A process is a unique activity performed to meet predefined outcomes. The SCOR processes are those that a supply chain must execute in order to meet its primary objective of fulfilling customer orders. For each unique process, SCOR only has one representation.
At the top of the SCOR Processes hierarchy is Orchestrate – a Level-0 process. Orchestrate is the only SCOR section that has a Level 0. The Level-0 process is at the Strategy level and informs and influences all of the levels below it.
After the Level-0 process, SCOR recognizes six major Level-1 processes — Plan, Order, Source, Transform, Fulfill, and Return.
","itemType":5,"order":1},{"id":20988,"sectionId":7980,"title":"Definition","data":"The Performance section of SCOR focuses on the measurement and assessment of the outcomes of supply chain process execution. A comprehensive approach to understanding, evaluating, and diagnosing supply chain performance consists of three elements: performance attributes, metrics, and process or practice maturity. These elements, which are distinct from the levels in the Process and metrics hierarchies, describe different aspects or dimensions of performance:
The People section of SCOR introduces standards for managing talent in the supply chain. This skills management framework within SCOR complements the Performance, Processes and Practices reference components. It also offers an integrated view of supply chain skills in four areas, namely
The key elements of the People section are skills, experiences and training.
","itemType":1,"order":1},{"id":21008,"sectionId":7982,"title":"Definition","data":"A practice is a unique way to configure a process or a set of processes. The uniqueness can be related to the automation of the process, a technology applied to the process, special skills applied to the process, a unique sequence for performing the process, or a unique method for distributing and connecting processes between organizations. All practices have links to one or more processes; one or more metrics; and, where available, one or more skills.
","itemType":1,"order":1},{"id":21011,"sectionId":7983,"title":"Definition","data":"The Orchestrate Supply Chain process describes the activities associated with the integration and enablement of supply chain strategies. These include the creation of and management of business rules, performance management through continuous improvement, managing data, information, and supply chain technology, human resources management, contracts and agreements management, network design, regulatory and compliance management, risk management, Environment, Social, and Governance (ESG) management, integrated business planning, segmentation creation and management, and circular supply chain management.
","itemType":5,"order":1},{"id":21014,"sectionId":7984,"title":"Definition","data":"The process of aligning the supply chain strategy to the overall business strategy and ensuring overall optimization of the network, underpinned by sustainable, demand-driven, and customer-focused objectives.
The supply chain strategy becomes the roadmap that ensures that every phase of the supply chain is best positioned to run effectively, including the planning, order management, transforming, fulfillment, and return functions.
The objective of the supply chain strategy is to maximize the overall value in line with the best business decisions for overall organizational profitability.
","itemType":5,"order":1},{"id":21019,"sectionId":7985,"title":"Definition","data":"The process associated with determining supply chain strategic goals, performance and sustainability requirements, and implications for supply chain design and operating model from the perspective of the overall organizational strategy. This process answers the question of how the supply chain supports the objectives of the overall strategy.
","itemType":1,"order":1},{"id":21021,"sectionId":7986,"title":"Definition","data":"The process associated with determining the 'start' and 'end' of the supply chain strategy vs. other business strategies, e.g., Marketing Strategy, Financial Strategy, and Sales Strategy - All sub-components of the overall organizational strategy.
","itemType":1,"order":1},{"id":21023,"sectionId":7987,"title":"Definition","data":"The process associated with determining the critical external factors that may impact supply chain strategy success.
","itemType":1,"order":1},{"id":21025,"sectionId":7988,"title":"Definition","data":"The process associated with analyzing the supply chains within an organization to determine the key drivers of supply chain performance and to segment and prioritize those supply chains that have a higher impact on strategic success.
","itemType":1,"order":1},{"id":21027,"sectionId":7989,"title":"Definition","data":"The process associated with gathering detailed information on the industry, stakeholders, inter-relationships, and external risks.
","itemType":1,"order":1},{"id":21029,"sectionId":7990,"title":"Definition","data":"The process associated with conducting an internal review of risks and risk responses.
","itemType":1,"order":1},{"id":21034,"sectionId":7991,"title":"Definition","data":"The process of determining the key drivers of performance that best align with strategic organizational direction.
","itemType":1,"order":1},{"id":21036,"sectionId":7992,"title":"Definition","data":"The process associated with developing initiatives to improve existing operating model performance.
","itemType":1,"order":1},{"id":21038,"sectionId":7993,"title":"Definition","data":"The process associated with connecting internal enablers with initiatives to achieve desired performance in the operating model.
","itemType":1,"order":1},{"id":21040,"sectionId":7994,"title":"Definition","data":"The process associated with communicating action plans and initiatives to relevant internal stakeholders.
","itemType":1,"order":1},{"id":21042,"sectionId":7995,"title":"Definition","data":"The process associated with monitoring, measuring, and executing the strategic plan to ensure successful implementation or reassessment.
","itemType":1,"order":1},{"id":21044,"sectionId":7996,"title":"Definition","data":"The process of establishing, documenting, communicating, and publishing supply chain business rules or policies and assumptions guiding supply chain decisions. A business rule (or policy) is a statement or parameter that defines or constrains some aspect of the business and is generally used in decision-making. Business rules are intended to influence the outcomes of operating the supply chain. They can apply to people, processes, corporate behavior, and computing systems in an organization and are put in place to help the organization achieve its goals while maintaining compliance with internal and external policies and laws. These are often provided as inputs into planning and execution systems.
An example business rule may state, \"No returns accepted without a return authorization.\"
Types of supply chain business rules include:
Note: OE2 Business Rules generally do not develop policies. Instead, it translates policies into business rules applied to supply chain processes.
","itemType":5,"order":1},{"id":21049,"sectionId":7997,"title":"Definition","data":"The process of collecting, organizing, prioritizing, and scheduling policies and directives requiring new supply chain business rules, changes to business rules, or discontinuation of business rules. This process may include scheduling and assigning activities to responsible individuals, groups, or organizations. Several of the business rules that are input into supply chain planning and execution processes may be set and tested during supply chain design.
","itemType":1,"order":1},{"id":21054,"sectionId":7998,"title":"Definition","data":"The process of determining how the policy or directive impacts supply chain processes, technology, and business rules. This process includes reviewing existing business rules and determining the need to add, change or delete business rules. The outcome is one or more of the following:
This step aims to identify the required activities and route the request(s) if required. As appropriate, the business rules need to be tested in a sandbox environment before approving and implementing them (e.g., sourcing or replenishment policies).
","itemType":1,"order":1},{"id":21057,"sectionId":7999,"title":"Definition","data":"The process of writing the business rule in the appropriate system of record. This includes adding, editing, and deleting policy and process documentation. A business rule should include a directive or policy, scope, and effective date. Updates to existing business rules may include discontinuation information.
The final activity of Document Business Rules is obtaining formal approval. The output of this process step is a fully documented business rule that is approved by the responsible function.
","itemType":1,"order":1},{"id":21061,"sectionId":8000,"title":"Definition","data":"The process of creating awareness in the relevant organization and among the appropriate staff of the upcoming changes. This process may include communication, training, and education programs. For small or incremental changes, a notice may be sufficient. These should ideally be undertaken by a Supply Chain Center of Excellence.
","itemType":1,"order":1},{"id":21065,"sectionId":8001,"title":"Definition","data":"The process of activating the business rule. This process may include the activation of a business rule in a software algorithm and starting to use a new or updated standard operating procedure. This process may include updating external websites and formal notifications to supply chain partners for large-impact business rule changes. This process should include appropriate modeling and testing before full activation in production instances for business rules enacted in software and automated systems. The release of a business rule may be time-phased, such as a bill of materials release for newer revisions.
","itemType":1,"order":1},{"id":21069,"sectionId":8002,"title":"Definition","data":"The process of deactivating a business rule. This process may include archiving the business rule in the associated software to prevent users from inadvertently using it or to comply with regulatory requirements or policies.
The retirement of a business rule may be time-phased, such as a bill of materials being replaced by newer revisions.
","itemType":1,"order":1},{"id":21073,"sectionId":8003,"title":"Definition","data":"The process of defining performance targets for supply chain metrics that align with the overall business strategy and goals. This process also includes reporting performance, identifying performance gaps, performing root cause analyses, and developing and launching corrective actions to close performance gaps. Instituting a continuous improvement program will establish ongoing continuous, incremental improvements. This process describes all levels and versions of managing supply chain performance. Examples include:
Note: It is common for organizations to have multiple versions of this process in different parts of the organization. At levels 3 and 4, these processes may differ significantly depending on the objectives of each of these Performance and Continuous Improvement processes.
","itemType":5,"order":1},{"id":21078,"sectionId":8004,"title":"Definition","data":"The process of developing a balanced scorecard compares how the supply chain is performing against its defined supply chain strategy. The balanced scorecard uses visualization and is used to measure the effectiveness of an activity against the strategic plans of a company. The balanced scorecard should provide end-to-end supply chain visibility against SCOR attributes (Reliability, Responsiveness, Agility, Cost, Profit, Assets, Environmental, and Social). A Supply Chain Control Tower can help visualize the data collected for the balanced scorecard. External Benchmarking against similar supply chains is recommended to understand how performance compares and how the company is balancing its supply chain performance.
","itemType":1,"order":1},{"id":21082,"sectionId":8005,"title":"Definition","data":"The process of scheduling and running reports and collecting and aggregating performance data. This process includes running standard or predefined reports and ad hoc reporting. Ad hoc reporting includes developing a data collection plan and organizing data collection through inspections, measurements, sampling, and self-assessments.
","itemType":1,"order":1},{"id":21086,"sectionId":8006,"title":"Definition","data":"The process of reviewing the reported performance. This process includes comparing actual performance and trends with the targets set for each metric, identifying metrics that require root cause analysis, notifying process owners, and scheduling the root cause analysis and related resources.
","itemType":1,"order":1},{"id":21090,"sectionId":8007,"title":"Definition","data":"The process of analyzing performance gaps. Performance gaps provide opportunities for improvement. Example methods for finding the root causes of performance gaps include:
All root causes are documented and quantified. Quantification is the calculation or estimation of the relative contribution to the gap in performance.
","itemType":1,"order":1},{"id":21094,"sectionId":8008,"title":"Definition","data":"The process of identifying, documenting, and testing corrective actions to address a root cause to close the related performance gap. Corrections actions include:
Note: This list of corrective actions is a general characterization for example purposes only. Different root causes may require different corrective actions.
","itemType":1,"order":1},{"id":21098,"sectionId":8009,"title":"Definition","data":"The process of sorting root causes by relative contribution to prioritize them and obtaining approvals, communicating, and launching the corrective actions.
After approval is secured, assign the root causes to resources, and schedule the development of corrective actions.
","itemType":1,"order":1},{"id":21101,"sectionId":8010,"title":"Definition","data":"The process of ensuring stated outcomes is continuously measured and managed. This process involves re-occurring leadership reviews to confirm that action plans and set improvement objectives are achieved.
","itemType":1,"order":1},{"id":21103,"sectionId":8011,"title":"Definition","data":"The process of defining and managing the digitalization roadmap for deployment and execution in accordance with the supply chain strategy and available technologies. While progress is made on the agreed technology roadmap, technology review must regularly be conducted to leverage fast-evolving digital solutions.
The scope of technology use in the supply chain goes well beyond the foundations of enterprise resources planning and materials requirements planning systems but also includes any decentralized data capturing technologies, track and trace, and collaborative technologies to drive the information systems in the supply chain.
Desired data is designed in the digital solution to facilitate the subsequent data analytics to generate operation and performance as well as decision making information to manage and improve the supply chain.
To assess the maturity of technology capability, please reference ASCM / Deloitte's Digital Capability Model for Supply Networks (DCM).
Maintaining master data sets and collecting auxiliary data by non-digital means may require publishing reports to plan, operate, measure, and manage the supply chain. Examples of major data element categories include Master Data, Transactional Data, Collaboration Data, Metadata, and Performance Data.
","itemType":5,"order":1},{"id":21108,"sectionId":8012,"title":"Definition","data":"The process of synthesizing supply chain capability requirements and technology alternatives into an overarching plan for new technology adoption and alignment to the overall digitalization roadmap.
Transitioning from an existing process to new technologies could be a complex endeavor. Converged technology systems and data flows require a structured, time-phased project plan regularly reviewed to the to-be process flow to ensure effectiveness.
A comprehensive evaluation of requirements involves internal and external research to develop robust requirements that consider strategic performance characteristics and goals, regulatory and compliance requirements, and leading and emerging practices from within the industry and across industries.
Activities include:
Note: Many organizations have enterprise-wide processes for managing technology. This process is not intended to duplicate or replace those enterprise processes but is intended to reinforce the need for focused attention and participation of the supply chain organization in the definition of requirements and technology choices for the supply chain. It does not include the standard information technology management activities for testing and implementing new technology solutions.
","itemType":1,"order":1},{"id":21112,"sectionId":8013,"title":"Definition","data":"The process associated with surveying and evaluating available technology options and capabilities. This process can and should occur parallel with \"Define supply chain data, information and/or technology requirements\" (OE4.1) so that unvetted requirements do not prematurely shape and direct technology or solution research and evaluation.
Companies should make it a business practice to regularly monitor available technology options to understand better what opportunities are possible and the risk profiles of various technology alternatives.
Examples of alternative supply chain technologies are the Internet of Things, track and trace technologies, Blockchain, Collaborative technologies, and other technologies to drive information systems such as ERP, MRP, DRP, WMS, and TMS.
","itemType":1,"order":1},{"id":21116,"sectionId":8014,"title":"Definition","data":"The process associated with developing a technical blueprint of the arrangement, interaction, and interdependence of all technology components to meet the relevant system requirements. Establish a timeline and focused task group to execute the deployment, including power users and related process stakeholders.
","itemType":1,"order":1},{"id":21121,"sectionId":8015,"title":"Definition","data":"The process associated with the detailed matching of business requirements to the capabilities of technology alternatives to determine the best overall solution, considering fit to requirements, compatibility with other integrating technologies, risks, and total costs of ownership for the technology. Technology selection is a cross-functional activity and is most effective when comprehensive selection criteria and weightings are defined in advance.
","itemType":1,"order":1},{"id":21125,"sectionId":8016,"title":"Definition","data":"This process starts with creating a project plan for the technology implementation and establishing a timeline and a focused task group, including power users and related process stakeholders, to execute the deployment. The plan coordinates the organizing, planning, scheduling, directing, controlling, monitoring, and evaluating prescribed activities to ensure the achievement of the stated objectives. The next step is to submit the plan to the approval process to validate top management's approval and ensure resource availability (technology, people, finance).
","itemType":1,"order":1},{"id":21129,"sectionId":8017,"title":"Definition","data":"The process associated with developing, configuring, testing, piloting, and fully deploying new supply chain technologies. The technical activities involved in technology deployment are represented in information technology, and engineering implementation best practice approaches and models.
Supply chain–related activities involve assessing and mitigating the supply chain risks associated with implementation issues and delays to ensure business continuity. Examples would include:
Supply chain management plays a vital role in understanding and preparing for technology implementation. Technology deployment considerations, such as downtime and lost capacity, and risk mitigations, including inventory buildup, become necessary inputs into supply chain technology plans.
","itemType":1,"order":1},{"id":21134,"sectionId":8018,"title":"Definition","data":"The process associated with continuously improving technology solution performance through ongoing performance analysis and enhancement of the hardware, models, algorithms, data quality captured and/or inputs, and configurations.
As technology solutions become increasingly sophisticated and business requirements change, it is unlikely that initial models and configurations used at deployment are optimal.
To accelerate improvement cycles, consider implementing leading practices, such as using simulation, digital twins, and metaverse of supply chains or supply chain segments to rapidly evaluate and refine models and algorithms offline before implementing them live in the supply chain.
","itemType":1,"order":1},{"id":21139,"sectionId":8019,"title":"Definition","data":"The process of verifying that data is accurately captured, and information is properly recorded in the system of record and properly populated to dependent systems. This process includes verifying that information is accessible to users and ensuring a governance process is in place with clearly defined governance rules, gatekeepers, and data owners.
","itemType":1,"order":1},{"id":21142,"sectionId":8020,"title":"Definition","data":"The process of developing, governing, and maintaining an organization of permanent, temporary, and outsourced staff with the right qualifications to support business objectives and supply chain goals. This process includes identifying required and available skills in the organization; determining gaps in skills and competency levels; and identifying training needs, resource gaps, and other resources.
Note: This planning process ensures enough staff is available at the right levels. The actual training, hiring, and redeployment of staff are not part of this process. Those are human resources processes.
","itemType":5,"order":1},{"id":21147,"sectionId":8021,"title":"Definition","data":"The process associated with collecting the required skills to operate part of the supply chain. This process includes planning meetings, periodic performance reviews, and reorganizations. The data collected should list the required skills or resources and is generally organized by an entity such as a supply chain node, department, function, or a combination of these.
","itemType":1,"order":1},{"id":21151,"sectionId":8022,"title":"Definition","data":"The process associated with collecting and identifying the skills and resources currently available in the supply chain. Generally, this information is collected and organized by entity, such as supply chain node, department, function, or combination of these. Examples of this process include data collection for standard headcount reports. Headcounts should include temporary staff and outsourced resources.
","itemType":1,"order":1},{"id":21153,"sectionId":8023,"title":"Definition","data":"The process associated with matching skill or resource demands with the available skills or resources. The purpose of this process is to:
For each skill or resource gap or excess, one or more actions need to be taken to close the gap or address the excess. Possible solutions include
It is important to consider the lead time of these actions. Scarce skills may have longer lead times, for example.
","itemType":1,"order":1},{"id":21156,"sectionId":8024,"title":"Definition","data":"The process associated with identifying sources of new hires or sources and destinations for redeployment. The purposes of this process include assessing the feasibility and impact of:
Note: At this stage, this is a planning activity. The hiring process is not documented in SCOR, as this is a human resources process. Also, an employee, in this context, includes temporary workers and employees of service providers.
","itemType":1,"order":1},{"id":21159,"sectionId":8025,"title":"Definition","data":"The process associated with identifying training and education programs ensures that existing and newly hired employees will have the appropriate skills to perform the work allocated to each employee. An employee, in this definition, includes temporary workers and employees of service providers.
","itemType":1,"order":1},{"id":21163,"sectionId":8026,"title":"Definition","data":"The process associated with obtaining approvals for hiring, redeployment, training, and education plans, prioritizing these plans and executing them. Additional resources and skill requirements will create the need to adjust the labor component of capacity in the Orchestrate Supply Chain, Plan, Order, Source, Transform, Fulfill, and Return processes over time.
","itemType":1,"order":1},{"id":21166,"sectionId":8027,"title":"Definition","data":"The process associated with monitoring employee performance, changes in required skills, development programs, and the financial return on education (ROE).
","itemType":1,"order":1},{"id":21169,"sectionId":8028,"title":"Definition","data":"The process of managing and communicating contractual and non-contractual agreements. These agreements support business objectives and supply chain goals. This process includes all agreements related to supply chain operations, including material and services acquisition, inventory-stocking practices and levels, performance targets, planning and decision-making, logistics and delivery, and data exchange and visibility.
","itemType":5,"order":1},{"id":21174,"sectionId":8029,"title":"Definition","data":"This process associated with creating a contract or Service Level Agreement (SLA). A contract must include information such as effective date and duration, customer or supplier address, and payment terms; it must not conflict with business rules or regulatory requirements, and it must have clearly defined service level criteria and remedial actions as part of the contract.
","itemType":1,"order":1},{"id":21177,"sectionId":8030,"title":"Definition","data":"The process associated with receiving new contracts or changes to existing contracts. These contract updates may originate in the sales and support department if they are for customer contracts or in the product and process design department if they are for contracts with material or service providers. This process includes the validation of contracts against criteria and business rules.
","itemType":1,"order":1},{"id":21181,"sectionId":8031,"title":"Definition","data":"The process associated with entering contractual information into document management systems, such as a Contract Lifecycle Management system) and enterprise resources planning systems. This process includes translating contractual language and information into a format the systems can comprehend. A final step in this process is distributing the contract or updates to an existing contract to the appropriate processes and functions.
","itemType":1,"order":1},{"id":21184,"sectionId":8032,"title":"Definition","data":"The process associated with activating or deactivating and archiving a contract. This process may include updating information statuses in document management systems or enterprise resources planning (ERP) systems. This activity may be triggered by the document management system, or the ERP system based on parameters entered as part of the Record and Distribute (OE6.2) process.
","itemType":1,"order":1},{"id":21186,"sectionId":8033,"title":"Definition","data":"The process associated with reviewing contractual parties' performance, including suppliers and customers. This process includes comparing the contractual service-level agreements with the actual service levels. It may be triggered by a calendar event, such as annual or quarterly quality reviews, or actual performance issues identified in daily supply chain processes.
","itemType":1,"order":1},{"id":21190,"sectionId":8034,"title":"Definition","data":"The process associated with identifying and prioritizing key performance issues or areas of ongoing process improvement. This process includes notifying contractual partners of non-conformance to contractual agreements or service-level agreements. It also addresses non-compliance or severe issues and areas of continuous improvement, which tend to be less severe and support common interests.
","itemType":1,"order":1},{"id":21194,"sectionId":8035,"title":"Definition","data":"The process associated with identifying ways to address non-compliance or how to implement performance improvements. For non-compliance, this process may have one or a combination of outcomes, including
Litigation or mediation may be considered in this process. However, these practices are not supply chain processes.
","itemType":1,"order":1},{"id":21198,"sectionId":8036,"title":"Definition","data":"The process associated with selecting, obtaining approvals for, and prioritizing the appropriate issue resolutions and then distributing the selected resolution(s) to the appropriate processes or functions.
Litigation or mediation may be the result of decisions made in this process. However, these practices are not supply chain processes.
","itemType":1,"order":1},{"id":21201,"sectionId":8037,"title":"Definition","data":"The process of defining and managing the geographic and activity footprint of a supply chain. This process defines the location of facilities and assigns resources, distribution networks, suppliers, customers, materials, products, capacities, and capabilities to those locations.
","itemType":5,"order":1},{"id":21206,"sectionId":8038,"title":"Definition","data":"The process associated with initiating a supply chain optimization project. This process begins with determining what part of the supply chain network to assess; this sets the project's scope. Organizations that manage the supply chain network as a project structure must establish a project organization. Organization selection includes identifying and securing the availability of a sponsor, stakeholders, and data or information providers and selecting project team members.
","itemType":1,"order":1},{"id":21209,"sectionId":8039,"title":"Definition","data":"The process associated with identifying the objective of the supply chain and collecting the data required to describe or model the supply chain at the level necessary. Collected data should include:
The process associated with developing what-if scenarios to support different strategies and projections. Scenarios may be developed for different detailed strategies, requirements, and potential internal or external changes. Activities include management interviews and external transportation and warehousing studies. Initial review of developed scenarios may result in rejection of the scenario or the decision to proceed to simulation.
","itemType":1,"order":1},{"id":21219,"sectionId":8041,"title":"Definition","data":"The process associated with developing models or simulation models to run what-if scenarios through a validation process. Simulation models may use automation, but conference room pilots or walk-throughs may also serve this purpose. The simulation's objective is to validate each scenario's feasibility and find possible network or process design flaws. Automated simulation tools may also predict the performance of the new network or processes by simulating the processing of large numbers of orders.
","itemType":1,"order":1},{"id":21224,"sectionId":8042,"title":"Definition","data":"The process associated with estimating the effort, risks, and results of implementing a scenario. Activities include estimating risks, funding duration, and the staff and skills required to implement the scenario. Risks include estimates of the impact on the value at risk for the supply chain. Results include changes that need to be made to the performance of the supply chain for all relevant metrics.
","itemType":1,"order":1},{"id":21229,"sectionId":8043,"title":"Definition","data":"The process associated with recommending and obtaining approvals for proposed supply chain network or configuration changes. This process includes reviewing the what-if scenarios and their impact or benefit results with key stakeholders. The objective of this process is to identify the optimal solution and present this recommendation to the sponsor and stakeholders and obtain approval to develop the change program.
","itemType":1,"order":1},{"id":21231,"sectionId":8044,"title":"Definition","data":"The process associated with developing the roadmap for the change program. This process includes identifying the steps or projects required to implement facility changes, contracted parties, staffing, automation, and processes.
","itemType":1,"order":1},{"id":21235,"sectionId":8045,"title":"Definition","data":"The process associated with following the approval steps needed for securing the budget and resources required for the project. In addition, during this process, develop the training programs and enablement materials required for change management.
","itemType":1,"order":1},{"id":21238,"sectionId":8046,"title":"Definition","data":"The process associated with coordinating, starting, and monitoring the individual change projects. This process includes supporting the establishment of change projects, coordinating launch dates, and communicating reporting requirements. Steps also may include archiving the supply chain network or configuration project documentation for future reference and dissolving the project team. Dissolving the project team requires transferring the monitoring responsibility to the appropriate organizations.
","itemType":1,"order":1},{"id":21242,"sectionId":8047,"title":"Definition","data":"The process of identifying, collecting, and assessing regulatory compliance requirements and integrating them into standard supply chain processes, policies, and business rules. This process also includes managing voluntary compliance with standards and certifications.
