or maybe I need to do manufacturing somewhere. And out of that thought [ph] process would come certain decisions. The idea is that it could drive to strategic decisions that lead to big changes in how the organization works and on the tactical level on how those are actually implemented or work well. SCOR has defined a more structured way of approaching how the process is reengineered as well.
Do you have any final recommendations?
I think the big part with corporates is, or corporations is usually, very often, you could have a lot of in-house standard and they would come across with a recommendation. If the same thing was to come across from an external construction [ph], unfortunately the external consultant [ph], because you’re paying him quite a bit, he comes with a lot of pedigree [ph], sometimes, it could be the same thing but because it has a greater ring [ph] of credibility to it, you would go along and say, “Okay, yeah, that works well.” At the department level or a country level, to convince your regional board, or from a regional board to convince the global HQ, sometimes, when you’re working on something as well on [indiscernible 0:10:34] the SCOR to define your process of [indiscernible 0:10:36] structuring the process. This way, because these are …
The final recommendation would be to use SCOR primarily as a way of, a kind of well-defined, well-reputed credible source for defining critical changes in your company’s supply chain structures or processes for the simple reason that individuals within the company’s record [ph] recommend certain changes but they wouldn’t come across with the same ring [ph] of credibility as an external consultant company like Boston [indiscernible 0:00:45] for example coming across and telling you this is what you need to do because they simply have a greater pedigree [ph] in advising for those changes and SCOR has that pedigree to it in terms of skeletal structure that works well for different businesses that have implemented SCOR and SCOR implementations have been a big part of differentiating those companies and usually, that is seen translating the business results.
The SCC usually publishes three companies that would have implemented SCOR well and have used their digital significant successes. In Pakistan, we had a SCOR implementation by Pakistan Tobacco around 2005 or ’06, a decade back almost. And that interestingly has, is of similar time period to when they’ve pretty much taken over the tobacco industry in Pakistan. The implementation of SCOR seems to coincide with a significant improvement in their business results.
Not only does it seem to have a proven track record when companies that have implemented it well, but it also is a better way of structuring your processes or organization because when you are selling it to the board or selling it upwards to the C suite, it comes across with a greater ring of credibility. And of course, there’s the branding opportunity for the company if they are affiliated with the SCC and proven to be, have one of the more neutrally recognized qualities of lighting structure [ph]. There’s a lot of opportunities in implementing SCOR but rather than the glory, I would focus on the fact that it actually works. It’s application-centric and it is going to take a lot less effort for supply chain managers to convince their organizational hierarchy that, “Guys, these are the changes we need to make to be equipped for the future.”
Thank you. Can you, my last question is can you provide a brief background of yourself?
I’m basically a supply chain professional. I’ve worked across a number of industries. I’m not actually, by professional, I’m a mechanical engineer but my passion is definitely now supply chain. I work in the agrichemical industry with a Swiss corporation Syngenta. I have spent some time working within tobacco, with a company called Philip Morris and I’ve had the opportunity to be based in various parts of the world with them particularly in Australia and Pakistan. I currently work for the [indiscernible 0:03:53] group and I represent the ground handling [ph] company, the [indiscernible 0:03:58] in Pakistan and I look after their supply chain operations here. I’m also SCORP-certified [ph] from my time in Australia.
I happen to be a very rare breed in Pakistan so I’m working with a lot of the local institutes in trying to develop a greater use of SCOR not only in corporations here but also to try and set up an [indiscernible 0:04:25] SCOR certifications here, but that’s a longer term process. And there’s been a lot of interest in that. I’ve done a few guest speaker sessions with some of the universities here. Normally, it’s not a very well-known subject here but there are a few companies that have done SCOR implementations and it seems to have a marked improvement in their business processes because the supply chain, rather than becoming only the links in the organization chain, they really do dig the heart, the concept of THE supply chain, capital THE, and the fact that you have to have a gross cutting view of your supply chain from end to end.
That needs to define how the entire process works rather than based on how the commercial and operation elements need to run and are driving the rest of the process. I think that approach or that change in perspective has a significant improvement in success so I am a big believer in what SCOR can do for your organizations.
Thank you again for sharing today.
Absolute pleasure. Thank you for having me Dustin [ph].
About Imaad Rashid
Experienced Supply Chain Professional