Regulatory compliance is a term generally used to describe an organization’s adherence to the laws, rules, and regulations relevant to its business and processes. These laws, rules, and regulations can relate to hazardous material handling, imports, and exports, labor, licensing, taxes, and more. Organizations should have processes and policies in place to ensure regulatory compliance. Often, organizations choose to go beyond compliance with regulations to comply with voluntary standards, such as ISO standards, or obtain voluntary certifications, such as Rainforest Alliance certification or Sustainable Forestry Initiative certification, for strategic reasons.
A key component of ensuring regulatory and voluntary compliance is establishing policies, business rules, and processes that meet legislative and regulatory compliance requirements. This process includes ensuring that personnel are aware of and take steps to comply with relevant laws, regulations, and standards and retaining the data or records required to validate compliance.
","itemType":5,"order":1},{"id":21247,"sectionId":8048,"title":"Definition","data":"The process of identifying, collecting, and assessing relevant regulatory compliance requirements and forecasting and predicting future regulatory changes affecting supply chain processes, including changes to standards, certifications, and the creation of new regulatory bodies.
The process will include establishing a structure for monitoring changes to regulations across industries globally.
","itemType":1,"order":1},{"id":21252,"sectionId":8049,"title":"Definition","data":"The process associated with identifying regulatory bodies, subscribing to their publications, and receiving and reviewing them.
","itemType":1,"order":1},{"id":21257,"sectionId":8050,"title":"Definition","data":"The process associated with reading, interpreting, and researching policies, laws, rules, and regulations. This process includes determining if and how these regulatory requirements apply to a supply chain.
","itemType":1,"order":1},{"id":21262,"sectionId":8051,"title":"Definition","data":"The process associated with identifying current and future regulatory requirements that are not being met or cannot be met using existing processes, business rules, and policies. This process includes notifying impacted organizations about the deficiency status.
","itemType":1,"order":1},{"id":21266,"sectionId":8052,"title":"Definition","data":"The process associated with identifying remediation alternatives, selecting and documenting processes, policies, and business rules, and setting documentation requirements to remediate a deficiency.
","itemType":1,"order":1},{"id":21268,"sectionId":8053,"title":"Definition","data":"The process associated with verifying the remediation strategy with controlling entities and obtaining a license certifying compliance with the controlling entity’s laws, rules, or regulations.
","itemType":1,"order":1},{"id":21271,"sectionId":8054,"title":"Definition","data":"The process associated with approving and implementing changes to processes, policies, and business rules. This process may include distributing certification documentation to relevant organizations in the supply chain.
","itemType":1,"order":1},{"id":21274,"sectionId":8055,"title":"Definition","data":"The process of identifying and assessing potential disruptions and risks in the supply chain and developing a plan to mitigate these threats. Supply chain risks include:
Risk mitigation strategies include:
Examples of changes to the supply chain network, process, and resources include insurance, relocation, dual or triple sourcing, outsourcing, insourcing, offshoring, reshoring, security protocols, supply chain redesign, process redesign, business rule changes, and contract renegotiation.
This process is closely aligned with section 5 of the ISO 31000 standard. ISO 31000 is a generic risk management standard that applies to all industries; Manage Supply Chain Risk is the adaptation for supply chain risk management. ISO 31000’s section 5.6 “Monitor and Review” is represented in SCOR as Performance and Continuous Improvement (OE3).
Notes: Risk handling and treatment: Once an enterprise understands its supply chain and has analyzed its potential risks, the company can implement an effective supply chain risk management program with its partners, suppliers, carriers, and logistics providers. Such a program should have at least three elements: protecting the supply chain, responding to events, and continuing business operations while recovering from events.
","itemType":5,"order":1},{"id":21279,"sectionId":8056,"title":"Definition","data":"The process of defining and documenting the objectives and internal and external scope for managing risk. This process includes developing and maintaining an understanding of the internal and external relationships and the internal and external factors that influence the supply chain's ability to achieve its objectives and defining and maintaining a risk management organization made of stakeholders, a governance structure, procedures, and a schedule.
","itemType":1,"order":1},{"id":21283,"sectionId":8057,"title":"Definition","data":"The process of identifying, collecting, and documenting all potential risk events, and their sources, which may prevent the organization from meeting its goals,
The process generates a comprehensive list of all risks that may disrupt the supply chain, including information about which the occurrence of the risk event will, directly and indirectly, impact processes in the supply chain. A broad classification of risk types includes
The number of risks within these types may vary by industry.
Continual monitoring of risks and their treatment: Once an organization has established a supply chain risk management program, including processes for identifying and treating risks, it should implement a monitoring program that evaluates plans, procedures, and capabilities through periodic review, testing, post-incident reports, and other exercises and outlines necessary corrective actions. The program should also review other organizational changes that may affect supply chain risk management.
Reference: Supply Chain Risk Leadership Council.
","itemType":1,"order":1},{"id":21287,"sectionId":8058,"title":"Definition","data":"The process of collecting and documenting for each potential risk the causes, probability of occurrence, and consequences. The standard metric for quantification of risk is value at risk (VaR):
VaR = Probability of Occurrence x Monetary Impact of Occurrence.
This process generates a comprehensive list of the monetary impact of all risks that may disrupt the supply chain. For certain types of risk events, probability information may be available through government agencies, insurance companies, or research firms. The monetary impact is determined based on the projected financial impact of each risk event on each supply chain. Here are some examples:
Risk events may have different financial impacts, such as revenue reductions or cost increases.
","itemType":1,"order":1},{"id":21292,"sectionId":8059,"title":"Definition","data":"The process of prioritizing risk events by value at risk and determining for each risk whether mitigation actions are required or if the risk is acceptable.
","itemType":1,"order":1},{"id":21296,"sectionId":8060,"title":"Definition","data":"The process of determining the actions required to eliminate, reduce, or accept and monitor a risk. This process can include creating, approving, communicating, and launching the risk mitigation plan.
","itemType":1,"order":1},{"id":21300,"sectionId":8061,"title":"Definition","data":"The process associated with approving and implementing a risk resolution strategy. This process includes actions to mitigate, avoid or accept risk.
","itemType":1,"order":1},{"id":21302,"sectionId":8062,"title":"Definition","data":"The process of including environmental, social, and governance aspects in business performance decision making. Environmental, Social, and Governance is focused on long-term value creation and is a synonym for sustainability.
","itemType":5,"order":1},{"id":21307,"sectionId":8063,"title":"Definition","data":"The activities required to develop a supply chain strategy that aligns with the overall business sustainability strategy.
","itemType":1,"order":1},{"id":21310,"sectionId":8064,"title":"Definition","data":"The process in which the desired governance, internal and external, environmental, and social performance is determined for all relevant processes. Furthermore, practices and people's skills are defined and developed to accomplish the desired performance levels.
","itemType":1,"order":1},{"id":21313,"sectionId":8065,"title":"Definition","data":"The process of using materiality analysis to develop a materiality index.
A materiality index identifies and prioritizes the environmental, social, and governance aspects that are most important to the enterprise and its stakeholders.
","itemType":1,"order":1},{"id":21317,"sectionId":8066,"title":"Definition","data":"The process of identifying, collecting, and documenting all potential risk events that may prevent the organization from meeting its goals. This process includes identifying sources of risk.
This process generates a comprehensive list of all - financial, environmental, and social - risks that may disrupt the supply chain, including information about which processes in the supply chain will be directly and indirectly impacted by the occurrence of the risk event. A broad classification of risk types includes
The number of risks within these types may vary by industry.
","itemType":1,"order":1},{"id":21321,"sectionId":8067,"title":"Definition","data":"The process of developing the capability of a supply chain to anticipate, create plans to avoid or mitigate, and/or to recover from disruptions to supply chain functionality.
","itemType":1,"order":1},{"id":21325,"sectionId":8068,"title":"Definition","data":"The process of developing an integrated representation of the company's financial, environmental, and social performance regarding long-term value creation.
","itemType":1,"order":1},{"id":21329,"sectionId":8069,"title":"Definition","data":"The process associated with seamlessly integrating strategic goals, financial objectives, and tactical and operational plans into everyday business decision-making through access to cross-functional data and deliberate alignment. The Enterprise Business Plan is a strategic level plan and is typically reviewed annually, the planning horizon is 3 to 10 years. Changes to the plans in this zone have minimum cost and disruption.
","itemType":5,"order":1},{"id":21334,"sectionId":8070,"title":"Definition","data":"The process of aligning the long-term financial plan with the supply chain strategy to achieve their long, medium, and short-term performance goals.
","itemType":1,"order":1},{"id":21338,"sectionId":8071,"title":"Definition","data":"The process of developing scenarios to identify needed responses to meet the economic, environmental, and social objectives of the company along with corporate sustainability goals.
","itemType":1,"order":1},{"id":21343,"sectionId":8072,"title":"Definition","data":"The process that sets operational, tactical, and long-term plans to achieve and sustain the strategic objectives of the business plan that is implemented through the orchestration of resources, actions, and intermediate milestones.
","itemType":1,"order":1},{"id":21345,"sectionId":8073,"title":"Definition","data":"The process associated with growing, sustaining, and optimizing product life cycle portfolios, including packaging and service, through measures of portfolio health, such as product productivity, supporting launch and phase-out roadmaps, and alignment to commercialization plans, including brand and packaging plans.
","itemType":1,"order":1},{"id":21347,"sectionId":8074,"title":"Definition","data":"The process of driving decision making through the use of Business Intelligence (BI) software. The iterative Integrated Business Planning process translates decisions into business activities across all stakeholders.
","itemType":1,"order":1},{"id":21350,"sectionId":8075,"title":"Definition","data":"The process of designing and operating distinctly different end-to-end value chains (from customers to suppliers) that are optimized by a combination of unique customer value, product attributes, manufacturing and supply capabilities, and business value considerations.
Supply chain segmentation is the dynamic alignment of customer channel demands and supply response capabilities optimized for net profitability across each segment.
All metrics linked to OE12 should be applied at a segment level.
","itemType":5,"order":1},{"id":21355,"sectionId":8076,"title":"Definition","data":"This process results in a view showing what and where / to whom the organization sells.
","itemType":1,"order":1},{"id":21359,"sectionId":8077,"title":"Definition","data":"This process overlays the supply chain related aspects to the product/customer matrix, to determine which characteristics would be relevant to the supply chain design and the degree to which these characteristics impact performance.
Typical differentiators could include, but are not limited to, the following:
This process creates a listing of each intersection of customer / geography and product / product family based on the assigned differentiators (E.g., Forecast ability, customer prioritization, brand priority, supplier types/segments)
","itemType":1,"order":1},{"id":21367,"sectionId":8079,"title":"Definition","data":"This process creates broader segment groupings that are aligned with similar levels of the characteristics already defined, e.g., If two characteristics have been defined, namely ‘Demand Volatility’ and ‘Number of Suppliers’, then, for example, in a set of segments A – G, Segment A, C and D may have a high demand volatility and small supplier base, meaning these may need to be treated in a similar manner when determining the appropriate future operating model.
","itemType":1,"order":1},{"id":21371,"sectionId":8080,"title":"Definition","data":"This process matches the market's competitive requirements with the segment's performance abilities to find the best combination to compete in the marketplace.
","itemType":1,"order":1},{"id":21375,"sectionId":8081,"title":"Definition","data":"The process to define how we run the supply chain operations in a way that aligns with the supply chain strategy to support the market's competitive requirements. For example:
The process to add segment metrics to the balanced scorecard or other benchmarking tools for visibility into segment performance.
See OE2.1 - Develop balanced scorecard.
","itemType":1,"order":1},{"id":21382,"sectionId":8083,"title":"Definition","data":"The process to deliver the segment metrics for the balanced scorecard.
","itemType":1,"order":1},{"id":21385,"sectionId":8084,"title":"Definition","data":"The process to set the key performance indicators by segment for monitoring.
","itemType":1,"order":1},{"id":21389,"sectionId":8085,"title":"Definition","data":"The process of determining the KPI targets based on the strategic requirements for the targeted market segments being monitored.
","itemType":1,"order":1},{"id":21393,"sectionId":8086,"title":"Definition","data":"The process of developing a supply chain that eliminates waste and pollution, circulates products and materials, regenerates nature, and is transitioning to renewable energy and materials. The Circular Supply Chain requires a fundamental shift of thinking for supply chain professionals from the idea of having infinite resources to one where products are reused and repurposed with minimum waste and energy usage. The subprocesses are in order of priority: (1) reduce (2) extend product lifecycle (3) recovery for reuse and repurpose.
","itemType":5,"order":1},{"id":21398,"sectionId":8087,"title":"Definition","data":"The process of evaluating and quantifying the use of all materials, water, and energy in the end-to-end processes.
","itemType":1,"order":1},{"id":21401,"sectionId":8088,"title":"Definition","data":"The process of reducing the use of materials, water, and energy in the end-to-end processes. Lean and Six Sigma processes can jumpstart this reduction, but reexamining materials and transformation processes will be necessary to make substantial reductions.
","itemType":1,"order":1},{"id":21404,"sectionId":8089,"title":"Definition","data":"The process of evaluating fixed assets and reducing any inefficiencies or waste in the processes associated with those assets. Inefficiencies waste materials, energy, and employee time. Preventative maintenance, well-trained staff, improving asset utilization ratios, and other techniques can help increase the efficient use of fixed assets. Moreover, the use of energy with the lowest possible environmental impact is prioritized.
","itemType":1,"order":1},{"id":21407,"sectionId":8090,"title":"Definition","data":"The process of evaluating and reducing waste throughout the supply chain. Lean methods can help identify and reduce waste in all areas of the supply chain. Reducing waste can improve productivity, reduce costs, and provide a better working environment.
","itemType":1,"order":1},{"id":21410,"sectionId":8091,"title":"Definition","data":"The process of extending the product lifecycle. The product lifecycle can be extended in several ways:
The process to make returns easy and to have an effective procedure for dealing with returns when returns arrive- reuse, repurpose, or dispose of them responsibly. A more effective step is to design sustainability into products and services to maximize the ability to reuse or repurpose returned materials.
","itemType":1,"order":1},{"id":21416,"sectionId":8093,"title":"Definition","data":"The Plan process describes the activities associated with developing plans to operate the supply chain. Planning is executed for the Order, Source, Transform, Fulfill and Return processes. These include determining requirements, gathering information about available resources, balancing requirements and resources to determine planned capabilities and gaps in demand or resources, and identifying actions to correct these gaps.
","itemType":5,"order":1},{"id":21421,"sectionId":8094,"title":"Definition","data":"The process of developing and establishing courses of action that represent a projected appropriation of supply chain resources to meet supply chain requirements. This is done at the operational level of planning and is typically reviewed monthly.
","itemType":5,"order":1},{"id":21426,"sectionId":8095,"title":"Definition","data":"The process of collecting and analyzing external factors that may influence the demand requirements.
","itemType":1,"order":1},{"id":21431,"sectionId":8096,"title":"Definition","data":"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 composed of the following concepts: sales forecasting level, time horizon and time interval. The sales forecasting level is the level of detail required for the forecast, such as the corporate level, division level, product line level, stock keeping unit level, or stock keeping unit by location level. The sales forecasting time horizon generally coincides with the time frame of the plan for which it was developed, such as an annual, monthly, weekly or daily timeline. The sales forecasting time interval generally coincides with how often the plan is, such as a daily, weekly, monthly or quarterly time frame.
","itemType":1,"order":1},{"id":21436,"sectionId":8097,"title":"Definition","data":"The process of collecting and analyzing internal and external supply requirements to meet the unconstrained demand/requirements. This process will include the capacity, capability, and availability of products and resources needed to meet the demand over the planning horizon.
","itemType":1,"order":1},{"id":21441,"sectionId":8098,"title":"Definition","data":"The process of identifying and measuring the gaps and imbalances between demand and resources to determine how to best resolve the variances through marketing, pricing, packaging, warehousing, outsourcing plans, or some other action that will optimize service, flexibility, costs, assets, or other supply chain inconsistencies in an iterative and collaborative environment. Includes developing a time-phased course of action that commits supply chain resources to meet supply chain requirements.
","itemType":1,"order":1},{"id":21446,"sectionId":8099,"title":"Definition","data":"The process of realigning the supply and demand plans, as required, to meet the business and supply chain goals.
","itemType":1,"order":1},{"id":21451,"sectionId":8100,"title":"Definition","data":"The process of establishing and communicating courses of action, throughout the appropriate time-defined planning horizon and interval, which represent a projected appropriation of supply chain resources to meet supply chain requirements.
","itemType":1,"order":1},{"id":21456,"sectionId":8101,"title":"Definition","data":"The process of developing and establishing courses of action that represent a projected appropriation to meet order requirements as part of the order management processes.
","itemType":5,"order":1},{"id":21461,"sectionId":8102,"title":"Definition","data":"The process of identifying, aggregating, and prioritizing all sources that would generate an order in the integrated supply chain of a product or service.
","itemType":1,"order":1},{"id":21466,"sectionId":8103,"title":"Definition","data":"The process of collecting and analyzing internal and external order processing requirements to meet the unconstrained demand/requirements. This process will include the capacity, capability, and availability of resources needed to satisfy the processing orders over the planning horizon.
","itemType":1,"order":1},{"id":21471,"sectionId":8104,"title":"Definition","data":"The process of identifying and measuring the gaps and imbalances between order demands and the resources to support them to determine how to best resolve the variances with some action that will optimize service, flexibility, and other supply chain inconsistencies in an iterative and collaborative environment.
","itemType":1,"order":1},{"id":21475,"sectionId":8105,"title":"Definition","data":"The process of realigning the order management processing plan and the demand plan, as required, to meet the business and supply chain goals by altering, as required, the order processing or resource plan.
","itemType":1,"order":1},{"id":21478,"sectionId":8106,"title":"Definition","data":"The process of establishing and communicating courses of action, throughout the appropriate time-defined planning horizon and interval, which represent a projected appropriation of supply chain resources to meet supply chain requirements for the order management process.
","itemType":1,"order":1},{"id":21482,"sectionId":8107,"title":"Definition","data":"The process of developing and establishing courses of action throughout specified time periods that represent a projected appropriation of material resources to meet supply chain requirements' sourcing activities.
","itemType":5,"order":1},{"id":21487,"sectionId":8108,"title":"Definition","data":"The process of identifying, prioritizing, and considering as a whole, and the constituent parts, all sources of demand for a product or service in the supply chain.
","itemType":1,"order":1},{"id":21492,"sectionId":8109,"title":"Definition","data":"The process of establishing courses of action, throughout specified time periods, which represent a projected appropriation of supply resources needed to meet sourcing plan requirements.
","itemType":1,"order":1},{"id":21497,"sectionId":8110,"title":"Definition","data":"The process of developing a time-phased review and course of action scenarios that balance and commits sourcing supply resources to fulfill customer order requirements.
","itemType":1,"order":1},{"id":21502,"sectionId":8111,"title":"Definition","data":"The process of realigning the sourcing plan and the demand plan to meet the business and supply chain goals by altering, as required, the sourcing activities, demand plan, and resource plan.
","itemType":1,"order":1},{"id":21505,"sectionId":8112,"title":"Definition","data":"The process of developing and establishing courses of action throughout specified time periods that represents a projected appropriation of source resources to meet the source requirements.
","itemType":1,"order":1},{"id":21510,"sectionId":8113,"title":"Definition","data":"The process of developing and establishing courses of action throughout specified time periods that represents a projected appropriation of production resources to meet the transformation (e.g., production or service) requirements.
","itemType":5,"order":1},{"id":21515,"sectionId":8114,"title":"Definition","data":"The process of identifying, prioritizing, and considering as a whole, with constituent parts, all sources of demand in creating a product or service.
","itemType":1,"order":1},{"id":21520,"sectionId":8115,"title":"Definition","data":"The process of establishing courses of action, throughout specified time periods, which represent a projected appropriation of supply resources to meet production and operating plan requirements.
","itemType":1,"order":1},{"id":21525,"sectionId":8116,"title":"Definition","data":"The process of developing a time-phased review and course of action scenarios that balance operation resources to fulfill operation requirements.
","itemType":1,"order":1},{"id":21530,"sectionId":8117,"title":"Definition","data":"The process of realigning the production plan and the demand plan to meet the business and supply chain goals by altering, as required, the demand plan or transformation activities to support the business requirements.
","itemType":1,"order":1},{"id":21533,"sectionId":8118,"title":"Definition","data":"The process of establishing and communicating courses of action, throughout the appropriate time-defined planning horizon and interval, which represent a projected appropriation of supply chain resources to meet supply chain requirements for the transformation process.
","itemType":1,"order":1},{"id":21538,"sectionId":8119,"title":"Definition","data":"The process of developing and establishing courses of action throughout specified time periods that represent a projected appropriation of delivery resources to meet fulfillment requirements.
","itemType":5,"order":1},{"id":21543,"sectionId":8120,"title":"Definition","data":"The process of identifying, prioritizing, and considering as a whole, with constituent parts, all sources of demand in fulfilling a product or service.
","itemType":1,"order":1},{"id":21548,"sectionId":8121,"title":"Definition","data":"The process of identifying, evaluating, and considering as a whole, with constituent parts, all things that add value to the fulfillment of a product or service.
","itemType":1,"order":1},{"id":21553,"sectionId":8122,"title":"Definition","data":"The process of developing a time-phased course of action that commits delivery resources to meet delivery requirements.
","itemType":1,"order":1},{"id":21558,"sectionId":8123,"title":"Definition","data":"The process of aligning the fulfillment process plan and the demand plan to meet the business and supply chain goals by altering, as required, the demand or fulfillment activities to support the business requirements.
","itemType":1,"order":1},{"id":21561,"sectionId":8124,"title":"Definition","data":"The process of establishing and communicating courses of action, throughout the appropriate time-defined planning horizon and interval, which represent a projected appropriation of supply chain resources to meet supply chain requirements for the fulfillment process.
","itemType":1,"order":1},{"id":21566,"sectionId":8125,"title":"Definition","data":"The strategic or tactical process of establishing and adjusting courses of action or tasks throughout specified time periods that represent a projected appropriation of return resources and assets to meet anticipated and unanticipated return requirements. The scope includes unplanned returns of sold merchandise and planned returns of rotable products. The process includes developing and establishing refurbished products for reissue to customers.
","itemType":5,"order":1},{"id":21571,"sectionId":8126,"title":"Definition","data":"The process of identifying, evaluating, and considering as a whole, with constituent parts, all sources of demand for the return of a product.
","itemType":1,"order":1},{"id":21576,"sectionId":8127,"title":"Definition","data":"The process of establishing courses of action throughout specified time periods that represent a projected appropriation of required return resources or assets to meet return process requirements.
","itemType":1,"order":1},{"id":21581,"sectionId":8128,"title":"Definition","data":"The process of developing plans that make it possible to commit return resources or assets to satisfy return requirements.
","itemType":1,"order":1},{"id":21586,"sectionId":8129,"title":"Definition","data":"The process of aligning the return process plan and the demand plan to meet the business and supply chain goals by altering, as required, the demand or return activities to support the business requirements.
","itemType":1,"order":1},{"id":21589,"sectionId":8130,"title":"Definition","data":"The process of establishing and communicating courses of action throughout specified time periods that represent a projected appropriation of required return resources or assets to meet return process requirements.
","itemType":1,"order":1},{"id":21594,"sectionId":8131,"title":"Definition","data":"The order process describes the activities associated with the customer purchase of products and services, including attributes such as locations, payment methods, pricing, fulfillment status, and any other order data.
","itemType":5,"order":1},{"id":21599,"sectionId":8132,"title":"Definition","data":"The process associated with commerce conducted between businesses and final consumers. B2C traditionally referred to mall shopping, eating out at restaurants, pay-per-view movies, and infomercials. However, the rise of the internet created a whole new B2C business channel in the form of e-commerce or selling goods and services through the internet. Online B2C is divided into five categories: direct sellers, online intermediaries, advertising-based B2C, community-based, and fee-based.
Processes include planning, directing, monitoring, and controlling customer orders, such as order promising, order entry, order pick, pack and ship, billing, and reconciliation of the customer account.
","itemType":5,"order":1},{"id":21604,"sectionId":8133,"title":"Definition","data":"The process of gathering, organizing, and analyzing data about your customers; also known as Customer Data Management (CDM).
","itemType":1,"order":1},{"id":21608,"sectionId":8134,"title":"Definition","data":"The process of determining the priority status of a customer. Customer loyalty programs are a crucial mechanism when considering improvements to customer acquisition, satisfaction, and retention rates; visibility of customers and communication strategies; and increased data quality and higher revenue.
","itemType":1,"order":1},{"id":21612,"sectionId":8135,"title":"Definition","data":"The aggregation of the items requested by the customer into an order. Note that requests may come through different channels, and all channels should be monitored, and orders should be processed across multiple channels.
","itemType":1,"order":1},{"id":21616,"sectionId":8136,"title":"Definition","data":"The process of handling credit card authorization captures. Capturing an authorization means the authorized amount of money is transferred from the cardholder account to the merchant account. The capture operation requires a previously successful authorization that has not yet expired. In addition, the payment process includes partial card authorization captures, voids, or refunds.
","itemType":1,"order":1},{"id":21620,"sectionId":8137,"title":"Definition","data":"The process of generating consolidated detailed information from ship notices and their related customer orders, including shipping dates. The information shows that the goods receipts in the account have been sent in response to customer orders. It also shows goods receipt information of each line item's quantities that were ordered, shipped, and invoiced.
","itemType":1,"order":1},{"id":21624,"sectionId":8138,"title":"Definition","data":"The process of collecting, processing cancel requests, and stopping execution.
","itemType":1,"order":1},{"id":21628,"sectionId":8139,"title":"Definition","data":"The process associated with commerce between two businesses rather than between a business and an individual consumer. Transactions at the wholesale level are usually business-to-business, while those at the retail level are most often business-to-consumer (B2C). While business-to-business transactions often involve high prices and volume, they can also happen on a much smaller scale when a small business sells products or services to another small company.
Processes include planning, directing, monitoring, and controlling customer orders, such as order promising, order entry, order pick, pack and ship, billing, and reconciliation of the customer account.
","itemType":5,"order":1},{"id":21633,"sectionId":8140,"title":"Definition","data":"The process of receiving and responding to general customer inquiries and requests for quotes.
","itemType":1,"order":1},{"id":21638,"sectionId":8141,"title":"Definition","data":"The process of entering customer orders in the business's system, identifying on-hand and scheduled inventory, and reserving it for specific orders.
","itemType":1,"order":1},{"id":21643,"sectionId":8142,"title":"Definition","data":"The process of identifying the inventory ordered, both on hand and scheduled, and reserving the quantity required for the new order. A delivery date is committed and scheduled.
","itemType":1,"order":1},{"id":21648,"sectionId":8143,"title":"Definition","data":"The process of designating the volume required of on-hand stock to specific orders. Once allocation rules are applied, this stock cannot be used for other orders.
","itemType":1,"order":1},{"id":21652,"sectionId":8144,"title":"Definition","data":"The process of entering and finalizing the customer's order, approving the planned resources, including engineering and manufacturing resources, and officially generating the order.
","itemType":1,"order":1},{"id":21657,"sectionId":8145,"title":"Definition","data":"The process associated with handling credit card authorization captures. Capturing an authorization means the authorized amount of money is transferred from the cardholder account to the merchant account. The capture operation requires a previously successful authorization that has not yet expired. In addition, the payment process includes partial card authorization captures, voids, or refunds.
","itemType":1,"order":1},{"id":21661,"sectionId":8146,"title":"Definition","data":"The process of transmitting the order through the business's system for fulfillment.
","itemType":1,"order":1},{"id":21665,"sectionId":8147,"title":"Definition","data":"The process of collecting and processing cancel requests and stopping execution on those requests.
","itemType":1,"order":1},{"id":21669,"sectionId":8148,"title":"Definition","data":"The process associated with managing and controlling an internal order through all stages within a business's system. The process tracks which stage an order is in and which stage it should be passed to next. It allows the stakeholders to utilize the system to react to status changes or to replace or add additional functionality.
","itemType":5,"order":1},{"id":21674,"sectionId":8149,"title":"Definition","data":"The process of requesting the movement of stock from one location to another.
","itemType":1,"order":1},{"id":21677,"sectionId":8150,"title":"Definition","data":"The process of reviewing the availability of requested resources to determine a delivery date.
","itemType":1,"order":1},{"id":21680,"sectionId":8151,"title":"Definition","data":"The process of designating the volume required of on-hand stock to specific orders. Once allocation rules are applied, this stock cannot be used for other orders.
","itemType":1,"order":1},{"id":21683,"sectionId":8152,"title":"Definition","data":"The process of confirming that intracompany orders are compliant with established business rules and officially generating the order.
","itemType":1,"order":1},{"id":21687,"sectionId":8153,"title":"Definition","data":"The process of transmitting the order through the business's system for fulfillment.
","itemType":1,"order":1},{"id":21690,"sectionId":8154,"title":"Definition","data":"The process of collecting and processing cancel requests and stopping execution on those requests.
","itemType":1,"order":1},{"id":21693,"sectionId":8155,"title":"Definition","data":"The Source process describes the activities associated with procuring, ordering, scheduling the ordering, delivery, receipt, and transfer of products and/or services.
","itemType":5,"order":1},{"id":21698,"sectionId":8156,"title":"Definition","data":"The process associated with locating and sourcing key suppliers, which often includes analyzing total spend. This process focuses on developing long-term relationships with trading partners who can help the purchaser meet profitability and customer satisfaction goals. Information technology applications include E-Procurement, automation of request for quote (RFQ), request for proposal (RFP), electronic auctioning (e-auction or reverse auction), and contract management systems.
","itemType":5,"order":1},{"id":21703,"sectionId":8157,"title":"Definition","data":"The process associated with defining and understanding the business opportunity or need. This process involves cross-functional stakeholder involvement to develop a comprehensive high-level specification. Whether for performance or conformance, a specification is a systematic statement of the requirements to be satisfied in the supply of a product or service and sits at the heart of the contract between the buyer and the seller. Developing a specification must define the business requirements clearly and communicate these to suppliers effectively to facilitate the evaluation of goods and services against the agreed specification.
","itemType":1,"order":1},{"id":21708,"sectionId":8158,"title":"Definition","data":"This process is associated with conducting a supply market opportunity analysis to assess available supply market options. This analysis helps identify the potential suppliers and the degree of competition in the supply market. It also entails conducting make or buy analysis.
","itemType":1,"order":1},{"id":21713,"sectionId":8159,"title":"Definition","data":"The process of developing a sourcing strategy or plan to procure the products and services required by the organization. Inputs into this process include specifications, business requirements, and marketplace assessments. The sourcing strategy or plan must adhere to external laws and regulations and internal policies and guidelines. The plan must account for supply chain risks and consider options like conducting a competitive tender, developing the product in-house, using a sole supplier or single source of supply, dual sourcing, in-country value, and centralized vs. decentralized procurement.
","itemType":1,"order":1},{"id":21718,"sectionId":8160,"title":"Definition","data":"The activities associated with testing the market to determine if it is the right time to release a product or service into the marketplace. This process might uncover other factors to consider, including what competitors are doing, supplier performance, and new legislation.
Market development identifies stakeholder and business needs and the changes required to implement the procurement strategy to meet those needs flexibly.
","itemType":1,"order":1},{"id":21723,"sectionId":8161,"title":"Definition","data":"The process of screening the market to identify an organization that provides a needed good or service. Given a set of criteria, the sourcing team will use different methodologies to identify potential suppliers that meet their criteria.
","itemType":1,"order":1},{"id":21728,"sectionId":8162,"title":"Definition","data":"The process of prequalifying suppliers. This process assesses a potential supplier's capability to control factors such as quality, delivery, quantity, price, financial stability, and all other factors to be embodied in a contract. The importance of supplier prequalification is that it is an essential aspect of both strategic sourcing, supplier management, and the achievement of competitive advantage.
","itemType":1,"order":1},{"id":21733,"sectionId":8163,"title":"Definition","data":"The process of determining the intensity of supplier collaboration driven by the sourcing strategy, category management, and material/services classification, which would result in the decision to form virtual alliances, strategic alliance, partnering, ongoing relationship, or even arm's length collaboration.
","itemType":1,"order":1},{"id":21738,"sectionId":8164,"title":"Definition","data":"The process of sending a formal invite to tender (ITT) and/or a request for quote (RFQ) to selected potential suppliers. Items included are project specifications, documentation about the business requirements, and clear timelines for response.
","itemType":1,"order":1},{"id":21743,"sectionId":8165,"title":"Definition","data":"The process of evaluating and validating bids and proposals to select the preferred supplier(s). Tender evaluation should be carried out in a structured, disciplined, and transparent manner, regardless of whether the contracts are for the supply of goods or services. Most evaluations explore price comparisons alongside technical capabilities, capacity, quality of service, and the supplier's financial health.
","itemType":1,"order":1},{"id":21748,"sectionId":8166,"title":"Definition","data":"The process associated with post-tender negotiation. Whole-life costs should also be considered, including decommissioning, removal, or disposal costs. After negotiation, developing a contract will allow both the customer and the chosen supplier to fully understand the agreement's obligations and key success criteria. The agreed terms and conditions help minimize contractual risks and exposure when doing business. Once the contract and terms are agreed upon, the communication and implementation process can begin. Clear timelines and parameters should be set up on both sides. Both parties should also form relevant stakeholder groups to effectively manage the contract implementation.
","itemType":1,"order":1},{"id":21753,"sectionId":8167,"title":"Definition","data":"The process associated with the procurement of products or services that forms the final product, such as raw materials used in the transformation process to make finished products and services sold to consumers.
","itemType":5,"order":1},{"id":21758,"sectionId":8168,"title":"Definition","data":"The process associated with determining the approach that will trigger orders to the supplier. Depending on factors like sourcing strategy and collaboration arrangement, this can take many forms, such as PO, Kanban, MRP, supplier-triggered replenishment, prearranged delivery schedules, or a delivery request from a call-off. This process is part of short-term planning and is typically within the Frozen Time Fence and changes cannot be made without senior management approval. It is managed daily with a planning horizon of 1 to 30 days.
","itemType":1,"order":1},{"id":21763,"sectionId":8169,"title":"Definition","data":"The process of scheduling and managing the execution of individual product deliveries in the context of existing contracts or purchase orders. The requirements for product releases are determined based on a detailed sourcing plan or other types of product pull signals.
","itemType":1,"order":1},{"id":21768,"sectionId":8170,"title":"Definition","data":"The process of moving materials from suppliers or vendors into customer storage facilities. This process is part of the inbound logistics order management process. Inbound order management entails various activities, including planning, directing, monitoring, and controlling the processes related to purchase orders, such as outsourcing logistics service providers, coordinating documentation, tracking, and tracing shipments.
","itemType":1,"order":1},{"id":21773,"sectionId":8171,"title":"Definition","data":"The process and activities of receiving products to contract requirements. By planning the receiving operation, logistics professionals can schedule inbound shipments so that they can be quickly unloaded and moved from the receiving area into the storage location. This process is facilitated by coordinating shipment arrivals with labor availability and preparing crews for a shipment’s anticipated unloading needs (e.g., special equipment). Pre-receiving arrangements include:
The process and activities required to determine a product or service's conformance to specifications and the statement of work. It entails sampling, verifying marks, and testing to accept or reject products and services.
","itemType":1,"order":1},{"id":21783,"sectionId":8173,"title":"Definition","data":"The process of transferring accepted products to the appropriate stocking location within the organization. This process includes all the activities associated with repackaging, staging, moving, and stocking products. For services, this is the transfer or application of a service to the final customer or end user.
","itemType":1,"order":1},{"id":21788,"sectionId":8174,"title":"Definition","data":"The process of authorizing payments and paying suppliers for products or services. This process includes invoice collection, invoice matching with receiving, and the issuance of payment.
","itemType":1,"order":1},{"id":21793,"sectionId":8175,"title":"Definition","data":"The process associated with procuring the goods and services the organization needs to continue operating but are not directly linked to producing the products and services it sells. Although important to an organization, some indirect procurement can be sourced from several different suppliers, and as a result, supplier relationships can differ from those in direct procurement. A few examples of indirect procurement include rent, utilities, MRO supplies, capital expenditures, and services.
","itemType":5,"order":1},{"id":21798,"sectionId":8176,"title":"Definition","data":"The process associated with determining the approach that will trigger orders to the supplier. Depending on factors like sourcing strategy and collaboration arrangement, this can take many forms, such as PO, Kanban, MRP, supplier-triggered replenishment, prearranged delivery schedules, or a delivery request from a call-off. This process is part of short-term planning and is typically within the Frozen Time Fence and changes cannot be made without senior management approval. It is managed daily with a planning horizon of 1 to 30 days.
","itemType":1,"order":1},{"id":21803,"sectionId":8177,"title":"Definition","data":"The process of scheduling and managing the execution of individual product deliveries in the context of existing contracts or purchase orders. The requirements for product releases are determined based on a detailed sourcing plan or other types of product pull signals.
","itemType":1,"order":1},{"id":21808,"sectionId":8178,"title":"Definition","data":"The process of moving materials from suppliers or vendors into customer storage facilities. This process is part of the inbound logistics order management process. Inbound order management entails various activities, including planning, directing, monitoring, and controlling the processes related to purchase orders, such as outsourcing logistics service providers, coordinating documentation, tracking, and tracing shipments.
","itemType":1,"order":1},{"id":21813,"sectionId":8179,"title":"Definition","data":"The process and activities of receiving products to contract requirements. By planning the receiving operation, logistics professionals can schedule inbound shipments so that they can be quickly unloaded and moved from the receiving area into the storage location. This process is facilitated by coordinating shipment arrivals with labor availability and preparing crews for a shipment’s anticipated unloading needs (e.g., special equipment). Pre-receiving arrangements include:
The process and activities required to determine a product or service's conformance to specifications and the statement of work. It entails sampling, verifying marks, and testing to accept or reject products and services.
","itemType":1,"order":1},{"id":21823,"sectionId":8181,"title":"Definition","data":"The process of transferring accepted products to the appropriate stocking location within the organization. This process includes all the activities associated with repackaging, staging, moving, and stocking products. For services, this is the transfer or application of a service to the final customer or end user.
","itemType":1,"order":1},{"id":21828,"sectionId":8182,"title":"Definition","data":"The process of authorizing payments and paying suppliers for products or services. This process includes invoice collection, invoice matching with receiving, and the issuance of payment.
","itemType":1,"order":1},{"id":21833,"sectionId":8183,"title":"Definition","data":"The process associated with the return and disposition decisions for business reasons, agreements, or arrangements such as defective, excess, or for maintaining or repairing. This process can apply to:
The process of initiating a source return. Upon notification of a non-conformity resulting from inspection or another source, such as near expiry product, defect in the product, or malfunction. The organization initiates the return of the product(s) to the next entity in the upstream supply network.
","itemType":1,"order":1},{"id":21843,"sectionId":8185,"title":"Definition","data":"The process of requesting and obtaining authorization to return a product to a supplier or service provider. In addition, the customer must receive information such as return replacement or credit, packaging, handling, transportation, and import and export requirements to facilitate the efficient return of the product.
","itemType":1,"order":1},{"id":21848,"sectionId":8186,"title":"Definition","data":"The process of assigning a reason for the return of the product, such as the degree, class, and nature of the defect. Other return reasons include a return for repair, excess stock, expired replacement, recall, Third-Party Disposal, salvage, Third-Party Sale (secondary markets), rework, remanufacture/refurbish, modify, repair, Return to Vendor, resale, scrap/destroy.
","itemType":1,"order":1},{"id":21853,"sectionId":8187,"title":"Definition","data":"The process of developing the logistics of the return, such as scheduling for a carrier to pick up the defective product for delivery to the supplier. The logistics activities may depend on the contractual agreements between the supplier and the organization.
Activities could also include:
Alternatively, coordinating with the supplier for the return process if the supplier is held contractually accountable for that.
","itemType":1,"order":1},{"id":21858,"sectionId":8188,"title":"Definition","data":"The process of closing or adjusting the return order upon completion of the return process. In addition, the return order status is changed to Complete. This process can be manual or automated.
","itemType":1,"order":1},{"id":21863,"sectionId":8189,"title":"Definition","data":"The Transform process describes the activities associated with the creation of products (e.g., production, assembly/disassembly, MRO) and services.
","itemType":5,"order":1},{"id":21868,"sectionId":8190,"title":"Definition","data":"The process of transforming raw materials, ingredients, components, or sub-assemblies to create a tangible product through labor, machinery, tools, and biological or chemical processing or formulation.
","itemType":5,"order":1},{"id":21873,"sectionId":8191,"title":"Definition","data":"The process associated with the engineering or configuration activities required after an order's acceptance but before the product or deliverable can be produced. This process may include generating and delivering final drawings, specifications, formulas, or part programs. In general, this is the last step in completing any preliminary engineering work done as part of the quotation process.
","itemType":1,"order":1},{"id":21878,"sectionId":8192,"title":"Definition","data":"The process of scheduling and managing the execution of the activities required to create a product. Scheduling is typically done according to plans to produce specific parts, or product formulations, in specified quantities and the planned availability of required sourced products. This process includes sequencing and, depending on the factory layout, any standards for setup and run. Intermediate production or value-adding activities are generally coordinated before scheduling the operations needed to create a finished product.
","itemType":1,"order":1},{"id":21883,"sectionId":8193,"title":"Definition","data":"The process associated with the selection and physical movement of sourced or in-process products, including raw materials, fabricated components, subassemblies, required ingredients, and intermediate formulations or services, from a stocking or resource location to a specific point-of-use location. Issuing a product or resource includes the corresponding system transactions. The bill of materials or bill of service, routing information, and recipe or production instructions will determine the products to be issued to support the production operation(s).
","itemType":1,"order":1},{"id":21888,"sectionId":8194,"title":"Definition","data":"The series of activities performed on sourced and in-process products to convert them from a raw or semi-finished state to a state of completion and greater value.
","itemType":1,"order":1},{"id":21893,"sectionId":8195,"title":"Definition","data":"The activities associated with inspection. These activities include examination and testing. Examination can be visual or dimensional, relying on the human senses or using simple methods of measurement and handling. Testing includes techniques by which functional, measurable characteristics, operability, supportability, or performance capability are quantitatively verified when subjected to controlled conditions that are real or simulated. Inspection is generally non-destructive and typically includes sight, hearing, smell, touch, taste, simple physical manipulation, mechanical and electrical gauging, and measurement. Testing often uses special test equipment or instrumentation to obtain accurate quantitative data to be analyzed.
","itemType":1,"order":1},{"id":21898,"sectionId":8196,"title":"Definition","data":"The activities that containerize completed products for storage or sale to end users. Within certain industries, package activities may include cleaning or sterilization. Package activities do not apply to services.
","itemType":1,"order":1},{"id":21903,"sectionId":8197,"title":"Definition","data":"The activities associated with the post-production documentation, testing, or certification required before delivering a finished product to the end customer. Examples include the assembly of batch records for regulatory agencies, laboratory tests for potency or purity, the creation of certificates of analysis or other quality records, and sign-off by the quality organization.
","itemType":1,"order":1},{"id":21908,"sectionId":8198,"title":"Definition","data":"The activities associated with collecting and managing waste or surplus produced during the value-add and testing processes. Waste or surplus can include scrap material, unused resources, and non-conforming products or deliverables.
","itemType":1,"order":1},{"id":21913,"sectionId":8199,"title":"Definition","data":"The process of scheduling, maintaining and dispositioning of product transformation assets developed for supply chain execution. This includes installation, calibration and other activities necessary to sustain supply chain execution.
","itemType":1,"order":1},{"id":21918,"sectionId":8200,"title":"Definition","data":"The processes associated with delivering value to customers by facilitating outcomes customers want to achieve, but without the ownership of specific costs and risks.
","itemType":5,"order":1},{"id":21922,"sectionId":8201,"title":"Definition","data":"The activities associated with determining the optimal location, layout for effective customer flow and work flow, procedures and job definitions for service providers, measures to ensure quality, the extent of customer involvement, equipment selection, and adequate service capacity.
","itemType":1,"order":1},{"id":21926,"sectionId":8202,"title":"Definition","data":"The activities associated with outlining the services that need to be performed by the service provider, including the customer expectations related to the quality of work, volume of work, precision, accuracy, responsiveness, speed, and efficiency.
","itemType":1,"order":1},{"id":21930,"sectionId":8203,"title":"Definition","data":"The process associated with determining and managing the service system capacity and utilization by better matching the supply of and demand for service.
","itemType":1,"order":1},{"id":21934,"sectionId":8204,"title":"Definition","data":"The activities associated with collecting and identifying the skills and resources currently available in the supply chain. Generally, this information is collected and organized by entity, such as supply chain node, department, function, or a combination of these. Examples of this process include data collection for various service components, including servers, serving stations, and queues.
","itemType":1,"order":1},{"id":21938,"sectionId":8205,"title":"Definition","data":"The activities associated with initiating a service action based on a request from a user, or a user’s authorized representative, which has been agreed upon as a regular part of service delivery. Failure or degradation of service is handled as an incident.
","itemType":1,"order":1},{"id":21942,"sectionId":8206,"title":"Definition","data":"The activities associated with matching skill or resource demands with the available skills or resources. The purpose of this process is to determine which skill or resource requirements (the demand) can be met using existing resources, determine which skill or resource requirements are not supported by currently available skills or resources (the gap) and determine the skills or resources for which no demand exists (excess). Resource and service component assignment happens both at the front office, where the customer contact occurs, and back-office, which is hidden from the customer and is often operated as a factory for efficiency.
","itemType":1,"order":1},{"id":21946,"sectionId":8207,"title":"Definition","data":"The activities associated with the performance of tasks or actions which provide value to a customer.
","itemType":1,"order":1},{"id":21950,"sectionId":8208,"title":"Definition","data":"The activities associated with comparing the differences between customers' expectations of a service and the perceptions of that service as it is delivered across various dimensions, including reliability, responsiveness, assurance, empathy, and tangibles.
","itemType":1,"order":1},{"id":21955,"sectionId":8209,"title":"Definition","data":"The activities associated with receiving acknowledgment from the customer, or their authorized representative, that the services were rendered as specified in the Service Order and that the customer accepts the terms and conditions of the agreement and the Service Order.
","itemType":1,"order":1},{"id":21958,"sectionId":8210,"title":"Definition","data":"The activities associated with requesting customer payment for the services rendered and providing acknowledgment to the customer stating that the payment has been received.
","itemType":1,"order":1},{"id":21961,"sectionId":8211,"title":"Definition","data":"The activities associated with ending the contractual relationship. Terminations could be due to completion or an impossibility of performance, mutual agreement, breach of contract, or rescission.
","itemType":1,"order":1},{"id":21963,"sectionId":8212,"title":"Definition","data":"The activities associated with regaining possession of the resources and service components commissioned during the service provision.
","itemType":1,"order":1},{"id":21966,"sectionId":8213,"title":"Definition","data":"The activities associated with collecting and managing waste or surplus produced during all stages of the service life cycle - introduction, growth, maturity, and decline. Waste or surplus can include scrap material, unused resources, and non-conforming products or deliverables.
","itemType":1,"order":1},{"id":21971,"sectionId":8214,"title":"Definition","data":"The processes associated with keeping or restoring an asset to its working condition.
","itemType":5,"order":1},{"id":21976,"sectionId":8215,"title":"Definition","data":"The activities associated with receiving and verifying the returned MRO item against the return authorization and other documentation and preparing the item for transfer. This process also applies to items that are being returned for retesting or upgrading.
","itemType":1,"order":1},{"id":21981,"sectionId":8216,"title":"Definition","data":"The activities associated with determining whether or not to repair, maintain or overhaul the item, what repair, maintenance, or overhaul is required, and who the appropriate MRO service provider would be to repair, maintain or overhaul the item. Possible outputs include decisions to send a return authorization request to the service provider, send the product back into service without returning or repairing it, or discard the item. This process also applies to items that are being returned for retesting or upgrading.
","itemType":1,"order":1},{"id":21986,"sectionId":8217,"title":"Definition","data":"The process of a customer requesting and obtaining authorization from an MRO service provider for the return of a maintenance, repair, and overhaul product. In addition to discussing the maintenance, repair, and overhaul issue, the customer and MRO service provider should discuss enabling conditions such as return replacement or credit, packaging, handling, transportation, and import and export requirements to facilitate the efficient return of the maintenance, repair, and overhaul product to the MRO service provider. This process also applies to items that are being returned for retesting or upgrading.
","itemType":1,"order":1},{"id":21991,"sectionId":8218,"title":"Definition","data":"The activities associated with collecting and identifying the skills and resources currently available in the supply chain. Generally, this information is collected and organized by entity, such as supply chain node, department, function, or a combination of these. Examples of this process include data collection for standard headcount reports. Headcounts should include temporary staff and outsourced resources.
","itemType":1,"order":1},{"id":21995,"sectionId":8219,"title":"Definition","data":"The activities associated with a customer developing the schedule for a carrier to pick up the MRO product and deliver it to the MRO service provider. Activities include:
This process also applies to items that are being returned for retesting or upgrading.
","itemType":1,"order":1},{"id":22000,"sectionId":8220,"title":"Definition","data":"The process associated with the selection and physical movement of sourced or in-process products, including raw materials, fabricated components, subassemblies, required ingredients, and intermediate formulations or services, from a stocking or resource location to a specific point-of-use location. Issuing a product or resource includes the corresponding system transactions. The bill of materials or bill of service, routing information, and recipe or production instructions will determine the products to be issued to support the production operation(s).
","itemType":1,"order":1},{"id":22005,"sectionId":8221,"title":"Definition","data":"The activities associated with retaining or restoring an item in or to a state in which it can perform its required function. The actions include combining all technical and corresponding administrative, managerial, and supervision actions.
","itemType":1,"order":1},{"id":22010,"sectionId":8222,"title":"Definition","data":"The activities associated with inspection. These activities include examination and testing. Examination can be visual or dimensional, relying on the human senses or using simple methods of measurement and handling. Testing includes techniques by which functional, measurable characteristics, operability, supportability, or performance capability are quantitatively verified when subjected to controlled conditions that are real or simulated. Inspection is generally non-destructive and typically includes sight, hearing, smell, touch, taste, simple physical manipulation, mechanical and electrical gauging, and measurement. Testing often uses special test equipment or instrumentation to obtain accurate quantitative data to be analyzed.
","itemType":1,"order":1},{"id":22015,"sectionId":8223,"title":"Definition","data":"The activities that containerize completed products for storage or sale to end users. Within certain industries, package activities may include cleaning or sterilization. Package activities do not apply to services.
","itemType":1,"order":1},{"id":22020,"sectionId":8224,"title":"Definition","data":"The activities associated with the post-production documentation, testing, or certification required before delivering a finished product or service to the end customer. Examples include the assembly of batch records for regulatory agencies, laboratory tests for potency or purity, the creation of certificates of analysis or other quality records, and sign-off by the quality organization.
","itemType":1,"order":1},{"id":22025,"sectionId":8225,"title":"Definition","data":"The activities associated with collecting and managing waste or surplus produced during the value-add and testing processes. Waste or surplus can include scrap material, unused resources, and non-conforming products or deliverables.
","itemType":1,"order":1},{"id":22030,"sectionId":8226,"title":"Definition","data":"The process of scheduling, maintaining and dispositioning of MRO transformation assets developed for supply chain execution. This includes installation, repair, alteration, calibration and other activities necessary to sustain supply chain execution.
","itemType":1,"order":1},{"id":22035,"sectionId":8227,"title":"Definition","data":"The fulfill process describes the activities associated with fulfilling customer orders for products, including scheduling order delivery, picking, packing, shipping, assembling, installing, commissioning, and invoicing.
","itemType":5,"order":1},{"id":22040,"sectionId":8228,"title":"Definition","data":"The processes associated with commerce conducted between businesses and final consumers. Customer orders could be fulfilled by direct shipments or customer pick up. B2C order size is generally smaller and has fewer items per order than B2B orders.
","itemType":5,"order":1},{"id":22045,"sectionId":8229,"title":"Definition","data":"The activities related to receiving B2C product from Source or Transform, such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location that an organization performs at its own warehouses. May include quality inspection.
","itemType":1,"order":1},{"id":22050,"sectionId":8230,"title":"Definition","data":"The process of identifying on-hand and scheduled inventory and reserving it for specific orders. It also includes scheduling a delivery date. If a customer is picking up an order, the order availability date can be scheduled instead.
","itemType":1,"order":1},{"id":22055,"sectionId":8231,"title":"Definition","data":"The process of identifying on-hand and scheduled inventory reserved for specific orders. It also includes the scheduled delivery date. If a customer is picking up an order, the order availability date instead.
","itemType":1,"order":1},{"id":22060,"sectionId":8232,"title":"Definition","data":"The process of sorting and combining products, packing or kitting them, applying labels and bar codes, and delivering the products to the shipping area for loading.
","itemType":1,"order":1},{"id":22065,"sectionId":8233,"title":"Definition","data":"The process of moving packaged products or service resources into a temporary holding or waiting location to await movement to a delivery location. Products made to order may remain in the holding location to await shipment or transfer per the associated customer order.
","itemType":1,"order":1},{"id":22070,"sectionId":8234,"title":"Definition","data":"The process associated with planning product deliveries directly to end customers by coordinating multiple locations, routes, and drivers. It involves both route planning and delivery schedules.
","itemType":1,"order":1},{"id":22074,"sectionId":8235,"title":"Definition","data":"The process associated with keeping customers up to date on their order status and collaborating with the customer to obtain a mutually agreed time and location for product delivery.
","itemType":1,"order":1},{"id":22078,"sectionId":8236,"title":"Definition","data":"The process of loading products onto modes of transportation and generating the invoice and other documentation required to meet internal, customer, carrier, and government needs. This process may also include verifying the customer’s credit if that has not already been done.
","itemType":1,"order":1},{"id":22083,"sectionId":8237,"title":"Definition","data":"The process of shipping the product, digital or physical, to the customer.
","itemType":1,"order":1},{"id":22088,"sectionId":8238,"title":"Definition","data":"The process of preparing, verifying, installing, and validating the product at the customer site, if necessary. The product is fully functional upon validation.
","itemType":1,"order":1},{"id":22093,"sectionId":8239,"title":"Definition","data":"The activities of sorting and combining products, packing or kitting them, applying labels and bar codes, and delivering the products to the shipping area for loading.
","itemType":1,"order":1},{"id":22098,"sectionId":8240,"title":"Definition","data":"The process associated with commerce between two businesses rather than between a business and an individual consumer. Product is shipped directly to business customers, wholesalers, and retailers. B2B order size are generally larger and has more items per order than B2C.
","itemType":5,"order":1},{"id":22103,"sectionId":8241,"title":"Definition","data":"The activities related to receiving B2B product from Source or Transform, such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location that an organization performs at its own warehouses. May include quality inspection.
","itemType":1,"order":1},{"id":22108,"sectionId":8242,"title":"Definition","data":"The process of identifying on-hand and scheduled inventory reserved for specific orders. It also includes the scheduled delivery date. If a customer is picking up an order, the order availability date instead.
","itemType":1,"order":1},{"id":22113,"sectionId":8243,"title":"Definition","data":"The process of retrieving orders to pick, determining inventory availability, building the pick wave, picking the product, recording the pick, and delivering the products to shipping in response to an order.
","itemType":1,"order":1},{"id":22118,"sectionId":8244,"title":"Definition","data":"The process of sorting and combining products, packing or kitting them, applying labels and bar codes, and delivering the products to the shipping area for loading.
","itemType":1,"order":1},{"id":22123,"sectionId":8245,"title":"Definition","data":"The process of moving packaged products or service resources into a temporary holding or waiting location to await movement to a delivery location. Products made to order may remain in the holding location to await shipment or transfer per the associated customer order.
","itemType":1,"order":1},{"id":22128,"sectionId":8246,"title":"Definition","data":"The process associated with planning product deliveries directly to end customers by coordinating multiple locations, routes, and drivers. It involves both route planning and delivery schedules.
","itemType":1,"order":1},{"id":22133,"sectionId":8247,"title":"Definition","data":"The process associated with keeping customers up to date on their order status and collaborating with the customer to obtain a mutually agreed time and location for product delivery.
","itemType":1,"order":1},{"id":22138,"sectionId":8248,"title":"Definition","data":"The process of loading products onto modes of transportation and generating the invoice and other documentation required to meet internal, customer, carrier, and government needs. This process may also include verifying the customer's credit if that has not already been done.
","itemType":1,"order":1},{"id":22143,"sectionId":8249,"title":"Definition","data":"The process of sending a signal to the finance department to indicate that the order has been shipped and that the billing process should begin. The order can be closed if payment is received in advance. Otherwise, payment should be received from the customer within the payment terms of the invoice.
","itemType":1,"order":1},{"id":22148,"sectionId":8250,"title":"Definition","data":"The process of shipping the product, digital or physical, to the customer.
","itemType":1,"order":1},{"id":22153,"sectionId":8251,"title":"Definition","data":"The process of preparing, verifying, installing, and validating the product at the customer site, if necessary. The product is fully functional upon validation.
","itemType":1,"order":1},{"id":22158,"sectionId":8252,"title":"Definition","data":"The process of the customer receiving the product and verifying that the order is complete and that the product meets the delivery terms.
","itemType":1,"order":1},{"id":22163,"sectionId":8253,"title":"Definition","data":"The processes associated with fulfilling internal orders delivered to other business units within the same parent organization.
","itemType":5,"order":1},{"id":22168,"sectionId":8254,"title":"Definition","data":"The activities related to receiving Intra-company product from Source or Transform, such as receiving product, verifying, recording product receipt, determining put-away location, putting away and recording location that an organization performs at its own warehouses. May include quality inspection.
","itemType":1,"order":1},{"id":22173,"sectionId":8255,"title":"Definition","data":"The process of identifying on-hand and scheduled inventory and reserving it for specific orders. It also includes scheduling a delivery date. If a customer is picking up an order, the order availability date can be scheduled instead.
","itemType":1,"order":1},{"id":22178,"sectionId":8256,"title":"Definition","data":"The process of retrieving orders to pick, determining inventory availability, building the pick wave, picking the product, recording the pick, and delivering the products to shipping in response to an order.
","itemType":1,"order":1},{"id":22183,"sectionId":8257,"title":"Definition","data":"The process of sorting and combining products, packing or kitting them, applying labels and bar codes, and delivering the products to the shipping area for loading.
","itemType":1,"order":1},{"id":22188,"sectionId":8258,"title":"Definition","data":"The process of moving packaged products or service resources into a temporary holding or waiting location to await movement to a delivery location. Products made to order may remain in the holding location to await shipment or transfer per the associated internal order.
","itemType":1,"order":1},{"id":22193,"sectionId":8259,"title":"Definition","data":"The process associated with planning product deliveries to business unit customers by coordinating routes and drivers. It involves both route planning and delivery schedules.
","itemType":1,"order":1},{"id":22198,"sectionId":8260,"title":"Definition","data":"The process associated with keeping business unit customers up to date on their order status and collaborating with the business unit customer to obtain a mutually agreed time and docking location for product delivery.
","itemType":1,"order":1},{"id":22203,"sectionId":8261,"title":"Definition","data":"The process of loading products onto modes of transportation and generating the financial transaction required to meet internal, carrier, and government needs.
","itemType":1,"order":1},{"id":22208,"sectionId":8262,"title":"Definition","data":"The process of shipping the product, digital or physical, to the business unit.
","itemType":1,"order":1},{"id":22213,"sectionId":8263,"title":"Definition","data":"The process of preparing, verifying, installing, and validating the product at the customer site, if necessary. The product is fully functional upon validation.
","itemType":1,"order":1},{"id":22218,"sectionId":8264,"title":"Definition","data":"The process of the customer receiving the product and verifying that the order is complete and that the product meets the delivery terms.
","itemType":1,"order":1},{"id":22223,"sectionId":8265,"title":"Definition","data":"The process of sending a signal to the finance department to indicate that the order has been shipped and that the internal financial process should begin.
","itemType":1,"order":1},{"id":22228,"sectionId":8266,"title":"Definition","data":"The return process describes the activities associated with the reverse flow of goods, services, and/or any service components from a customer back through a supply/service chain to diagnose condition, evaluate entitlement, disposition back into Transform or other circular activities, and pre-position inventory or service.
","itemType":5,"order":1},{"id":22233,"sectionId":8267,"title":"Definition","data":"The process associated with the receipt, diagnosis, dispositioning, and positioning of returned products. Return activity includes decision-making associated with circular considerations, optimization of the return pathway, including across country borders, entitlement verifications, and inventory management considerations.
","itemType":5,"order":1},{"id":22238,"sectionId":8268,"title":"Definition","data":"The process is associated with a product return by an individual, organization, or third party. The return begins with an acceptance or rejection based on the Service Agreement Terms and Conditions. If the product is accepted, the product is authorized for return, and the product return is scheduled or accepted.
","itemType":1,"order":1},{"id":22243,"sectionId":8269,"title":"Definition","data":"The process associated with receiving a returned product by the OEM, OEM partner, last known holder, designated return center, or other service provider, such as an approved field engineer. A check is performed to compare product condition to any approved return authorization. The entity receiving the return may immediately initiate a rapid adjustment and either return the product to the customer or begin product return internally. The item is prepared for transfer/shipment if required.
","itemType":1,"order":1},{"id":22248,"sectionId":8270,"title":"Definition","data":"The process where the OEM, OEM partner, last known holder, designated return center, or other service provider, such as an approved field engineer, formally confirms receipt of the return product and closes the RMA order or formally adjusts the RMA/return order, notifying the required parties of details and acting on the updated closure/adjustment.
","itemType":1,"order":1},{"id":22250,"sectionId":8271,"title":"Definition","data":"The process associated with the testing and/or diagnosis of the returned product. Product condition is compared to the expected condition based on Customer input, remote sensing, or other reports. The original labeling of condition is confirmed, adjusted, or the product is sent for further testing/diagnosis.
","itemType":1,"order":1},{"id":22255,"sectionId":8272,"title":"Definition","data":"The process associated with the decision process by which the Return Product is channeled for immediate replacement into stock, refurbishment, recertification, upgrade, remanufacturing, reuse, repair, repurposing, recycling, disassembly with component dispositioning, reclamation, disposal, or another activity. Serial number tracing may be required.
","itemType":1,"order":1},{"id":22260,"sectionId":8273,"title":"Definition","data":"The process associated with requesting additional/updated documentation for the movement of the Returned Product. The request may include new tests, analysis, and regulatory documentation.
","itemType":1,"order":1},{"id":22263,"sectionId":8274,"title":"Definition","data":"The process associated with the signaling and physical movement of the product to the next location or storage, as per the dispositioning process. This process includes updating the database(s) with the product status and location, the condition of the product, and a notation of the change of ownership.
","itemType":1,"order":1},{"id":22268,"sectionId":8275,"title":"Definition","data":"The process associated with the adjustment of Financial Terms including issuing reimbursements, receipt of payment, and financial change(s) to terms and conditions. This process also includes adjusting the Contract/Service Agreement terms and conditions, including an allowance for an upgrade at the time of the return, waiving of requirements at the time of return, and the inclusion of temporary or permanent changes.
","itemType":1,"order":1},{"id":22273,"sectionId":8276,"title":"Definition","data":"The process associated with short-term or long-term storage for the returned product, also called On-Hold Inventory. Storage must meet regulatory requirements for security (cyber and physical), product tracking, environmental, and health protections.
","itemType":1,"order":1},{"id":22275,"sectionId":8277,"title":"Definition","data":"The process of gathering internal B2B product receipt data and distributing it among the required parties.
","itemType":1,"order":1},{"id":22280,"sectionId":8278,"title":"Definition","data":"The process associated with the receipt, diagnosis, and activity required of Returned Services. Service Return may be handled digitally, face-to-face, such as formal meetings or requests, or via other communication pathways. Financial, entitlement, environmental, and other considerations are included.
","itemType":5,"order":1},{"id":22285,"sectionId":8279,"title":"Definition","data":"The process associated with a Return Service request/requirement that is initiated via:
The entity verifies with the customer, in discussion and/or writing, the details of the service problem, verifies the ability and/or entitlement and/or approval process to make an adjustment, and the schedule for the adjustment process to begin.
","itemType":1,"order":1},{"id":22290,"sectionId":8280,"title":"Definition","data":"The process associated with a formal acknowledgment of the return of service and any associated change items requested by the customer and approved for action by the OEM, OEM partner, last known holder, designated service center, or other approved service provider. In some cases, the entity receiving the return may initiate a rapid adjustment/solution and reinstate the service immediately.
","itemType":1,"order":1},{"id":22295,"sectionId":8281,"title":"Definition","data":"The process associated with the receipt of Customer signoff/approval by the OEM, an OEM partner, last known holder, designated service center, or other approved service provider. The customer signoff means that the service requested has been received and worked on, and the fix is working as per specification. In some cases, the customer request is outside acceptable specification/contract/other limits and is adjusted based on additional conversation with the customer, or the service request may be canceled, a reason code sent, and the Service Change Order closed. Otherwise, closure is caused by the return of the product to the customer or a receipt of replacement from the customer.
","itemType":1,"order":1},{"id":22297,"sectionId":8282,"title":"Definition","data":"The process by which the Service Change is tested and/or diagnosed against the previously agreed service requirements and specifications. Original description/labeling of the condition is confirmed, adjusted, or sent for further testing/diagnosis.
","itemType":1,"order":1},{"id":22302,"sectionId":8283,"title":"Definition","data":"The process associated with the adjustment of financial terms, including issuing of reimbursements, receipt of payment, and adjustment to the financial terms and conditions included in the contract or service agreement. Adjustment of Contract/Service Agreement terms and conditions include:
The process associated with additional/updated documentation required for the Returned Service. The process may include design adjustment requirements, change requests, and aspects leading to non-compliance.
","itemType":1,"order":1},{"id":22310,"sectionId":8285,"title":"Definition","data":"The process associated with the signaling and movement of a Service Request to the next party in the service chain such as software design, configuration, service center support, partner support, and/or senior management.
","itemType":1,"order":1},{"id":22315,"sectionId":8286,"title":"Definition","data":"The process associated with the Maintenance, Repair, and Overhaul process set differentiates itself by returning the same product unit to the Return originating Customer, as verified by product Serial Number or other Unit ID means. In some instances, as per the Service Agreement or Contract, the replacement item may be a previously stocked repaired item. The Return MRO processes do not represent the actual maintenance, repair, or overhaul activities; these are generally represented by Transform processes.
","itemType":5,"order":1},{"id":22320,"sectionId":8287,"title":"Definition","data":"The process by which the OEM/company/government initiates a recall of the product. The OEM/company begins an update/upgrade/replacement based on the Service Agreement Terms and Conditions. The product is authorized for return due to the occurrence or anticipation of the risk of product failure/non-compliance; the entitlement to return is verified; the product return is scheduled. The product serial number is recorded and traced. Accepting the request may include negotiating the conditions of the return with the customer and authorizing a return replacement or credit. Rejecting the request would include providing the customer with a reason for the rejection.
","itemType":1,"order":1},{"id":22325,"sectionId":8288,"title":"Definition","data":"The process associated with receiving a returned MRO product by the OEM, OEM partner, last known holder, designated return/service center/depot, or approved entity. The unit serial number/unit ID and condition is verified against the return authorization and required documentation. If possible, the receiving entity or onsite field engineer will fix/adjust the product and immediately return the product to the customer. The item is prepared for transfer/shipment if required.
","itemType":1,"order":1},{"id":22330,"sectionId":8289,"title":"Definition","data":"The process associated with providing a quote to the customer by the OEM, OEM partner, last known holder, designated return/service center/depot, or approved entity, either remotely or onsite, for the anticipated MRO service due to out-of-warranty/service agreement condition. The unit cannot continue in the MRO process until the customer verifies the quote and approves the associated payment and other terms.
","itemType":1,"order":1},{"id":22333,"sectionId":8290,"title":"Definition","data":"The process associated with the testing and/or diagnosis of the returned MRO unit. Product condition is compared to the expected condition based on Customer input, remote sensing, or other reports. Original labeling of the condition is confirmed, adjusted, or sent for further testing/diagnosis.
","itemType":1,"order":1},{"id":22338,"sectionId":8291,"title":"Definition","data":"The process associated with the decision process by which the diagnosis/MRO testing results, country of ownership, and other attributes are used to initiate inventory requirements for required repair(s), confirm capacity at the location or applicable locations, compare the cost of unit's movement into and out of acceptable and allowed locations, and schedule within required time limits.
","itemType":1,"order":1},{"id":22343,"sectionId":8292,"title":"Definition","data":"The process associated with creating or updating the documentation required for Returned MRO product movement, status capture, and regulatory requirements.
","itemType":1,"order":1},{"id":22346,"sectionId":8293,"title":"Definition","data":"The process associated with the signaling and physical movement of the product to the next location, or storage, as per the dispositioning process. This process includes updating the database(s) with the product status and location, the condition of the product, and a notation of the change of ownership.
","itemType":1,"order":1},{"id":22351,"sectionId":8294,"title":"Definition","data":"The process associated with the adjustment of Financial Terms including issuing reimbursements, receipt of payment, and financial change(s) to terms and conditions. This process also includes adjusting the Contract/Service Agreement terms and conditions, including an allowance for an upgrade at the time of the return, waiving of requirements at the time of return, and the inclusion of temporary or permanent changes or adjustments based on country legal requirements.
","itemType":1,"order":1},{"id":22356,"sectionId":8295,"title":"Definition","data":"The process associated with temporary storage for returned product. Storage must meet regulatory requirements for security (cyber and physical), product tracking, environmental and health protections, and country legal requirements for product movement and timing.
","itemType":1,"order":1},{"id":22358,"sectionId":8296,"title":"Definition","data":"The percentage of orders meeting delivery performance expectations, including complete and accurate documentation and no delivery damage. According to the APICS Dictionary, a perfect order satisfies the seven R’s: the right product and/or service, the right quantity, the right condition, the right place, the right time (which should be measured by the customer’s definition of on time), the right customer and the right cost. Perfect Order Fulfillment addresses all of these and considers the presence of all proper documentation, including packing slips, bills of lading, invoices and more.
Right product and/or service and right quantity are grouped into the level-2 metric Percentage of Orders Delivered in Full to the Customer (RL.2.1). Right time, right location and right customer are grouped into the level-2 metric Delivery Performance to Original Customer Commit Date (RL.2.2). Right condition is measured by the level-2 metric Customer Order Perfect Condition (RL.2.4). Right cost is measured by the overall Cost strategic attribute. Lastly, proper documentation is measured by Customer Order Documentation Accuracy (RL.2.3).
","itemType":1,"order":1},{"id":22365,"sectionId":8297,"title":"Definition","data":"The percentage of orders in which all of the items are received by the appropriate customer in the quantities committed.
","itemType":1,"order":1},{"id":22371,"sectionId":8298,"title":"Definition","data":"The percentage of orders that are fulfilled to the customer's originally committed date.
","itemType":1,"order":1},{"id":22378,"sectionId":8299,"title":"Definition","data":"Percentage of orders with on time and accurate documentation supporting the order. This documentation can include packing slips, bills of lading (BOLs), invoices and other documents.
","itemType":1,"order":1},{"id":22385,"sectionId":8300,"title":"Definition","data":"The percentage of orders delivered in an undamaged state that meet specification, have the correct configuration, are faultlessly installed (as applicable) and are accepted by the customer.
","itemType":1,"order":1},{"id":22392,"sectionId":8301,"title":"Definition","data":"The percentage of orders from the supplier meeting delivery performance expectations, including complete and accurate documentation and no delivery damage. According to the APICS Dictionary, a perfect order satisfies the seven R’s: the right product, the right quantity, the right condition, the right place, the right time (which should be measured by the customer’s definition of on time), the right customer and the right cost. Perfect Supplier Order Fulfillment addresses all of these and considers the presence of all proper documentation, including packing slips, bills of lading, invoices and more. Right product and right quantity are grouped into the level-2 metric Percentage of Orders Delivered In Full from the Supplier (RL.2.5). Right time, right location, and right customer are grouped into the level-2 metric Delivery Performance to Original Supplier Commit Date (RL.2.6), Right condition is measured by the level-2 metric Supplier Order Perfect Condition (RL.2.8). Right cost is measured by the overall Cost strategic attribute. Lastly, proper documentation is measured by Supplier Order Documentation Accuracy (RL.2.7).
","itemType":1,"order":1},{"id":22396,"sectionId":8302,"title":"Definition","data":"The percentage of orders in which all the items are received from the supplier in the quantities committed.
","itemType":1,"order":1},{"id":22400,"sectionId":8303,"title":"Definition","data":"The percentage of orders that are fulfilled on or before the internal Commit date, used as a measure of internal scheduling systems' effectiveness. Delivery measurements are based on the date a complete order is shipped or the ship-to date of a complete order. A complete order has all items on the order delivered in the quantities requested. An order must be complete to be considered fulfilled. Multiple line items on a single order with different planned delivery dates constitute multiple orders, and multiple planned delivery dates on a single line item also constitute multiple orders.
","itemType":1,"order":1},{"id":22405,"sectionId":8304,"title":"Definition","data":"Percentage of orders with on time and accurate documentation supporting the order. This documentation can include packing slips, bills of lading (BOLs), invoices and other documents.
","itemType":1,"order":1},{"id":22409,"sectionId":8305,"title":"Definition","data":"The percentage of orders delivered in an undamaged state that meet specification, have the correct configuration, are faultlessly installed (as applicable) and are accepted.
","itemType":1,"order":1},{"id":22413,"sectionId":8306,"title":"Definition","data":"The percentage of orders delivery performance expectations, including complete and accurate documentation and no delivery damage. According to the APICS Dictionary, a perfect order satisfies the seven R’s: the right product, the right quantity, the right condition, the right place, the right time (which should be measured by the customer’s definition of on time), the right customer and the right cost. Perfect Return Order Fulfillment addresses all of these and considers the presence of all proper documentation, including packing slips, bills of lading, invoices and more. Right product and right quantity are grouped into the level-2 metric On Time (RL.2.9). Right time, right location and right customer are grouped into the level-2 metric Delivery Performance to In Full (Correct Product) (RL.2.10). Right condition is measured by the level-2 metric Perfect Condition (RL.2.12). Right cost is measured by the overall Cost strategic attribute. Lastly, proper documentation is measured by Correct Documentation (RL.2.11).
","itemType":1,"order":1},{"id":22417,"sectionId":8307,"title":"Definition","data":"Percentage of order that arrive on time to anticipated arrival date based on the schedule established by the RMA
","itemType":1,"order":1},{"id":22420,"sectionId":8308,"title":"Definition","data":"Percentage of orders where the quantity of product received matches the quantity of product authorized for return from the customer, including product type and quantity
","itemType":1,"order":1},{"id":22423,"sectionId":8309,"title":"Definition","data":"Percentage of orders with on time and accurate documentation supporting the order. This documentation can include packing slips, bills of lading (BOLs), invoices and other documents.
","itemType":1,"order":1},{"id":22426,"sectionId":8310,"title":"Definition","data":"Percentage of orders that arrive in the anticipated condition, with no damage caused during the shipping process. Damage could include damage to the returned product over and above the original product nonconformance (if returned for reasons of defect and/or MRO) or damage to the shipment container itself.
","itemType":1,"order":1},{"id":22430,"sectionId":8312,"title":"Definition","data":"The percentage of orders in which all items ordered by the customer are the items actually provided and no extra items are provided.
","itemType":1,"order":1},{"id":22432,"sectionId":8313,"title":"Definition","data":"The percentage of orders in which all quantities received by the customer match the ordered quantities, within mutually agreed tolerances.
","itemType":1,"order":1},{"id":22434,"sectionId":8314,"title":"Definition","data":"The percentage of orders that are received by the customer commit date.
","itemType":1,"order":1},{"id":22436,"sectionId":8315,"title":"Definition","data":"The percentage of orders that are delivered to the correct location and customer entity.
","itemType":1,"order":1},{"id":22438,"sectionId":8316,"title":"Definition","data":"The percentage of compliance documents that are complete, correct and readily available when and how the customer, government or other supply chain regulatory entities require. Compliance documentation includes material safety data sheets.
","itemType":1,"order":1},{"id":22440,"sectionId":8317,"title":"Definition","data":"The percentage of other required documentation (beyond compliance documentation, payment documentation and shipping documentation) that is complete, correct and readily available when and how it is expected by the customer, government and other supply chain regulatory entities. This kind of documentation includes quality certification documents.
","itemType":1,"order":1},{"id":22442,"sectionId":8318,"title":"Definition","data":"The percentage of payment documents that are complete, correct and readily available when and how they are expected by the customer, government, and other supply chain regulatory entities. Payment documents include invoices and contractual outline agreements.
","itemType":1,"order":1},{"id":22444,"sectionId":8319,"title":"Definition","data":"The percentage of shipping documents that are complete, correct and readily available when and how they are expected by the customer, government, and other supply chain regulatory entities. Shipping documents include packing slips for customers, bills of lading for carriers, and government or customs documentation and forms.
","itemType":1,"order":1},{"id":22446,"sectionId":8320,"title":"Definition","data":"Number of faultless installations divided by the total number of installations and then multiplied by 100.
","itemType":1,"order":1},{"id":22448,"sectionId":8321,"title":"Definition","data":"The number of customer orders or lines that are processed damage free divided by the total number of customer orders or lines processed in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22450,"sectionId":8322,"title":"Definition","data":"The percentage of orders that are delivered without damage.
","itemType":1,"order":1},{"id":22452,"sectionId":8323,"title":"Definition","data":"The percentage of orders that are delivered without defects.
","itemType":1,"order":1},{"id":22454,"sectionId":8324,"title":"Definition","data":"The percentage of orders in which all items ordered from the supplier are the items actually provided and no extra items are provided.
","itemType":1,"order":1},{"id":22456,"sectionId":8325,"title":"Definition","data":"The percentage of orders in which all quantities delivered by the supplier match the ordered quantities, within mutually agreed tolerances.
","itemType":1,"order":1},{"id":22458,"sectionId":8326,"title":"Definition","data":"The percentage of orders that are received by the organization's commit date.
","itemType":1,"order":1},{"id":22460,"sectionId":8327,"title":"Definition","data":"The percentage of orders that are delivered to the correct organization location.
","itemType":1,"order":1},{"id":22462,"sectionId":8328,"title":"Definition","data":"The percentage of compliance documents that are complete, correct and readily available when and how the organization, government or other supply chain regulatory entities require. Compliance documentation includes material safety data sheets.
","itemType":1,"order":1},{"id":22464,"sectionId":8329,"title":"Definition","data":"The percentage of other required documentation (beyond compliance documentation, payment documentation and shipping documentation) that is complete, correct and readily available when and how it is expected by the organization, government, and other supply chain regulatory entities. This kind of documentation includes quality certification documents.
","itemType":1,"order":1},{"id":22466,"sectionId":8330,"title":"Definition","data":"The percentage of payment documents that are complete, correct and readily available when and how they are expected by the organization, government, and other supply chain regulatory entities. Payment documents include invoices and contractual outline agreements.
","itemType":1,"order":1},{"id":22468,"sectionId":8331,"title":"Definition","data":"The percentage of shipping documents that are complete, correct and readily available when and how they are expected by the organization, government, and other supply chain regulatory entities. Shipping documents include packing slips for the organization, bills of lading for carriers, and government or customs documentation and forms.
","itemType":1,"order":1},{"id":22470,"sectionId":8332,"title":"Definition","data":"The number of faultless installations divided by the total number of installations and then multiplied by 100.
","itemType":1,"order":1},{"id":22472,"sectionId":8333,"title":"Definition","data":"The number of supplier orders or lines that are processed damage free divided by the total number of supplier orders or lines processed in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22474,"sectionId":8334,"title":"Definition","data":"The percentage of supplier orders that are delivered without damage.
","itemType":1,"order":1},{"id":22476,"sectionId":8335,"title":"Definition","data":"The percentage of supplier orders that are delivered without defects.
","itemType":1,"order":1},{"id":22478,"sectionId":8336,"title":"Definition","data":"The number of returns within the warranty period. A 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.
","itemType":1,"order":1},{"id":22480,"sectionId":8337,"title":"Definition","data":"The number of record keeping-related regulatory violations received per year.
","itemType":1,"order":1},{"id":22482,"sectionId":8338,"title":"Definition","data":"The percentage of MRO products returned to service.
","itemType":1,"order":1},{"id":22484,"sectionId":8339,"title":"Definition","data":"The percentage of items that are located in the correct place.
","itemType":1,"order":1},{"id":22486,"sectionId":8340,"title":"Definition","data":"The percentage of excess product returns delivered as complete to the designated return center. To be considered complete, the returned product must be delivered to the correct place, at the scheduled time, and with the correct part and documentation.
","itemType":1,"order":1},{"id":22488,"sectionId":8341,"title":"Definition","data":"The number of invoices processed without errors divided by the total number of invoices and then multiplied by 100. Examples of potential invoice defects are wrong customer information, wrong product information, wrong price, wrong quantity, wrong terms, or wrong date. Incorrect invoices can also include changes to the customer order that were not approved by the customer.
","itemType":1,"order":1},{"id":22490,"sectionId":8342,"title":"Definition","data":"Percentage of MRO items delivered to the correct service provider location.
","itemType":1,"order":1},{"id":22492,"sectionId":8343,"title":"Definition","data":"The number of products that meet desired environmental performance specifications divided by the total number of products produced and then multiplied by 100.
","itemType":1,"order":1},{"id":22494,"sectionId":8344,"title":"Definition","data":"The number of products with proper environmental labels in place divided by the total number of products produced and then multiplied by 100.
","itemType":1,"order":1},{"id":22496,"sectionId":8345,"title":"Definition","data":"The number of suppliers that completely meet environmental criteria divided by the total number of suppliers used and then multiplied by 100.
","itemType":1,"order":1},{"id":22498,"sectionId":8346,"title":"Definition","data":"Percentage of suppliers used that have a validated Environmental Management System, or ISO 140001, certification.
","itemType":1,"order":1},{"id":22500,"sectionId":8347,"title":"Definition","data":"The number of orders or lines that are processed complete divided by the total number of orders or lines processed within the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22502,"sectionId":8348,"title":"Definition","data":"The number of orders or lines that are received defect free divided by the total number of orders or lines processed in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22504,"sectionId":8349,"title":"Definition","data":"The number of orders or lines that are received on time to the demand requirements divided by the total number of orders or lines for the demand requirements in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22506,"sectionId":8350,"title":"Definition","data":"The percentage of orders or lines received with the right type and quantity of content.
","itemType":1,"order":1},{"id":22508,"sectionId":8351,"title":"Definition","data":"The percentage of orders or lines received that are packaged correctly with the right type and quantity of packaging material.
","itemType":1,"order":1},{"id":22510,"sectionId":8352,"title":"Definition","data":"The number of orders or lines that are received on time with the correct shipping documents divided by the total number of orders or lines processed in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22512,"sectionId":8353,"title":"Definition","data":"The number of product orders or lines that are transferred on time to demand requirements divided by the total number of orders or lines transferred in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22514,"sectionId":8354,"title":"Definition","data":"The number of transactions processed without errors divided by the total number of transactions processed in the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22516,"sectionId":8355,"title":"Definition","data":"The number of schedules that are changed within the suppliers’ lead time divided by the total number of schedules generated within the measurement period and then multiplied by 100.
","itemType":1,"order":1},{"id":22518,"sectionId":8356,"title":"Definition","data":"The number of shipping schedules that support the customer-required return-by date divided by the total number of shipping schedules and then multiplied by 100.
","itemType":1,"order":1},{"id":22520,"sectionId":8357,"title":"Definition","data":"A measure of delivery performance of finished goods or other cargo, usually expressed as a percentage. In a make-to-stock company, this percentage usually represents the number of items or dollars (on one or more customer orders) that were shipped on schedule for a specific time period, compared with the total that were supposed to be shipped in that time period. In a make-to-order company, usually some comparison of the number of jobs or dollars shipped in a given time period (e.g., a week) compared with the number of jobs or dollars that were supposed to be shipped in that time period.
","itemType":1,"order":1},{"id":22522,"sectionId":8358,"title":"Definition","data":"Forecast Accuracy is calculated in number of units for each product or product family.
Common calculation to determine percentage error: ([Sum actuals - sum of variance] / sum actuals) x 100.
Success rates can be determined by monitoring the delta of Forecast Accuracy compared with the actual Forecast Accuracy.
","itemType":1,"order":1},{"id":22524,"sectionId":8359,"title":"Definition","data":"The number of times in which a product is sent to the wrong return center.
","itemType":1,"order":1},{"id":22526,"sectionId":8360,"title":"Definition","data":"The number of instances in which excessive inventory is returned and followed.
","itemType":1,"order":1},{"id":22528,"sectionId":8361,"title":"Definition","data":"The number of return shipments that are shipped on time.
","itemType":1,"order":1},{"id":22530,"sectionId":8362,"title":"Definition","data":"The percentage of time that a plant achieves its production schedule. This calculation is based on the number of scheduled end-items or the total volume for a specific period. Note: Over shipments do not make up for under shipments.
","itemType":1,"order":1},{"id":22532,"sectionId":8363,"title":"Definition","data":"Warranty costs include materials, labor, and the cost of determining product defects.
","itemType":1,"order":1},{"id":22534,"sectionId":8364,"title":"Definition","data":"The number of waste transactions with errors as a percent of total waste transactions.
","itemType":1,"order":1},{"id":22536,"sectionId":8365,"title":"Definition","data":"The ratio of usable output from a process to its input.
","itemType":1,"order":1},{"id":22538,"sectionId":8366,"title":"Definition","data":"The condition that occurs when the output of a process is not consistently repeatable in quantity, quality, or a combination of these. Yield is defined as the amount of good or acceptable material available after the completion of a process and is calculated by dividing the final amount by the initial amount and multiplying that by 100%. The actual yield will vary about the mean.
","itemType":1,"order":1},{"id":22540,"sectionId":8367,"title":"Definition","data":"Total number of Returns received in full / total number of returns received
Correct item return = Total number of correct Returned items/Total items returned. Includes correct SN unit when required.
","itemType":1,"order":1},{"id":22542,"sectionId":8368,"title":"Definition","data":"Total lines of Return units received in full/Total lines
","itemType":1,"order":1},{"id":22543,"sectionId":8369,"title":"Definition","data":"Uptime is a measure of how much of the time the customer’s systems and equipment are in use and functioning as expected, versus unplanned downtime from unexpected failures.
","itemType":1,"order":1},{"id":22545,"sectionId":8370,"title":"Definition","data":"The percentage of orders that are fulfilled on or before the customer's requested date used as a measure of responsiveness to market demand. Delivery measurements are based on the date a complete order is shipped or the ship-to date of a complete order. A complete order has all items on the order delivered in the quantities requested. An order must be complete to be considered fulfilled. Multiple line items on a single order with different planned delivery dates constitute multiple orders, and multiple planned delivery dates on a single line item also constitute multiple orders.
Delivery Performance to Customer Request Date = [Total number of orders delivered in full and on time to the customer's request date] / [Total number of orders delivered] X 100%
","itemType":1,"order":1},{"id":22547,"sectionId":8371,"title":"Definition","data":"The percentage of orders that are fulfilled on or before the customer's requested date used as a measure of responsiveness to market demand. Delivery measurements are based on the date a complete order is shipped or the ship-to date of a complete order. A complete order has all items on the order delivered in the quantities requested. An order must be complete to be considered fulfilled. Multiple line items on a single order with different planned delivery dates constitute multiple orders, and multiple planned delivery dates on a single line item also constitute multiple orders.
[Total number of orders delivered in full and on time to the customer's request date] / [Total number of orders delivered] X 100%
","itemType":1,"order":1},{"id":22549,"sectionId":8372,"title":"Definition","data":"The average actual cycle time consistently achieved to fulfill customer orders. For each individual order, this cycle time starts at the order receipt and ends at customer acceptance of the order.
","itemType":1,"order":1},{"id":22556,"sectionId":8373,"title":"Definition","data":"The average amount of time associated with Order processes.
","itemType":1,"order":1},{"id":22560,"sectionId":8374,"title":"Definition","data":"The average amount of time associated with Source processes.
","itemType":1,"order":1},{"id":22566,"sectionId":8375,"title":"Definition","data":"The average time associated with Transform processes.
","itemType":1,"order":1},{"id":22572,"sectionId":8376,"title":"Definition","data":"The average time associated with Fulfill processes.
","itemType":1,"order":1},{"id":22578,"sectionId":8377,"title":"Definition","data":"The average time associated with Return processes.
","itemType":1,"order":1},{"id":22582,"sectionId":8379,"title":"Definition","data":"Percentage of Orders booked, processed, and managed in a perfect way
Comprehensive and correct data in order to enter an order in the system (first time right)
","itemType":1,"order":1},{"id":22583,"sectionId":8380,"title":"Definition","data":"The average time associated with building shipment loads.
","itemType":1,"order":1},{"id":22584,"sectionId":8381,"title":"Definition","data":"The average time required for customer order consolidation.
","itemType":1,"order":1},{"id":22585,"sectionId":8382,"title":"Definition","data":"The average time associated with receiving and verifying an order at the customer site.
","itemType":1,"order":1},{"id":22587,"sectionId":8383,"title":"Definition","data":"The average time associated with reserving resources and determining a delivery date.
","itemType":1,"order":1},{"id":22589,"sectionId":8384,"title":"Definition","data":"The average time associated with authorizing payment to suppliers.
","itemType":1,"order":1},{"id":22591,"sectionId":8385,"title":"Definition","data":"The average time associated with the identification of sources of supply.
","itemType":1,"order":1},{"id":22593,"sectionId":8386,"title":"Definition","data":"The average time associated with receiving product.
","itemType":1,"order":1},{"id":22595,"sectionId":8387,"title":"Definition","data":"The average time associated with scheduling the shipment of the return of a maintenance, repair, and overhaul product.
","itemType":1,"order":1},{"id":22597,"sectionId":8388,"title":"Definition","data":"The average time associated with selecting a supplier and negotiating.
","itemType":1,"order":1},{"id":22599,"sectionId":8389,"title":"Definition","data":"The average amount of time associated with the transfer of a product from one process or location to the next process or location.
","itemType":1,"order":1},{"id":22601,"sectionId":8390,"title":"Definition","data":"The average time associated with verifying raw materials.
","itemType":1,"order":1},{"id":22603,"sectionId":8391,"title":"Definition","data":"The average time associated with the finalization of production engineering.
","itemType":1,"order":1},{"id":22605,"sectionId":8392,"title":"Definition","data":"The average time associated with the issuance of material to production.
","itemType":1,"order":1},{"id":22607,"sectionId":8393,"title":"Definition","data":"The average time associated with production and testing.
","itemType":1,"order":1},{"id":22609,"sectionId":8394,"title":"Definition","data":"The average time associated with releasing a finished product to Fulfill.
","itemType":1,"order":1},{"id":22611,"sectionId":8395,"title":"Definition","data":"The average time associated with scheduling production activities.
","itemType":1,"order":1},{"id":22613,"sectionId":8396,"title":"Definition","data":"The average time associated with staging finished product.
","itemType":1,"order":1},{"id":22615,"sectionId":8397,"title":"Definition","data":"The average time associated with packaging the product in the Transform process.
","itemType":1,"order":1},{"id":22617,"sectionId":8398,"title":"Definition","data":"The average time associated with product installation.
","itemType":1,"order":1},{"id":22619,"sectionId":8399,"title":"Definition","data":"The average time associated with product loading and the generation of shipping documentation.
","itemType":1,"order":1},{"id":22621,"sectionId":8400,"title":"Definition","data":"The average time associated with packing a product for shipment.
","itemType":1,"order":1},{"id":22623,"sectionId":8401,"title":"Definition","data":"The average time associated with picking a product.
","itemType":1,"order":1},{"id":22625,"sectionId":8402,"title":"Definition","data":"The average time associated with receiving and verifying an order at the customer site.
","itemType":1,"order":1},{"id":22627,"sectionId":8403,"title":"Definition","data":"The average time associated with receiving a transfer of product to Fulfill processes from Source or Transform.
","itemType":1,"order":1},{"id":22629,"sectionId":8404,"title":"Definition","data":"The average time associated with routing shipments.
","itemType":1,"order":1},{"id":22630,"sectionId":8405,"title":"Definition","data":"The average time associated with scheduling the installation of a product.
","itemType":1,"order":1},{"id":22632,"sectionId":8406,"title":"Definition","data":"The average time associated with selecting carriers and rating shipments.
","itemType":1,"order":1},{"id":22633,"sectionId":8407,"title":"Definition","data":"The average time associated with shipping a product.
","itemType":1,"order":1},{"id":22635,"sectionId":8408,"title":"Definition","data":"The average time associated with assessing the performance of delivery processes.
","itemType":1,"order":1},{"id":22637,"sectionId":8409,"title":"Definition","data":"The average time associated with assessing the performance of supplier processes.
","itemType":1,"order":1},{"id":22639,"sectionId":8410,"title":"Definition","data":"Total gross product revenue/Total net assets.
","itemType":1,"order":1},{"id":22641,"sectionId":8411,"title":"Definition","data":"The average time associated with authorizing the return of a defective product.
","itemType":1,"order":1},{"id":22643,"sectionId":8412,"title":"Definition","data":"The average time associated with authorizing the return of excess product.
","itemType":1,"order":1},{"id":22645,"sectionId":8413,"title":"Definition","data":"The average time associated with authorizing the return of MRO product.
","itemType":1,"order":1},{"id":22647,"sectionId":8414,"title":"Definition","data":"Number of days each engineering change impacts the delivery date/Total number of changes.
","itemType":1,"order":1},{"id":22649,"sectionId":8415,"title":"Definition","data":"Number of days each schedule change impacts the delivery date/Total number of changes.
","itemType":1,"order":1},{"id":22651,"sectionId":8416,"title":"Definition","data":"Cycle time for implementing change notices/Total number of changes.
","itemType":1,"order":1},{"id":22653,"sectionId":8417,"title":"Definition","data":"The average time associated with balancing product resources and product requirements.
","itemType":1,"order":1},{"id":22655,"sectionId":8418,"title":"Definition","data":"The average time associated with the identifying, prioritizing and aggregating production requirements.
","itemType":1,"order":1},{"id":22657,"sectionId":8419,"title":"Definition","data":"The average time associated with balancing return resources and return requirements.
","itemType":1,"order":1},{"id":22659,"sectionId":8420,"title":"Definition","data":"The average time associated with balancing supply chain resources and supply chain requirements.
","itemType":1,"order":1},{"id":22661,"sectionId":8421,"title":"Definition","data":"The current return order cycle time, including customer return order processing cycle time, transit time, return processing and disposition cycle time, and the time required for other related processes.
","itemType":1,"order":1},{"id":22663,"sectionId":8422,"title":"Definition","data":"The current logistics order cycle time, including customer order processing cycle time, dock-to-stock cycle time, pick-to-ship cycle, transit time, and the time required for other related processes.
","itemType":1,"order":1},{"id":22665,"sectionId":8423,"title":"Definition","data":"The current manufacturing cycle time for a given customer’s order.
","itemType":1,"order":1},{"id":22667,"sectionId":8424,"title":"Definition","data":"The current supplier return order cycle time, including supplier return order processing cycle time, pick-to-ship cycle time, transit time and the time required for other related processes.
","itemType":1,"order":1},{"id":22669,"sectionId":8425,"title":"Definition","data":"The average time required to fulfill and install a product.
","itemType":1,"order":1},{"id":22670,"sectionId":8426,"title":"Definition","data":"The average time associated with entering an order, committing resources, and launching the program.
","itemType":1,"order":1},{"id":22672,"sectionId":8427,"title":"Definition","data":"The average time associated with establishing and communicating Return plans.
","itemType":1,"order":1},{"id":22674,"sectionId":8428,"title":"Definition","data":"The average time associated with establishing and communicating delivery plans.
","itemType":1,"order":1},{"id":22676,"sectionId":8429,"title":"Definition","data":"The average time associated with establishing and communicating production plans.
","itemType":1,"order":1},{"id":22678,"sectionId":8430,"title":"Definition","data":"The average time associated with establishing and communicating sourcing plans.
","itemType":1,"order":1},{"id":22680,"sectionId":8431,"title":"Definition","data":"The average time associated with completing the supply chain planning process and communicating the plans.
","itemType":1,"order":1},{"id":22682,"sectionId":8432,"title":"Definition","data":"The average time associated with identifying, prioritizing, and aggregating production requirements.
","itemType":1,"order":1},{"id":22684,"sectionId":8433,"title":"Definition","data":"The average time associated with identifying, assessing, and aggregating delivery resource availability.
","itemType":1,"order":1},{"id":22686,"sectionId":8434,"title":"Definition","data":"The average time associated with identifying, assessing, and aggregating product resource availability.
","itemType":1,"order":1},{"id":22688,"sectionId":8435,"title":"Definition","data":"The average time associated with identifying, assessing, and aggregating supply chain resource availability.
","itemType":1,"order":1},{"id":22690,"sectionId":8436,"title":"Definition","data":"The average time associated with the identifying, assessing, and aggregating delivery requirements.
","itemType":1,"order":1},{"id":22692,"sectionId":8437,"title":"Definition","data":"The average time associated with the identifying, assessing, and aggregating product requirements.
","itemType":1,"order":1},{"id":22694,"sectionId":8438,"title":"Definition","data":"The average time associated with identifying, assessing, and aggregating production requirements.
","itemType":1,"order":1},{"id":22696,"sectionId":8439,"title":"Definition","data":"The average time associated with identifying, assessing, and aggregating return requirements.
","itemType":1,"order":1},{"id":22698,"sectionId":8440,"title":"Definition","data":"The average time associated with identifying, prioritizing, and aggregating supply chain requirements.
","itemType":1,"order":1},{"id":22700,"sectionId":8441,"title":"Definition","data":"The percentage of materials, components or finished goods that are there when needed
","itemType":1,"order":1},{"id":22701,"sectionId":8442,"title":"Definition","data":"The average time associated with the generation and issuance of an invoice.
","itemType":1,"order":1},{"id":22703,"sectionId":8443,"title":"Definition","data":"The average time associated with the issuance of material to production.
","itemType":1,"order":1},{"id":22705,"sectionId":8444,"title":"Definition","data":"The average time associated with maintaining source data.
","itemType":1,"order":1},{"id":22707,"sectionId":8445,"title":"Definition","data":"The average time associated with managing Plan business rules.
","itemType":1,"order":1},{"id":22709,"sectionId":8446,"title":"Definition","data":"The average time associated with managing rules for returns
","itemType":1,"order":1},{"id":22711,"sectionId":8447,"title":"Definition","data":"The average time associated with managing capital assets.
","itemType":1,"order":1},{"id":22712,"sectionId":8448,"title":"Definition","data":"The average time associated with managing Fulfill business rules.
","itemType":1,"order":1},{"id":22714,"sectionId":8449,"title":"Definition","data":"The average time associated with managing Fulfill capital assets.
","itemType":1,"order":1},{"id":22715,"sectionId":8450,"title":"Definition","data":"The average time associated with managing import and export requirements.
","itemType":1,"order":1},{"id":22717,"sectionId":8451,"title":"Definition","data":"The average time associated with managing integrated supply chain capital assets.
","itemType":1,"order":1},{"id":22719,"sectionId":8452,"title":"Definition","data":"The average time associated with managing integrated supply chain capital assets.
","itemType":1,"order":1},{"id":22721,"sectionId":8453,"title":"Definition","data":"The average time associated with managing integrated supply chain inventory.
","itemType":1,"order":1},{"id":22723,"sectionId":8454,"title":"Definition","data":"The average time associated with managing integrated supply chain transportation.
","itemType":1,"order":1},{"id":22725,"sectionId":8455,"title":"Definition","data":"The average time associated with managing production information.
","itemType":1,"order":1},{"id":22727,"sectionId":8456,"title":"Definition","data":"The average time associated with managing production information.
","itemType":1,"order":1},{"id":22729,"sectionId":8457,"title":"Definition","data":"The average time associated with managing the performance of Return activities.
","itemType":1,"order":1},{"id":22731,"sectionId":8458,"title":"Definition","data":"The average time associated with managing the performance of Return activities.
","itemType":1,"order":1},{"id":22733,"sectionId":8459,"title":"Definition","data":"The average time associated with collecting Plan data.
","itemType":1,"order":1},{"id":22735,"sectionId":8460,"title":"Definition","data":"The average time associated with managing the planning of the supply chain configuration.
","itemType":1,"order":1},{"id":22737,"sectionId":8461,"title":"Definition","data":"The average time associated with managing the production network.
","itemType":1,"order":1},{"id":22739,"sectionId":8462,"title":"Definition","data":"The average time associated with managing production performance.
","itemType":1,"order":1},{"id":22741,"sectionId":8463,"title":"Definition","data":"The average time associated with managing production rules.
","itemType":1,"order":1},{"id":22743,"sectionId":8464,"title":"Definition","data":"The average time associated with managing Return capital assets.
","itemType":1,"order":1},{"id":22744,"sectionId":8465,"title":"Definition","data":"The average time associated with managing Return data collection.
","itemType":1,"order":1},{"id":22746,"sectionId":8466,"title":"Definition","data":"The average time associated with managing the Return network configuration.
","itemType":1,"order":1},{"id":22748,"sectionId":8467,"title":"Definition","data":"The average time associated with managing Return transportation.
","itemType":1,"order":1},{"id":22750,"sectionId":8468,"title":"Definition","data":"The average time associated with managing Source business rules.
","itemType":1,"order":1},{"id":22752,"sectionId":8469,"title":"Definition","data":"The average time associated with managing supplier agreements.
","itemType":1,"order":1},{"id":22754,"sectionId":8470,"title":"Definition","data":"The average time associated with managing the supplier network.
","itemType":1,"order":1},{"id":22756,"sectionId":8471,"title":"Definition","data":"The average time associated with managing work-in-process transportation.
","itemType":1,"order":1},{"id":22758,"sectionId":8472,"title":"Definition","data":"The average time associated with managing transportation.
","itemType":1,"order":1},{"id":22760,"sectionId":8473,"title":"Definition","data":"The average time associated with negotiating and receiving a contract.
","itemType":1,"order":1},{"id":22762,"sectionId":8474,"title":"Definition","data":"The average time associated with obtaining and responding to requests for quote and requests for proposal.
","itemType":1,"order":1},{"id":22764,"sectionId":8475,"title":"Definition","data":"Any lead time caused by customer requirements during the order fulfillment process when no activity takes place. Note that this dwell time is different from idle time or non-value-added lead time, which are caused by inefficiencies in the organization’s processes and therefore ultimately under responsibility of the organization. These latter kinds of idle time should not be deducted from Order Fulfillment Cycle Time.
","itemType":1,"order":1},{"id":22766,"sectionId":8476,"title":"Definition","data":"The average time associated with Plan processes.
","itemType":1,"order":1},{"id":22768,"sectionId":8477,"title":"Definition","data":"The average time associated with planning Source activities.
","itemType":1,"order":1},{"id":22770,"sectionId":8478,"title":"Definition","data":"The average time associated with processing inquiries and quotes.
","itemType":1,"order":1},{"id":22772,"sectionId":8479,"title":"Definition","data":"The average time associated with receiving and verifying an order at the customer site.
","itemType":1,"order":1},{"id":22774,"sectionId":8480,"title":"Definition","data":"The average time associated with receiving defective product returns from customers.
","itemType":1,"order":1},{"id":22776,"sectionId":8481,"title":"Definition","data":"The average time associated with receiving excess product returns from customers.
","itemType":1,"order":1},{"id":22778,"sectionId":8482,"title":"Definition","data":"The average time associated with receiving MRO product returns from customers.
","itemType":1,"order":1},{"id":22780,"sectionId":8483,"title":"Definition","data":"The average time associated with receiving product from Transform or Source.
","itemType":1,"order":1},{"id":22782,"sectionId":8484,"title":"Definition","data":"The average time associated with receiving and verifying an order at the customer site.
","itemType":1,"order":1},{"id":22784,"sectionId":8485,"title":"Definition","data":"The total elapsed time from the moment the product is received to the time it is passed to the next process.
","itemType":1,"order":1},{"id":22786,"sectionId":8486,"title":"Definition","data":"The average time associated with reserving inventory and determining a delivery date.
","itemType":1,"order":1},{"id":22788,"sectionId":8487,"title":"Definition","data":"The average time associated with scheduling the receipt of the return of a defective product.
","itemType":1,"order":1},{"id":22790,"sectionId":8488,"title":"Definition","data":"The average time associated with scheduling the receipt of the return of excess product.
","itemType":1,"order":1},{"id":22791,"sectionId":8489,"title":"Definition","data":"The average time associated with scheduling the receipt of the return of an MRO product.
","itemType":1,"order":1},{"id":22793,"sectionId":8490,"title":"Definition","data":"The average time associated with sourcing Return.
","itemType":1,"order":1},{"id":22795,"sectionId":8491,"title":"Definition","data":"The average amount of time associated with transferring a product from the last known holder or designated return center to the appropriate process for implementing the disposition decision.
","itemType":1,"order":1},{"id":22797,"sectionId":8492,"title":"Definition","data":"The average time associated with transferring excess product from a designated return center to the appropriate process for implementing the disposition decision.
","itemType":1,"order":1},{"id":22799,"sectionId":8493,"title":"Definition","data":"The average time associated with transferring an MRO product from a service provider to the appropriate process for implementing the disposition decision.
","itemType":1,"order":1},{"id":22801,"sectionId":8494,"title":"Definition","data":"The time required to collect and properly store production waste.
","itemType":1,"order":1},{"id":22803,"sectionId":8495,"title":"Definition","data":"The average time associated with diagnosis/disposition processes to correctly identify the condition.
","itemType":1,"order":1},{"id":22805,"sectionId":8496,"title":"Definition","data":"Mean Time to Repair (MTTR) measures the average time needed to restore an asset to its fully operational capabilities
","itemType":1,"order":1},{"id":22807,"sectionId":8497,"title":"Definition","data":"The organization’s ability to quickly adapt its strategic and operational supply chain response to demand and/or supply shocks. Strategic Supply Chain Agility is the number of days needed to meet a 25% unplanned change demand. Operational Supply Chain Agility is the sustained percentage increase or decrease in quantities that can be achieved in operational planning horizon (commonly 30 to 60 days).
","itemType":1,"order":1},{"id":22814,"sectionId":8498,"title":"Definition","data":"The organization’s ability to quickly adapt its strategic and operational order response to demand and/or supply shocks. Strategic Order Agility is the number of days needed to meet a 25% unplanned change in orders. Operational Order Agility is the sustained percentage increase or decrease in order quantities that can be achieved in operational planning horizon (commonly 30 to 60 days).
","itemType":1,"order":1},{"id":22819,"sectionId":8499,"title":"Definition","data":"The organization’s ability to quickly adapt its strategic and operational source response to demand and/or supply shocks. Strategic Source Agility is the number of days needed to meet a 25% change in demand. Operational Source Agility is the sustained percentage increase or decrease in purchase order quantities that can be achieved in operational planning horizon (commonly 30 to 60 days).
","itemType":1,"order":1},{"id":22824,"sectionId":8500,"title":"Definition","data":"The organization’s ability to quickly adapt its strategic and operational transform response to demand and/or supply shocks. Strategic Transform Agility is the number of days needed to meet a 25% unplanned change in demand. Operational Transform Agility is the sustained percentage increase in manufacturing and/or service orders that can be achieved in operational planning horizon (commonly 30 to 60 days).
","itemType":1,"order":1},{"id":22829,"sectionId":8501,"title":"Definition","data":"The organization’s ability to quickly adapt its strategic and operational fulfill response to demand and/or supply shocks. Strategic Fulfill Agility is the number of days needed to meet a 25% unplanned change in demand. Operational Fulfill Agility is the sustained percentage increase or decrease in shipment quantities that can be achieved in operational planning horizon (commonly 30 to 60 days).
","itemType":1,"order":1},{"id":22834,"sectionId":8502,"title":"Definition","data":"The organization’s ability to quickly adapt its strategic and operational return response to return requirement shocks. Strategic Return Agility is the number of days needed to meet a 25% unplanned change in returns. Operational Return Agility is the sustained percentage increase or decrease in return quantities that can be achieved in operational planning horizon (commonly 30 to 60 days).
","itemType":1,"order":1},{"id":22839,"sectionId":8504,"title":"Definition","data":"Risk management in organizations traditionally resides within the finance function because of the subject’s inherent focus on financial impacts on the organization. However, many organizations do not assess supply chain risk separately. In recent years, supply chain risk management (SCRM) has become the focus area for finance executives responsible for enterprise risk management. Therefore, there is a need to establish a common language to quantify supply chain risk in terms of currency. Value at Risk (VaR) is a popular risk metric widely used by the finance industry to understand the risk exposure of a trading portfolio based on historic volatility.
Simple VaR calculation: VaR = Probability of risk event x Monetary impact of risk event
Advanced VaR calculation: More accurate measures of VaR can be attained by applying more complex calculations, distributions and confidence intervals that use distributions and confidence intervals.
Because VaR is an estimate, traditional estimating techniques of describing accuracy can be used, such as + or – 5%.
The use of VaR allows organizations to look at all potential supply chain risks through one metric and helps prioritize mitigation efforts. All the risk events across supply chain functions Orchestrate, Plan, Order, Source, Transform, Fulfill, and Return can be rolled up to an overall VaR for the entire supply chain, creating a financial lever to help integrate SCRM into the organization’s overall risk management initiative. The calculation is:
Supply Chain Risk VaR ($) = VaR $ (Orchestrate) + VaR $ (Plan) + VaR $ (Order)+ VaR $ (Source) + VaR $ (Transform) + VaR $ (Fulfill) + VaR $ (Return)
","itemType":1,"order":1},{"id":22843,"sectionId":8505,"title":"Definition","data":"Percentage of labor used in logistics but not used in direct activity.
","itemType":1,"order":1},{"id":22845,"sectionId":8506,"title":"Definition","data":"Percentage of labor used in manufacturing but not used in direct activity.
","itemType":1,"order":1},{"id":22847,"sectionId":8507,"title":"Definition","data":"Additional customer return volume.
","itemType":1,"order":1},{"id":22849,"sectionId":8508,"title":"Definition","data":"Additional delivery volume.
","itemType":1,"order":1},{"id":22851,"sectionId":8509,"title":"Definition","data":"Additional source volumes to be determined given ramped-up resources.
","itemType":1,"order":1},{"id":22853,"sectionId":8510,"title":"Definition","data":"Current total number of items returned.
","itemType":1,"order":1},{"id":22855,"sectionId":8511,"title":"Definition","data":"Number of orders shipped.
","itemType":1,"order":1},{"id":22857,"sectionId":8512,"title":"Definition","data":"Amount of each item manufactured.
","itemType":1,"order":1},{"id":22859,"sectionId":8513,"title":"Definition","data":"Sum of time to place a purchase order and supplier lead time.
","itemType":1,"order":1},{"id":22861,"sectionId":8514,"title":"Definition","data":"Current return volume in terms of number of orders returned.
","itemType":1,"order":1},{"id":22863,"sectionId":8515,"title":"Definition","data":"Amount of each item purchased.
","itemType":1,"order":1},{"id":22865,"sectionId":8516,"title":"Definition","data":"Customer return order cycle time, including customer return order processing cycle time, transit time, return processing and disposition cycle time, reestablished and sustained for increased quantities returned from customer given 30 days.
","itemType":1,"order":1},{"id":22867,"sectionId":8517,"title":"Definition","data":"Percentage of orders with on-time and accurate documentation supporting the order, including packing slips, bills of lading and invoices.
(Total number of orders delivered with correct and timely documentation / Total number of orders delivered) x 100%.
","itemType":1,"order":1},{"id":22869,"sectionId":8518,"title":"Definition","data":"Total cost to manage order processing, acquire materials, manage inventory, and manage supply-chain finance, planning, and IT costs, as represented as a percent of revenue. Accurate assignment of IT-related cost is challenging. It can be done using Activity-Based-Costing methods or based on more traditional approaches. Allocation based on user counts, transaction counts, or departmental headcounts are reasonable approaches. The emphasis should be on capturing all costs, whether incurred in the entity completing the survey or incurred in a supporting organization on behalf of the entity. Reasonable estimates founded in data were accepted as a means to assess overall performance. All estimates reflected fully burdened actuals inclusive of salary, benefits, space and facilities, and general and administrative allocations.
","itemType":1,"order":1},{"id":22877,"sectionId":8519,"title":"Definition","data":"All costs associated with managing orders, including New Product Release Phase-In and Maintenance; Create Customer Order; Order Entry and Maintenance; Contract/Program and Channel Management; Installation Planning; Order Fulfillment; Distribution; Transportation, Outbound Freight and Duties; Installation; and Customer Invoicing/Accounting.
","itemType":1,"order":1},{"id":22881,"sectionId":8520,"title":"Definition","data":"All costs associated with acquiring material, including Materials (Commodity) Management and Planning, Supplier Quality Engineering, Inbound Freight and Duties, Receiving and Material Storage, Incoming Inspection, Material Process and Component Engineering, and Tooling
","itemType":1,"order":1},{"id":22884,"sectionId":8521,"title":"Definition","data":"All costs associated with carrying inventory, including Opportunity; Shrinkage; Insurance and Taxes; Total Obsolescence for Raw Material, WIP, and Finished Goods Inventory; Channel Obsolescence; and Field Service Parts Obsolescence.
","itemType":1,"order":1},{"id":22887,"sectionId":8522,"title":"Definition","data":"All costs associated with supply chain finance and planning, including Supply-Chain Finance Costs and Demand/Supply Planning Costs.
","itemType":1,"order":1},{"id":22890,"sectionId":8523,"title":"Definition","data":"Information Technology (IT) costs (in US dollars) associated with major supply-chain management processes as described below. These costs should include: Development costs (costs incurred in process reengineering, planning, software development, installation, implementation, and training associated with new and/or upgraded architecture, infrastructure, and systems to support the described supply-chain management processes), Execution costs (operating costs to support supply-chain process users, including computer and network operations, EDI and telecommunications services, and amortization/depreciation of hardware, Maintenance costs (costs incurred in problem resolution, troubleshooting, repair, and routine maintenance associated with installed hardware and software for described supply-chain management processes. Include costs associated with database administration, systems configuration control, release planning and management.
","itemType":1,"order":1},{"id":22892,"sectionId":8524,"title":"Definition","data":"The cost associated with buying raw materials and producing finished goods. This cost includes direct costs, such as labor and materials, and indirect costs, such as overhead.
Note: The cost of raw materials and production costs generally are accounted for in COGS. It is recognized that there likely is an overlap between supply chain management costs and COGS.
","itemType":1,"order":1},{"id":22899,"sectionId":8525,"title":"Definition","data":"Direct cost spent on material for production.
","itemType":1,"order":1},{"id":22903,"sectionId":8526,"title":"Definition","data":"Direct cost spent on labor for production.
","itemType":1,"order":1},{"id":22906,"sectionId":8527,"title":"Definition","data":"Indirect cost incurred by or spent on production.
","itemType":1,"order":1},{"id":22909,"sectionId":8529,"title":"Definition","data":"Costs associated with releasing new products to the field, maintaining released products, assigning product ID, defining configurations and packaging, publishing availability schedules, release letters and updates, and maintaining product databases.
","itemType":1,"order":1},{"id":22910,"sectionId":8530,"title":"Definition","data":"Costs associated with creating and pricing configurations to order and preparing customer order documents.
","itemType":1,"order":1},{"id":22911,"sectionId":8531,"title":"Definition","data":"Costs associated with maintaining the customer database, credit check, accepting new orders, and adding them to the order system as well as later order modifications.
","itemType":1,"order":1},{"id":22912,"sectionId":8532,"title":"Definition","data":"Costs related to contract negotiation, monitoring progress, and reporting against the customer's contract, including administration of performance or warranty related issues.
","itemType":1,"order":1},{"id":22913,"sectionId":8533,"title":"Definition","data":"Costs associated with installation engineering, scheduling and modification, handling cancellations, and planning the installation.
","itemType":1,"order":1},{"id":22914,"sectionId":8534,"title":"Definition","data":"Costs associated with order processing, inventory allocation, ordering from internal or external suppliers, shipment scheduling, order status reporting, and shipment initiation.
","itemType":1,"order":1},{"id":22915,"sectionId":8535,"title":"Definition","data":"Costs associated with warehouse space and management, finished goods receiving and stocking, processing shipments, picking, and consolidating, selecting carrier, and staging products/systems.
","itemType":1,"order":1},{"id":22916,"sectionId":8536,"title":"Definition","data":"Costs associated with all company paid freight duties from point-of-manufacture to end-customer or channel.
","itemType":1,"order":1},{"id":22917,"sectionId":8537,"title":"Definition","data":"Costs associated with verification of site preparation, installation, certification, and authorization of billing.
","itemType":1,"order":1},{"id":22918,"sectionId":8538,"title":"Definition","data":"Costs associated with creating invoice documents and processing (i.e., recording and capturing) customer payments.
","itemType":1,"order":1},{"id":22919,"sectionId":8539,"title":"Definition","data":"All costs associated with supplier sourcing, contract negotiation and qualification, and the preparation, placement, and tracking of a purchase order. We recognize that these functions may be organizationally dispersed and/or decentralized but ask you to group all related costs for the purposes of this study. Also, this category includes all costs related to buyer/planners.
","itemType":1,"order":1},{"id":22920,"sectionId":8540,"title":"Definition","data":"The costs associated with the determination, development/certification, and monitoring of suppliers' capabilities to fully satisfy the applicable quality and regulatory requirements.
","itemType":1,"order":1},{"id":22921,"sectionId":8541,"title":"Definition","data":"Freight costs associated with the movement of material from a vendor to the buyer and the associated administrative tasks. Duties are those fees and taxes levied by government for moving purchased material across international borders. Customs brokers fees should also be considered in this category.
","itemType":1,"order":1},{"id":22923,"sectionId":8542,"title":"Definition","data":"All costs associated with taking possession of material. This does not include inspection. Note that inventory-carrying costs are covered in a subsequent worksheet.
","itemType":1,"order":1},{"id":22925,"sectionId":8543,"title":"Definition","data":"All costs associated with the inspection and testing of received materials to verify compliance with specifications.
","itemType":1,"order":1},{"id":22927,"sectionId":8544,"title":"Definition","data":"Those tasks required to document and communicate component specifications, as well as reviews to improve the manufacturability of the purchased item.
","itemType":1,"order":1},{"id":22928,"sectionId":8545,"title":"Definition","data":"Those costs associated with the design, development, and depreciation of the tooling required to produce a purchased item. A tooling cost would be incurred by a company if they actually paid for equipment and/or maintenance for a contract manufacturer that makes their product. Sometimes, there aren't enough incentive for a contract manufacturer to upgrade plant equipment to a level of quality that a company requires, so the company will pay for the upgrades and maintenance to ensure high quality. May not be common in some industries such as the Chemicals.
","itemType":1,"order":1},{"id":22929,"sectionId":8546,"title":"Definition","data":"The opportunity cost of holding inventory. This should be based on your company's own cost of capital standards using the following formula. Calculation: Cost of Capital x Average Net Value of Inventory
","itemType":1,"order":1},{"id":22930,"sectionId":8547,"title":"Definition","data":"The costs associated with breakage, pilferage, and deterioration of inventories. Usually pertains to the loss of material through handling damage, theft, or neglect.
","itemType":1,"order":1},{"id":22931,"sectionId":8548,"title":"Definition","data":"The cost of insuring inventories and taxes associated with the holding of inventory.
","itemType":1,"order":1},{"id":22932,"sectionId":8549,"title":"Definition","data":"Inventory reserves taken due to obsolescence and scrap and includes products exceeding the shelf life, i.e., spoils and is no good for use in its original purpose (do not include reserves taken for Field Service Parts).
","itemType":1,"order":1},{"id":22933,"sectionId":8550,"title":"Definition","data":"Aging allowances paid to channel partners, provisions for buy-back agreements, etc. Includes all material that becomes obsolete while in a distribution channel. Usually, a distributor will demand a refund on material that goes bad (shelf life) or is no longer needed because of changing needs.
","itemType":1,"order":1},{"id":22934,"sectionId":8551,"title":"Definition","data":"Reserves taken due to obsolescence and scrap. Field Service Parts are those inventories kept at locations outside the four walls of the manufacturing plant i.e., distribution center or warehouse. (This may be NA for some industries, e.g.: Chemicals)
","itemType":1,"order":1},{"id":22935,"sectionId":8552,"title":"Definition","data":"Costs associated with paying invoices, auditing physical counts, performing inventory accounting, and collecting accounts receivable. Does NOT include customer invoicing/ accounting costs (see Order Management Costs).
","itemType":1,"order":1},{"id":22936,"sectionId":8553,"title":"Definition","data":"Costs associated with forecasting, developing finished goods, intermediate, subassembly or end item inventory plans, and coordinating Demand/Supply
","itemType":1,"order":1},{"id":22937,"sectionId":8554,"title":"Definition","data":"The percentage of Tariffs paid in the supply chain represented as a percentage of the company’s COGS.
","itemType":1,"order":1},{"id":22939,"sectionId":8555,"title":"Definition","data":"A measure of a company's earning power from ongoing operations, equal to earnings (revenues minus cost of sales, operating expenses, and taxes) before deduction of interest payments and income taxes, also called operating profit. EBIT = Revenue - COGS - Operating Expenses
","itemType":1,"order":1},{"id":22943,"sectionId":8556,"title":"Definition","data":"The effective tax rate is the average tax rate paid by a corporation or an individual. Tax-efficient supply chains can significantly impact this rate.
","itemType":1,"order":1},{"id":22946,"sectionId":8557,"title":"Definition","data":"The time it takes for an investment made in raw materials to flow back into a company. For services, this represents the time from the point when a company pays for the resources consumed in the performance of a service to the time that the company receives payment from the customer for that service.
","itemType":1,"order":1},{"id":22953,"sectionId":8558,"title":"Definition","data":"The length of time from when a sale is made until the payment for the sale is received from the customers. The amount of sales outstanding expressed in days.
","itemType":1,"order":1},{"id":22957,"sectionId":8559,"title":"Definition","data":"The amount of inventory or stock expressed in days of sales. This metric also is known as days cost of sales in inventory and days sales in inventory, and it is the inverse of inventory turns.
","itemType":1,"order":1},{"id":22962,"sectionId":8560,"title":"Definition","data":"The length of time in days from purchasing materials, labor or conversion resources until cash payments must be made. This metric also is known as average payment period for materials, days purchases in accounts payable and days outstanding in accounts payable.
","itemType":1,"order":1},{"id":22966,"sectionId":8561,"title":"Definition","data":"A measurement of the return an organization receives from its invested capital in supply chain fixed assets, including fixed assets used in Orchestrate, Plan, Order Source, Transfer, Fulfill and Return.
","itemType":1,"order":1},{"id":22973,"sectionId":8562,"title":"Definition","data":"Operating revenue generated from a supply chain. This does not include non-operating revenue, such as leased real estate, investments, court settlements or sales of office buildings.
","itemType":1,"order":1},{"id":22976,"sectionId":8563,"title":"Definition","data":"The sum of the fixed assets costs associated with Orchestrate, Plan, Order, Source, Transform, Fulfill, and Return fixed assets.
","itemType":1,"order":1},{"id":22979,"sectionId":8564,"title":"Definition","data":"A measurement that assesses the magnitude of investment relative to a company's working capital position versus the revenue generated from a supply chain. Components include accounts receivable, accounts payable, inventory, (Supply Chain) Revenue (AM.2.4), Total Supply Chain Management Cost (CO.1.1) and supply chain management costs.
","itemType":1,"order":1},{"id":22986,"sectionId":8565,"title":"Definition","data":"The amount of purchased materials, labor and conversion resources that need to be paid for. Also known as payables outstanding.
","itemType":1,"order":1},{"id":22990,"sectionId":8566,"title":"Definition","data":"The monetary value of accounts receivable outstanding expressed in dollars. Also known as sales outstanding.
","itemType":1,"order":1},{"id":22994,"sectionId":8567,"title":"Definition","data":"The monetary value of inventory or stock.
","itemType":1,"order":1},{"id":22998,"sectionId":8569,"title":"Definition","data":"Value of raw materials / (Cost of Goods Sold (COGS) (CO.1.2) / 365 days).
","itemType":1,"order":1},{"id":23000,"sectionId":8570,"title":"Definition","data":"Total value of work in process / (Cost of Goods Sold (COGS) (CO.1.2) / 365 days).
","itemType":1,"order":1},{"id":23002,"sectionId":8571,"title":"Definition","data":"The value of defective product inventory as a percentage of the value of total inventory.
Calculation: Total defective product inventory value / Total inventory value x 100%.
","itemType":1,"order":1},{"id":23004,"sectionId":8572,"title":"Definition","data":"The value of excess inventory as a percentage of the total inventory value.
Calculation: Value of excess inventory / Total inventory value x 100%.
","itemType":1,"order":1},{"id":23006,"sectionId":8573,"title":"Definition","data":"Gross finished goods inventory / (Value of transfers / 365 days).
Note: Value of transfers is the amount transferred, in a fiscal year, from one stage of the manufacturing process to another, such as the amount of raw materials that are transformed into work in process.
","itemType":1,"order":1},{"id":23008,"sectionId":8574,"title":"Definition","data":"Percentage of the product content, including packaging, that has a supplier take-back or recycling program. For example, some suppliers ship products in reusable containers or totes that can be returned, cleaned, and refilled.
","itemType":1,"order":1},{"id":23010,"sectionId":8575,"title":"Definition","data":"Percentage of the product content that is recyclable or reusable.
","itemType":1,"order":1},{"id":23012,"sectionId":8576,"title":"Definition","data":"The percentage of scrap from packaging that is immediately reused in the packaging process.
","itemType":1,"order":1},{"id":23014,"sectionId":8577,"title":"Definition","data":"The percentage of scrap from production that is immediately reused in the production process.
","itemType":1,"order":1},{"id":23016,"sectionId":8578,"title":"Definition","data":"The weight of recycled material in the product as a percentage of the total product weight.
","itemType":1,"order":1},{"id":23018,"sectionId":8579,"title":"Definition","data":"Average age of excess inventory in days.
","itemType":1,"order":1},{"id":23020,"sectionId":8580,"title":"Definition","data":"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 and materials availability.
","itemType":1,"order":1},{"id":23022,"sectionId":8581,"title":"Definition","data":"The average time associated with returns.
","itemType":1,"order":1},{"id":23024,"sectionId":8582,"title":"Definition","data":"The percentage by weight of material issued for production that is classified as hazardous material.
","itemType":1,"order":1},{"id":23026,"sectionId":8583,"title":"Definition","data":"The percentage by weight of waste generated from production that is classified as hazardous material.
","itemType":1,"order":1},{"id":23028,"sectionId":8584,"title":"Definition","data":"The percentage by weight of the total raw material that is classified as packaging material.
","itemType":1,"order":1},{"id":23030,"sectionId":8585,"title":"Definition","data":"The number of returned products that are rebuilt or recycled as a percentage of the total number of products returned.
","itemType":1,"order":1},{"id":23032,"sectionId":8586,"title":"Definition","data":"The percentage by weight of waste generated by production that is recyclable.
","itemType":1,"order":1},{"id":23034,"sectionId":8587,"title":"Definition","data":"The number of returns that are for recycling or reuse as a percentage of the total number of products returned.
","itemType":1,"order":1},{"id":23036,"sectionId":8588,"title":"Definition","data":"The weight of products returned divided by the weight of products shipped.
","itemType":1,"order":1},{"id":23039,"sectionId":8589,"title":"Definition","data":"The value of defective products awaiting a disposition decision as a percentage of the value of the total defective product inventory.
Calculation: Value of defective inventory in disposition stage / Total defective product inventory value x 100%.
","itemType":1,"order":1},{"id":23041,"sectionId":8590,"title":"Definition","data":"The value of defective products awaiting return authorization as a percentage of the total defective product inventory value.
Calculation: Value of defective product inventory in request return authorization stage / Total defective product inventory value x 100%.
","itemType":1,"order":1},{"id":23043,"sectionId":8591,"title":"Definition","data":"The value of defective product inventory in transportation as a percentage of the total defective product inventory.
Calculation: Value of defective product inventory in the physical return and transportation stage / Total defective product inventory value x 100%.
","itemType":1,"order":1},{"id":23045,"sectionId":8592,"title":"Definition","data":"The value of defective product inventory awaiting scheduling as a percentage of the total defective product inventory value.
Calculation: Value of defective product in scheduling stage / Total defective product inventory value x 100%
","itemType":1,"order":1},{"id":23047,"sectionId":8593,"title":"Definition","data":"The value of excess inventory awaiting return in the disposition decision stage as a percentage of the total excess inventory value.
Calculation: Excess inventory in disposition stage / Total excess inventory value x 100%.
","itemType":1,"order":1},{"id":23049,"sectionId":8594,"title":"Definition","data":"The value of excess product in the physical return and transportation stage as a percentage of the total excess product inventory value.
Calculation: Value of excess product in physical return and transportation stage / Total excess inventory value x 100%.
","itemType":1,"order":1},{"id":23051,"sectionId":8595,"title":"Definition","data":"The value of excess inventory awaiting return authorization as a percentage of the total excess product inventory value.
Calculation: Value of excess product in request return authorization stage / Value of total excess inventory x 100%.
","itemType":1,"order":1},{"id":23053,"sectionId":8596,"title":"Definition","data":"The value of excess inventory awaiting return in the identification stage as a percentage of the total excess inventory value
Calculation: Value of excess inventory in identification stage / Total inventory value x 100%.
","itemType":1,"order":1},{"id":23055,"sectionId":8597,"title":"Definition","data":"The value of excess inventory awaiting scheduling as a percentage of the total excess inventory value. Calculation: Value of excess inventory in scheduling stage / Total inventory value x 100%.
","itemType":1,"order":1},{"id":23057,"sectionId":8598,"title":"Definition","data":"The value of unserviceable MRO inventory in the disposition stage as a percentage of total MRO inventory value.
Calculation: Value of unserviceable MRO inventory in the disposition stage / Total MRO inventory value x 100%.
","itemType":1,"order":1},{"id":23059,"sectionId":8599,"title":"Definition","data":"The value of unserviceable MRO inventory in transportation as a percentage of the total MRO inventory value.
Calculation: Value of unserviceable MRO inventory in the transportation stage / Total MRO inventory value x 100%.
","itemType":1,"order":1},{"id":23061,"sectionId":8600,"title":"Definition","data":"The value of unserviceable MRO inventory awaiting return authorization as a percentage of the total MRO inventory value.
Calculation: Value of unserviceable MRO inventory in request return authorization stage / Total MRO inventory value x 100%.
","itemType":1,"order":1},{"id":23063,"sectionId":8601,"title":"Definition","data":"The value of unserviceable MRO inventory awaiting identification as a percentage of the total MRO inventory value.
Calculation: Value of unserviceable MRO inventory in identification stage / Total MRO inventory value x 100%.
","itemType":1,"order":1},{"id":23065,"sectionId":8602,"title":"Definition","data":"The value of unserviceable MRO inventory awaiting scheduling as a percentage of the total MRO inventory value.
Calculation: Value of unserviceable MRO inventory in scheduling stage / Total MRO inventory value x 100%.
","itemType":1,"order":1},{"id":23067,"sectionId":8603,"title":"Definition","data":"Total weight or volume of materials that are used to produce and package the organization’s primary products and service.
","itemType":1,"order":1},{"id":23071,"sectionId":8604,"title":"Definition","data":"Total weight or volume of renewable materials that are used to produce and package the organization’s primary products and services.
","itemType":1,"order":1},{"id":23075,"sectionId":8605,"title":"Definition","data":"Total weight or volume of non-renewable materials that are used to produce and package the organization’s primary products and services.
","itemType":1,"order":1},{"id":23079,"sectionId":8606,"title":"Definition","data":"Total energy consumption within the organization, in joules or multiples.
","itemType":1,"order":1},{"id":23084,"sectionId":8607,"title":"Definition","data":"Total renewable energy consumption within the organization, in joules or multiples.
","itemType":1,"order":1},{"id":23088,"sectionId":8608,"title":"Definition","data":"Total nonrenewable energy consumption within the organization, in joules or multiples.
","itemType":1,"order":1},{"id":23092,"sectionId":8609,"title":"Definition","data":"Total water consumption in megaliters.
","itemType":1,"order":1},{"id":23097,"sectionId":8610,"title":"Definition","data":"Total water withdrawal in megaliters.
","itemType":1,"order":1},{"id":23100,"sectionId":8611,"title":"Definition","data":"Total water discharge in megaliters
","itemType":1,"order":1},{"id":23104,"sectionId":8612,"title":"Definition","data":"Metric tons of equivalent CO2 in Scope 1, 2 and 3, which includes all gases whether CO2, CH4, N2O, HFCs, PFCs, SF6, NF3, or other.
","itemType":1,"order":1},{"id":23109,"sectionId":8613,"title":"Definition","data":"Scope 1 emissions refer to emissions from owned or controlled boilers, furnaces, (air-conditioning) or vehicles and emissions from chemical production in owned or controlled process equipment. Methodologies used to calculate GHG emissions can include direct measurement of energy consumed, mass balance calculations, calculations based on site-specific data, calculations based on published criteria, direct measurement of GHG emissions and estimations. See GRI 305 for more information.
","itemType":1,"order":1},{"id":23112,"sectionId":8614,"title":"Definition","data":"Scope 2 emissions refer to emissions from generated or purchased electricity, steam, heating, and cooling consumed by the company. Scope 2 emissions physically occur at the facility where the electricity, steam, heating, and cooling is generated. Methodologies used to calculate Energy indirect (Scope 2) GHG emissions: location-based value and market-based value. See GRI 305 for more information.
","itemType":1,"order":1},{"id":23115,"sectionId":8615,"title":"Definition","data":"Scope 3 emissions are emissions as a consequence of the activities of the company that occur from sources not owned or controlled by the company.
","itemType":1,"order":1},{"id":23118,"sectionId":8616,"title":"Definition","data":"Total weight of waste generated in metric tons.
","itemType":1,"order":1},{"id":23122,"sectionId":8617,"title":"Definition","data":"Percentage of waste diverted from disposal relative to the total weight of waste generated.
","itemType":1,"order":1},{"id":23127,"sectionId":8618,"title":"Definition","data":"Percentage of waste directed to disposal relative to the total weight of waste generated.
","itemType":1,"order":1},{"id":23132,"sectionId":8620,"title":"Definition","data":"The percent of reclaimed input materials used to manufacture the organization’s primary products and services.
(Products and their packaging materials reclaimed)/ (Products sold) x 100
","itemType":1,"order":1},{"id":23134,"sectionId":8621,"title":"Definition","data":"The percent of recycled input materials used to manufacture the organization’s primary products and services.
(Total recycled input materials used)/ (Total input materials used) x100
","itemType":1,"order":1},{"id":23136,"sectionId":8622,"title":"Definition","data":"Percentage of materials that is virgin materials, not recycled or reused before this use.
","itemType":1,"order":1},{"id":23138,"sectionId":8623,"title":"Definition","data":"Total renewable energy sold, in joules or multiples
","itemType":1,"order":1},{"id":23140,"sectionId":8624,"title":"Definition","data":"Total nonrenewable energy sold, in joules or multiples
","itemType":1,"order":1},{"id":23142,"sectionId":8625,"title":"Definition","data":"The rate of water reuse and recycling is a measure of efficiency and demonstrates success in reducing total water withdrawals and discharges.
Calculation: Water Recycled and Reused = Total recycled and reused water / Total water withdrawal
","itemType":1,"order":1},{"id":23143,"sectionId":8626,"title":"Definition","data":"Percentage of waste diverted from disposal for reuse relative to the total weight of waste generated.
Calculation: (waste diverted from disposal for reuse/total weight of waste generated) *100
","itemType":1,"order":1},{"id":23145,"sectionId":8627,"title":"Definition","data":"Percentage of waste diverted from disposal for recycling relative to the total weight of waste generated.
Calculation: (waste diverted from disposal for recycling/total weight of waste generated) *100
","itemType":1,"order":1},{"id":23147,"sectionId":8628,"title":"Definition","data":"Percentage of waste diverted from disposal for other recovery options relative to the total weight of waste generated.
Calculated: (waste diverted from disposal for recovery/total weight of waste generated) *100
","itemType":1,"order":1},{"id":23149,"sectionId":8629,"title":"Definition","data":"Percentage of waste directed to disposal for incineration relative to the total weight of waste generated
Calculation: [Waste directed to disposal for incineration/total weight of waste generated] x 100
","itemType":1,"order":1},{"id":23151,"sectionId":8630,"title":"Definition","data":"Percentage of waste directed to disposal for landfilling relative to the total weight of waste generated
Calculation: (waste directed to disposal for landfilling /total weight of waste generated) *100
","itemType":1,"order":1},{"id":23153,"sectionId":8631,"title":"Definition","data":"Percentage of waste directed to disposal for other disposal operations relative to the total weight of waste generated
Calculation: (waste directed to disposal for other disposal operations /total weight of waste generated) *100
","itemType":1,"order":1},{"id":23155,"sectionId":8632,"title":"Definition","data":"Percentage of the product content that is recyclable or reusable.
","itemType":1,"order":1},{"id":23157,"sectionId":8633,"title":"Definition","data":"Percentage of materials that is actually recycled or reused.
","itemType":1,"order":1},{"id":23159,"sectionId":8634,"title":"Definition","data":"Percentage of Circularity = Weighted average of Percentage of Circular inflow and Percentage of Circular outflow.
Percentage of Circular inflow = [Renewable materials used, or Recycled input materials used] / Materials used
Percentage of Circular outflow = Recovery potential of materials used * Actual recovery of materials
","itemType":1,"order":1},{"id":23161,"sectionId":8635,"title":"Definition","data":"The energy required per unit of activity, output, or any other organization-specific metric.
","itemType":1,"order":1},{"id":23163,"sectionId":8636,"title":"Definition","data":"The water withdrawal required per unit of activity, output, or any other organization-specific metric.
","itemType":1,"order":1},{"id":23165,"sectionId":8637,"title":"Definition","data":"The amount of GHG emissions per unit of activity, output, or any other organization-specific metric.
","itemType":1,"order":1},{"id":23167,"sectionId":8638,"title":"Definition","data":"Number of successful troubleshooting and returns avoided over total number of customer outreaches.
(NOTE: this is currently used by industry as a main metric)
","itemType":1,"order":1},{"id":23168,"sectionId":8639,"title":"Definition","data":"Conformance to country or union law. Example: responsible disposal laws in the EU
","itemType":1,"order":1},{"id":23170,"sectionId":8640,"title":"Definition","data":"Percentage of end of life units disassembled that had components/subassemblies harvested for reuse
","itemType":1,"order":1},{"id":23172,"sectionId":8641,"title":"Definition","data":"Percentage of resale, liquidation, donation, recycling, scrap
","itemType":1,"order":1},{"id":23174,"sectionId":8642,"title":"Definition","data":"Amount of GHG avoided due to renewal of product/services and associated warehouse/transportation/logistics improvement
","itemType":1,"order":1},{"id":23176,"sectionId":8643,"title":"Definition","data":"integration standardization throughout end-to-end supply chains allows different systems to hook up in a plug and play manner instead of initial development and continual updates based on individual user activities
","itemType":1,"order":1},{"id":23178,"sectionId":8644,"title":"Definition","data":"Cost of Restoration of Future Economic Benefit by product family includes cost to renew, scrap, or salvage per time period. Activity by entity to restore up to 100% of original value of units/offering.
","itemType":1,"order":1},{"id":23180,"sectionId":8645,"title":"Definition","data":"Percentage of individuals within the organization’s governance bodies per gender, age group and other indicators of diversity.
","itemType":1,"order":1},{"id":23184,"sectionId":8646,"title":"Definition","data":"Ratio of the entry level wage by gender at significant locations of operation to the minimum wage.
","itemType":1,"order":1},{"id":23188,"sectionId":8647,"title":"Definition","data":"Number of hours training per year per gender per employee category.
","itemType":1,"order":1},{"id":23191,"sectionId":8649,"title":"Definition","data":"Total number of employees (Full Time Equivalents)
","itemType":1,"order":1},{"id":23193,"sectionId":8650,"title":"Definition","data":"Total number and rate of new employee hires during the reporting period, by age group, gender, and region.
","itemType":1,"order":1},{"id":23195,"sectionId":8651,"title":"Definition","data":"Total number and rate of employees leaving the organization during the reporting period, by age group, gender, and region.
","itemType":1,"order":1},{"id":23197,"sectionId":8652,"title":"Definition","data":"Total number and percentage of operations assessed for risks related to corruption
","itemType":1,"order":1},{"id":23199,"sectionId":8653,"title":"Definition","data":"Number of employees (Full Time Equivalents) covered by an occupational health and safety management system
","itemType":1,"order":1},{"id":23201,"sectionId":8654,"title":"Definition","data":"Number and rate of work-related injuries per 1.000.000 hours worked
","itemType":1,"order":1},{"id":23203,"sectionId":8655,"title":"Definition","data":"Number and rate of work-related ill health per hours worked
","itemType":1,"order":1},{"id":23205,"sectionId":8656,"title":"Definition","data":"Ratio of the basic salary and remuneration of women to men for each employee category
","itemType":1,"order":1},{"id":23207,"sectionId":8657,"title":"Definition","data":"Total number of employees that took parental leave, by gender
","itemType":1,"order":1},{"id":23209,"sectionId":8658,"title":"Definition","data":"Number of operations and suppliers at significant risk for incidents of child labor and young workers exposed to hazardous or forced work
","itemType":1,"order":1},{"id":23211,"sectionId":8659,"title":"Definition","data":"Percentage of total employees by gender and by employee category receiving regular performance and career development reviews
","itemType":1,"order":1},{"id":23213,"sectionId":8662,"title":"Definition","data":"Knowledge of the process of reconciling invoices with purchase orders and goods received documents to authorize payment of invoices.
","itemType":1,"order":1},{"id":23218,"sectionId":8663,"title":"Definition","data":"Working knowledge of functional and quality assurance testing of a product to ensure it will perform in accordance with its intended contractual agreement for form, fit, and function. Acceptance Testing may be performed at the supplier's facility or at the customer's final delivery location. Successful product Acceptance Testing may be a prerequisite for supplier payment.
","itemType":1,"order":1},{"id":23223,"sectionId":8664,"title":"Definition","data":"Understanding the process of collecting, analyzing, and communicating financial information about a business entity to specified stakeholders.
","itemType":1,"order":1},{"id":23228,"sectionId":8665,"title":"Definition","data":"Knowledge of effective procurement or business-development communication techniques to inform potential suppliers about product or service specifications.
","itemType":1,"order":1},{"id":23232,"sectionId":8666,"title":"Definition","data":"The ability to arrange workers, machines, and equipment so that the product being assembled passes consecutively from operation to operation until completion.
","itemType":1,"order":1},{"id":23237,"sectionId":8667,"title":"Definition","data":"Experience with Asset Management. Asset management in a supply chain includes inventory reduction and in-sourcing versus outsourcing. Example metrics include inventory days of supply and capacity utilization.
","itemType":1,"order":1},{"id":23242,"sectionId":8668,"title":"Definition","data":"Understanding the process of managing and allocating available resources and inventory at various levels based on business rules. This skill also incorporates date management, lead-time management, capacity management, and inventory management skills.
","itemType":1,"order":1},{"id":23247,"sectionId":8669,"title":"Definition","data":"Basic working knowledge of the concept of applying or incorporating onto or into a product an optical machine-readable representation of data to identify and track that product. Bar codes, which are composed of a series of alternating bars and spaces that represent encoded information, typically need to be scanned manually or with an overhead scanner. RFID tags are electronic tags used to store data about items. When a transmitter sends a signal to a passive RFID tag, it responds with the product information. Active RFID tags contain their own power sources and can broadcast product information to receivers.
Both options of representing encoded data ensure fast and accurate readability of product data.
","itemType":1,"order":1},{"id":23252,"sectionId":8670,"title":"Definition","data":"The ability to effectively interpret and communicate general financial accounting practices and principles that help maintain company and regulatory compliance.
","itemType":1,"order":1},{"id":23257,"sectionId":8671,"title":"Definition","data":"The ability to manage transportation operations of all types, including tracking and managing every aspect of vehicle maintenance, fuel costing, routing, mapping, warehousing, communications, electronic data interchange implementations, traveler and cargo handling, carrier selection, and management accounting.
","itemType":1,"order":1},{"id":23262,"sectionId":8672,"title":"Definition","data":"Working knowledge of the process of capturing and comparing one's own business processes and performance metrics with industry peers and best practices from other industries. Typical measures include quality, time, and cost. This process aims to close performance gaps and do things better, faster, and more cheaply.
","itemType":1,"order":1},{"id":23267,"sectionId":8673,"title":"Definition","data":"Working knowledge of the procurement process for soliciting, issuing, and administering open-ended (in terms of time) purchase orders or contracts that combine and group numerous line items of related products onto a single purchase order or contract.
","itemType":1,"order":1},{"id":23272,"sectionId":8674,"title":"Definition","data":"The ability to analyze a product installation schedule against the constraints and requirements to ensure feasibility to complete the installation process effectively and efficiently.
","itemType":1,"order":1},{"id":23277,"sectionId":8675,"title":"Definition","data":"Working knowledge of the computer technologies that integrate computer-aided design and computer-aided manufacturing to achieve automation from design through manufacturing.
","itemType":1,"order":1},{"id":23282,"sectionId":8676,"title":"Definition","data":"The ability to determine and manage the production capacity needed by an organization to meet changing demands for its products.
","itemType":1,"order":1},{"id":23287,"sectionId":8677,"title":"Definition","data":"The ability to select a transportation mode and service provider to meet due dates and cost and service objectives.
","itemType":1,"order":1},{"id":23292,"sectionId":8678,"title":"Definition","data":"Working knowledge of the procurement process and the ability to clearly disseminate specific contractual or technical requirements that have changed to sourced contractors, suppliers, or vendors.
","itemType":1,"order":1},{"id":23297,"sectionId":8679,"title":"Definition","data":"Working knowledge of the procurement process for requesting and receiving bids and quotes from competing contractors, suppliers, or vendors based on product part numbers, scope, specifications, terms and conditions, and, in some cases, the criteria by which the bids will be evaluated.
","itemType":1,"order":1},{"id":23302,"sectionId":8680,"title":"Definition","data":"Working knowledge of consignment agreements, which detail how one party provides goods and services to another party for sale by that other party. The initial party only gets paid when the other party completes the sale of the goods and services.
","itemType":1,"order":1},{"id":23307,"sectionId":8681,"title":"Definition","data":"Experience in solicitation, bid and proposal evaluation, contract award and post-award administration, and closeout. Knowledge for setting up this type of agreement is required throughout the Source functions.
","itemType":1,"order":1},{"id":23312,"sectionId":8682,"title":"Definition","data":"Awareness of relevant regulations, laws, and requirements, whether external or internal, and the ability to devise, implement and document the relevant and necessary controls to maintain compliance and successfully pass auditing requirements.
","itemType":1,"order":1},{"id":23317,"sectionId":8683,"title":"Definition","data":"Basic financial understanding of reviewing and evaluating actual or anticipated cost data for a project or purchase.
","itemType":1,"order":1},{"id":23322,"sectionId":8684,"title":"Definition","data":"Understanding the documented set of basic principles and associated guidelines that direct and limit a company’s decisions and actions in pursuit of its objectives. These principles and guidelines are typically formulated and enforced by the corporate governing body or an assigned committee within an organization.
","itemType":1,"order":1},{"id":23327,"sectionId":8685,"title":"Definition","data":"The ability to complete the activities required to assess and rate a customer's credit risk by judging its ability to meet financial obligations, identify and block non-creditworthy customers, manage outstanding balances, process credits, and investigate and pursue overdue payments.
","itemType":1,"order":1},{"id":23331,"sectionId":8686,"title":"Definition","data":"Basic knowledge of packing products on incoming shipments so they can be easily sorted at intermediate warehouses or for outgoing shipments based on the final destination to minimize the need for product inventory or storage.
","itemType":1,"order":1},{"id":23335,"sectionId":8687,"title":"Definition","data":"Understanding the process or workflow associated with the identification, receipt, acceptance, picking, packing, and delivery of the packed item(s) to a shipping carrier.
","itemType":1,"order":1},{"id":23340,"sectionId":8688,"title":"Definition","data":"The ability to manage a company’s relations and interactions with clients and sales prospects, possibly including the synchronization of business processes, to identify, attract, and manage new and existing customers.
","itemType":1,"order":1},{"id":23345,"sectionId":8689,"title":"Definition","data":"Understanding the actions, tasks, and responsibilities concerned with the decision to repair all mechanical and electrical out-of-order or broken products in line with the internal return rules.
","itemType":1,"order":1},{"id":23350,"sectionId":8690,"title":"Definition","data":"The ability to convey customer or supplier information by speech or writing.
","itemType":1,"order":1},{"id":23355,"sectionId":8691,"title":"Definition","data":"Working knowledge of the processes required to develop, execute, and sustain plans, policies, programs, and practices that control, protect, deliver, and enhance the value of data and information systems and assets.
","itemType":1,"order":1},{"id":23360,"sectionId":8692,"title":"Definition","data":"Knowledge of the techniques, systems, tools, and human skills required to establish effective procedures to identify defective and missing products and then report onward, either internally or externally, ensuring closure on reports and improvements to avoid future repetition.
","itemType":1,"order":1},{"id":23365,"sectionId":8693,"title":"Definition","data":"The ability to balance deliveries from suppliers against constrained criteria. These criteria may be opening hours, FLT capacity, and docking facilities. The process involves negotiation with suppliers as well as capacity planning internally.
","itemType":1,"order":1},{"id":23370,"sectionId":8694,"title":"Definition","data":"Basic knowledge of scheduling and managing sourced product deliveries to meet inventory replenishment requirements or scheduled production plans.
","itemType":1,"order":1},{"id":23375,"sectionId":8695,"title":"Definition","data":"Experience with the function of recognizing all demands for goods and services to support the marketplace. It involves prioritizing demand when supply is lacking and analyzing and proactively managing business demand for new services or modifications to existing service features or volumes. Proper demand management facilitates the planning and use of resources for profitable business results.
","itemType":1,"order":1},{"id":23380,"sectionId":8696,"title":"Definition","data":"The ability to analyze the constraints and requirements of a product design cycle to evaluate and ensure the timely availability of the product design for the building and installation of a product.
","itemType":1,"order":1},{"id":23385,"sectionId":8697,"title":"Definition","data":"Ownership of the official, valid (not expired) document stating that the person is authorized and able to drive a class(es) of vehicles.
","itemType":1,"order":1},{"id":23389,"sectionId":8698,"title":"Definition","data":"Understanding the actions, tasks, and responsibilities concerned with observing and applying environmental, health, and safety rules and standards.
","itemType":1,"order":1},{"id":23394,"sectionId":8699,"title":"Definition","data":"Working awareness of relevant technology that could be used to improve the effectiveness or efficiency of operations within Source but also widely across the supply chain or the enterprise. Must be able to deploy with appropriate financial justification and by using project and change management support.
","itemType":1,"order":1},{"id":23399,"sectionId":8700,"title":"Definition","data":"Understanding the discipline, art, and profession of acquiring and applying technical, scientific, and mathematical knowledge to design and implement materials, structures, machines, devices, systems, and processes that safely realize a desired objective or invention.
","itemType":1,"order":1},{"id":23404,"sectionId":8701,"title":"Definition","data":"Knowledge of the end-to-end, cross-departmental, and often cross-company coordination of work activities that create and deliver ultimate value to customers.
","itemType":1,"order":1},{"id":23409,"sectionId":8702,"title":"Definition","data":"Familiarity with and understanding of internal and external goals, objectives, rules, and laws on the operation of the Source function within the organization. This also includes the ability to manage those requirements on behalf of the organization to meet strategic goals and knowledge of green building techniques and environmentally sensitive architecture.
","itemType":1,"order":1},{"id":23414,"sectionId":8703,"title":"Definition","data":"The ability to operate appropriate ERP systems relevant to the organization. ERP is an integrated computer-based system that manages internal and external resources including tangible assets, financial resources, materials, and human resources.
","itemType":1,"order":1},{"id":23419,"sectionId":8704,"title":"Definition","data":"The ability to estimate future demand. A forecast can be constructed using quantitative methods, qualitative methods, or a combination of methods, and it can be based on extrinsic (external) or intrinsic (internal) factors. Various forecasting techniques attempt to predict one or more of the four components of demand: cyclical, random, seasonal, and trend.
","itemType":1,"order":1},{"id":23424,"sectionId":8705,"title":"Definition","data":"The ability to identify and inspect sourced products for compliance with contractual part numbers, specifications, drawings, and quality requirements and to ensure that the product is correct and not damaged.
","itemType":1,"order":1},{"id":23429,"sectionId":8706,"title":"Definition","data":"Knowledge and understanding of the laws and regulations governing importing and exporting requirements for materials and products. This skill can require a professional to work with state and federal agencies and foreign governments to ensure compliance with laws governing importing and exporting materials and products.
","itemType":1,"order":1},{"id":23434,"sectionId":8707,"title":"Definition","data":"Knowledge of the information, resources, and skills requirements for effectively installing purchased products per customer requirements.
","itemType":1,"order":1},{"id":23438,"sectionId":8708,"title":"Definition","data":"The ability to manage the requirements and constraints associated with an installation schedule to schedule product installation effectively per customer requirements.
","itemType":1,"order":1},{"id":23442,"sectionId":8709,"title":"Definition","data":"The ability to manage the actions, tasks, and responsibilities of managing and monitoring company products installed and used worldwide. This includes managing product maintenance and information updates.
","itemType":1,"order":1},{"id":23447,"sectionId":8710,"title":"Definition","data":"Ability to effectively manage proprietary data and intellectual property on behalf of an organization. Proprietary data is internally generated data containing technical or other information controlled by an organization to safeguard its competitive edge. Proprietary data and intellectual property may be protected by copyright, patent, or trade secret laws.
","itemType":1,"order":1},{"id":23452,"sectionId":8711,"title":"Definition","data":"Understanding the exchange of capital, goods, and services across international borders or territories, including laws and regulations such as Incoterms and cross-border customs and duties implications.
","itemType":1,"order":1},{"id":23457,"sectionId":8712,"title":"Definition","data":"The ability to read, interpret, understand, and effectively communicate, internally and externally, technical specifications and drawings to support timely design and delivery of products meeting minimum requirements.
","itemType":1,"order":1},{"id":23461,"sectionId":8713,"title":"Definition","data":"The ability to formally manage the timing and quantities of goods to be ordered and stocked by an organization so that demand can always be satisfied without excess expenditures.
","itemType":1,"order":1},{"id":23466,"sectionId":8714,"title":"Definition","data":"Knowledge of the required specifications and details needed to generate and communicate a request for proposal or request for quote.
","itemType":1,"order":1},{"id":23470,"sectionId":8715,"title":"Definition","data":"The ability to understand, interpret and effectively communicate a part master record (item master) or a Bill of Material (BOM) parts lists that details descriptions, units of measure, dimensions, group and family classifications, production and sourcing data, quality requirements and restrictions, and other pertinent information. Such item masters and BOMs are typically maintained within enterprise resources planning or material requirements planning systems.
","itemType":1,"order":1},{"id":23475,"sectionId":8716,"title":"Definition","data":"Knowledge of the process of aggregating and packing all elements belonging to a customer order.
","itemType":1,"order":1},{"id":23480,"sectionId":8717,"title":"Definition","data":"The capability of calculating, understanding, reporting on, and, if necessary, taking corrective action to control labor costs within one’s area of responsibility against budgets or objectives. Labor cost is the total expenditure employers have to employ workers. This is in addition to wages or salaries.
","itemType":1,"order":1},{"id":23484,"sectionId":8718,"title":"Definition","data":"The ability to analyze and validate the feasibility of customer-required lead times.
","itemType":1,"order":1},{"id":23488,"sectionId":8719,"title":"Definition","data":"The ability to identify processes that impede the optimization of production. This also represents the ability to use various principles, such as value stream mapping, 5S, and root cause analysis, to identify waste and process inefficiencies and correct them to optimize production.
","itemType":1,"order":1},{"id":23493,"sectionId":8720,"title":"Definition","data":"Knowledge of the regulations, laws, and standards affecting Sourced products. Regulations, Laws, and Standards affect many parts of the Source activity. This skill also includes knowledge of, and experience with, managing conformance systems and correcting non-conformance issues.
","itemType":1,"order":1},{"id":23498,"sectionId":8721,"title":"Definition","data":"Understanding the branch of mathematics concerned with the minimization or maximization of a linear function of several variables and inequalities. Linear programming is used in many branches of industry to minimize costs or maximize production.
","itemType":1,"order":1},{"id":23503,"sectionId":8722,"title":"Definition","data":"The ability to consolidate orders to meet service, cost, delivery, and product specification requirements.
","itemType":1,"order":1},{"id":23508,"sectionId":8723,"title":"Definition","data":"Knowledge of the process of planning, implementing, and controlling the efficient, effective forward, and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption, whether a manufacturing facility, a warehouse, or distribution center, a retail location, or a customer’s home, to meet customer requirements and thus add value for the customer.
","itemType":1,"order":1},{"id":23513,"sectionId":8724,"title":"Definition","data":"Working knowledge of the management and integration of information, sourced products and materials, transportation, inventory, warehousing, material handling, packaging, and occasionally security between the point of origin and the point of consumption to meet customer requirements.
","itemType":1,"order":1},{"id":23518,"sectionId":8725,"title":"Definition","data":"The ability to identify opportunities for performance improvement using performance measures such as standards and indicators.
","itemType":1,"order":1},{"id":23523,"sectionId":8726,"title":"Definition","data":"The ability to efficiently and effectively allocate an organization's manufacturing resources and assets to meet customer demands and requirements. For service organizations, this skill may refer to the ability to allocate digital resources for making virtual products.
","itemType":1,"order":1},{"id":23528,"sectionId":8727,"title":"Definition","data":"Knowledge of coordinating and keeping track of all the different components related to the Source activity. Individual activities, such as deliveries, orders, clearances, and contract negotiations, will have their own schedules, but an overall perspective needs to be maintained both for the Source activity and the smooth operation of the whole supply chain.
","itemType":1,"order":1},{"id":23533,"sectionId":8728,"title":"Definition","data":"The ability to manipulate a variety of material-handling systems, including forklifts, conveyors and palletizers, to pick, pack and store orders and inventory.
","itemType":1,"order":1},{"id":23537,"sectionId":8729,"title":"Definition","data":"Working knowledge of contractual requirements for the authorization of monetary payments for successfully completing pre-defined development or performance milestones.
","itemType":1,"order":1},{"id":23541,"sectionId":8730,"title":"Definition","data":"Knowledge of the techniques used in material requirements planning systems to develop a detailed plan for product manufacturing. The MPS considers the requirements of various departments, including sales (delivery dates), finance (inventory minimization), and manufacturing (minimization of setup times), to schedule production and the purchasing of materials within the capacity of and the resources available to the production system.
","itemType":1,"order":1},{"id":23546,"sectionId":8731,"title":"Definition","data":"Understanding the actions required for retaining an item’s condition or restoring an item to a state in which it can perform its required functions. These actions include combining all technical, administrative, managerial, and supervisory activities.
","itemType":1,"order":1},{"id":23551,"sectionId":8732,"title":"Definition","data":"The abilities to ensure that materials and products are available for production and delivery to customers; maintain the lowest possible level of inventory; and plan manufacturing activities, delivery schedules, and purchasing activities.
","itemType":1,"order":1},{"id":23556,"sectionId":8733,"title":"Definition","data":"Working knowledge and understanding of strict regulatory adherence to health and environmental requirements and restrictions associated with particular products as detailed on material safety data sheets (MSDS) or certificates of compliance (COC) throughout product ordering, receipt, storage, staging, transportation, and final delivery.
","itemType":1,"order":1},{"id":23560,"sectionId":8734,"title":"Definition","data":"Familiarity with relevant office automation tools and the ability to justify their use based on financial considerations and project and change management requirements. Office automation tools are all tools and methods applied to office activities to improve their effectiveness or efficiency.
","itemType":1,"order":1},{"id":23564,"sectionId":8735,"title":"Definition","data":"Understanding the process of improving various aspects of a business to increase profits, improve products or boost customer satisfaction.
","itemType":1,"order":1},{"id":23569,"sectionId":8736,"title":"Definition","data":"Working knowledge of the process of contracting with another company to procure services that might otherwise be performed by the customer company’s in-house employees.
","itemType":1,"order":1},{"id":23574,"sectionId":8737,"title":"Definition","data":"Understanding the process for preparing goods for transportation, warehousing, logistics, sale, and end use. This process includes management of any written, electronic, or graphic communications on the packaging or on a separate but associated label.
","itemType":1,"order":1},{"id":23578,"sectionId":8738,"title":"Definition","data":"Working knowledge of the processes and policies required for contractual authorization of payments for sourced products and services. This includes basic financial accounting practices.
","itemType":1,"order":1},{"id":23583,"sectionId":8739,"title":"Definition","data":"The ability to complete a process through the use of dexterity, strength, or other capacities.
","itemType":1,"order":1},{"id":23587,"sectionId":8740,"title":"Definition","data":"Knowledge of the set of activities concerned with efficient movement of finished goods from the end of the production operation to the consumer.
","itemType":1,"order":1},{"id":23592,"sectionId":8741,"title":"Definition","data":"Understanding the process of selecting and collecting stock-keeping units and materials in a specified order and quantity to fulfill orders.
","itemType":1,"order":1},{"id":23597,"sectionId":8742,"title":"Definition","data":"Knowledge of how to use a planogram to diagram fixtures and products to illustrate how and where retail products should be displayed, usually on a store shelf, to increase customer purchases.
","itemType":1,"order":1},{"id":23601,"sectionId":8743,"title":"Definition","data":"The ability to analyze and set prices on a per-unit or per-volume basis to meet required characteristics, business rules, and business performance requirements.
","itemType":1,"order":1},{"id":23606,"sectionId":8744,"title":"Definition","data":"Knowledge and ability to arrange process steps, jobs, or orders in a queue or product receipts in the proper sequence to meet production and delivery deadlines.
","itemType":1,"order":1},{"id":23611,"sectionId":8745,"title":"Definition","data":"Working knowledge of the process for acquiring goods and services at the best possible total cost of ownership, in the right quantity and quality, at the right time and in the right place, and with all required documentation. This may include simple repetitive Make-to-Stock purchases, or more complex Make- to-Order or Engineer-to-Order products.
","itemType":1,"order":1},{"id":23616,"sectionId":8746,"title":"Definition","data":"The ability to analyze stated product and configuration specifications against required and feasible product performance, functional, and physical requirements.
","itemType":1,"order":1},{"id":23621,"sectionId":8747,"title":"Definition","data":"Understanding the process of removing a product from inventory and exchanging funds for the value of the product in a retail supply chain.
","itemType":1,"order":1},{"id":23625,"sectionId":8748,"title":"Definition","data":"Familiarity with and awareness of the product development process, its key steps, and its interaction with the Source activity. This also includes ensuring a seamless process with product development specialists, even if a supplier is handling the product development process while managing commercial and logistical demands and expectations and ensuring that risks and rewards are controlled throughout the process with suppliers.
","itemType":1,"order":1},{"id":23630,"sectionId":8749,"title":"Definition","data":"The ability to use software or other tools to capture and maintain information about products and services throughout their life cycles.
","itemType":1,"order":1},{"id":23635,"sectionId":8750,"title":"Definition","data":"Understanding the process of using machines, tools, materials, and labor to make things for use or sale.
","itemType":1,"order":1},{"id":23639,"sectionId":8751,"title":"Definition","data":"Understanding the actions, tasks, and responsibilities concerned with the planning, scheduling, and release of production orders to satisfy demand while optimizing the available and planned resources and capacity.
","itemType":1,"order":1},{"id":23644,"sectionId":8752,"title":"Definition","data":"Knowledge of the process of determining the production capacity, or maximum amount of work that an organization can complete in a given period of time, needed by an organization to meet changing demands for its products.
","itemType":1,"order":1},{"id":23649,"sectionId":8753,"title":"Definition","data":"The ability to define, implement and use metrics designed to track and improve process performance.
","itemType":1,"order":1},{"id":23654,"sectionId":8754,"title":"Definition","data":"The ability to plan, organize, and manage resources to successfully complete specific project goals and objectives.
","itemType":1,"order":1},{"id":23659,"sectionId":8755,"title":"Definition","data":"Working knowledge of policies, procedures, and processes required for the purchase, receipt, transportation, usage, and safeguarding of all company assets, including inventory and other sourced products. This includes regulatory requirements for proper disposal of excess.
","itemType":1,"order":1},{"id":23663,"sectionId":8756,"title":"Definition","data":"Knowledge of manufacturing systems in which production is based on a projected production plan and information flows from management to the market, in the same direction in which the materials flow.
","itemType":1,"order":1},{"id":23667,"sectionId":8757,"title":"Definition","data":"Understanding the organizational structure, procedures, processes, and resources needed to implement quality management.
","itemType":1,"order":1},{"id":23672,"sectionId":8758,"title":"Definition","data":"Understanding the process of systemically and physically moving materials from an in-bound supply source to a short- or long-term intermediate storage location.
","itemType":1,"order":1},{"id":23677,"sectionId":8759,"title":"Definition","data":"Understanding the actions, tasks, and responsibilities required for compliance with quality, legal and administrative, and internal rules and standards.
","itemType":1,"order":1},{"id":23682,"sectionId":8760,"title":"Definition","data":"Ability to understand, interpret and effectively communicate to contractors, suppliers or vendors product specifications and technical data that clearly delineate specific requirements regarding product acceptance.
","itemType":1,"order":1},{"id":23687,"sectionId":8761,"title":"Definition","data":"The ability to manage the allocation of defined specifications for the materials and services being procured. Defined specifications will be straightforward. Generic specifications will require a level of understanding and possible consultation with technical personnel.
","itemType":1,"order":1},{"id":23692,"sectionId":8762,"title":"Definition","data":"The ability to manage a system that ensures up-to-date specifications are available when required. This also requires confirming that an audit trail back to suppliers and internal quality exists.
","itemType":1,"order":1},{"id":23697,"sectionId":8763,"title":"Definition","data":"The ability to manage all aspects of requirements criteria, verification methods, and tools. Requirements criteria are statements of needs, rules, standards, or tests that must be used in evaluating decisions, ideas, opportunities, programs, or projects to form correct judgments regarding intended goals.
","itemType":1,"order":1},{"id":23702,"sectionId":8764,"title":"Definition","data":"Understanding the importance of requirements defect notification and managing a system to monitor for, analyze and highlight any defects that arise and then notify the appropriate personnel or processes for corrective action. Trend and pattern analysis is important here as well as the ability to ensure the correct flow of information to suppliers.
","itemType":1,"order":1},{"id":23707,"sectionId":8765,"title":"Definition","data":"The ability to assemble and then present internally and externally the requirements justification and rationale for a given requirement, such as quality requirements for a vital component or material supplied by a third party. Effective justifications and rationale will be linked to internal and external requirements and fulfill short-, medium- and long-term needs.
","itemType":1,"order":1},{"id":23712,"sectionId":8766,"title":"Definition","data":"The ability to demonstrate familiarity with the use of requirements syntax, attributes, and baselines. For example, attributes to consider would include feasibility, traceability on a higher level, completeness, testability, and level of ambiguity.
","itemType":1,"order":1},{"id":23717,"sectionId":8767,"title":"Definition","data":"The ability to execute the process of identifying and handling products or materials that require return or disposal, regardless of whether they are returned for warranty repairs; are unwanted, excess, damaged, defective, or expired goods; or are items needing maintenance, repair, and overhaul. This process must be executed in strict compliance with all contractual terms and conditions, applicable regulations, and environmental restrictions.
","itemType":1,"order":1},{"id":23722,"sectionId":8768,"title":"Definition","data":"The ability to develop, analyze and maintain an organizational return plan.
","itemType":1,"order":1},{"id":23727,"sectionId":8769,"title":"Definition","data":"Understanding the system for managing the returns of faulty products.
","itemType":1,"order":1},{"id":23732,"sectionId":8770,"title":"Definition","data":"Knowledge of the end-to-end activities, responsibilities, and tasks required to accept, operationally process, and successfully close the returns of products and materials that are unwanted, defective, need repair or refurbishment, or are ready to be recycled.
","itemType":1,"order":1},{"id":23737,"sectionId":8771,"title":"Definition","data":"Understanding the process by which specification and pricing proposals are evaluated, rated, and accepted or rejected based upon criteria and objectives of the overall sourcing process.
","itemType":1,"order":1},{"id":23742,"sectionId":8772,"title":"Definition","data":"The ability to identify, assess and prioritize risks and exceptions and then economically apply available resources to minimize, monitor, and control the probability and impact of unfortunate events.
","itemType":1,"order":1},{"id":23747,"sectionId":8773,"title":"Definition","data":"Working knowledge and ability to identify and analyze risks, their possible effects on an organization, and the likelihood of these risks occurring. Risks can affect performance criteria, schedule and cost objectives, and many other facets of business.
","itemType":1,"order":1},{"id":23752,"sectionId":8774,"title":"Definition","data":"The ability to discover, define, describe, document, and communicate supply chain risks before they become problems and adversely affect processes.
","itemType":1,"order":1},{"id":23757,"sectionId":8775,"title":"Definition","data":"The ability to systematically reduce the extent of exposure to a risk and minimize the likelihood of a risk’s occurrence.
","itemType":1,"order":1},{"id":23762,"sectionId":8776,"title":"Definition","data":"The ability to develop a plan to avoid risks and to mitigate the effect of risks that cannot be avoided. This also involves being able to identify covered assets and connect them to their applicable risk-response programs when a risk arises.
","itemType":1,"order":1},{"id":23767,"sectionId":8777,"title":"Definition","data":"The ability to select and schedule carriers and modes and determine the path the product will take from the first to the final stop of the journey based on order delivery requirements and geographic constraints.
","itemType":1,"order":1},{"id":23772,"sectionId":8778,"title":"Definition","data":"Understanding the process of reviewing and communicating the output of and changes to the S&OP plan.
","itemType":1,"order":1},{"id":23777,"sectionId":8779,"title":"Definition","data":"The ability to calculate the appropriate stocking levels to mitigate demand variability by considering all relevant lead times, variability during lead times, and desired service levels.
","itemType":1,"order":1},{"id":23782,"sectionId":8780,"title":"Definition","data":"Understanding the set of decision-making processes used to balance demand and supply; integrating financial planning and operational planning; and linking high-level strategic plans with the day-to-day operations necessary to achieve focus, alignment, and synchronization among all functions of the organization.
","itemType":1,"order":1},{"id":23787,"sectionId":8781,"title":"Definition","data":"A basic understanding of statistical analysis and working knowledge of and ability to apply the Six Sigma business methodology for improving the quality of process outputs by identifying and removing the causes of defects or errors and minimizing variability in business processes.
","itemType":1,"order":1},{"id":23792,"sectionId":8782,"title":"Definition","data":"An ability to request or seek bids, proposals, quotations, or requests for information or business. These pieces of information are only an indication of interest in doing business with a vendor and not a binding contract. In the context of Source, one should seek this type of information prior to agreeing to or executing contracts. Solicitation methods can take many forms, including electronic. Still, there is a skill in managing and analyzing this information to form an appropriate contract commensurate with the amount of investment needed.
","itemType":1,"order":1},{"id":23797,"sectionId":8783,"title":"Definition","data":"Understanding the process of identifying the products or services required and efficiently soliciting and procuring them. Also known as the competitive bidding process.
","itemType":1,"order":1},{"id":23802,"sectionId":8784,"title":"Definition","data":"Knowledge of the specific fabrication route for any given product. This information is particularly important for informing and illuminating the Source activity. Personnel in Source should be involved in, and be inquisitive about, this route.
","itemType":1,"order":1},{"id":23806,"sectionId":8785,"title":"Definition","data":"The abilities to define an organization’s strategy or direction and make decisions about allocating resources, including capital and people, to pursue company goals.
","itemType":1,"order":1},{"id":23811,"sectionId":8786,"title":"Definition","data":"Understanding how to approve and manage contracts in accordance with federal, state, and local laws and company guidelines. Subcontracting types can include firm-fixed-price contracts, cost-plus contracts, cost-plus-award-fee contracts, and performance-based contracts.
","itemType":1,"order":1},{"id":23816,"sectionId":8787,"title":"Definition","data":"The ability to work collaboratively with suppliers and maximize the potential value of those relationships to accomplish common goals and objectives. This is vital to organizational success.
","itemType":1,"order":1},{"id":23821,"sectionId":8788,"title":"Definition","data":"Knowledge and know-how of supply chain knowledge of the best practices and best-in-class systems needed to fulfill functions.
","itemType":1,"order":1},{"id":23826,"sectionId":8789,"title":"Definition","data":"Knowledge of how to manage a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers.
","itemType":1,"order":1},{"id":23831,"sectionId":8790,"title":"Definition","data":"Knowledge of the performance measurements and metrics used to set objectives, evaluate performance, and determine future courses of action in a supply chain.
","itemType":1,"order":1},{"id":23836,"sectionId":8791,"title":"Definition","data":"The ability to coordinate linked resources across all or part of a supply chain to eliminate or reduce manufacturing and logistics bottlenecks and create optimized schedules based on shared inventory and order information.
","itemType":1,"order":1},{"id":23841,"sectionId":8792,"title":"Definition","data":"Knowledge of the process of adding and enhancing the security of a supply chain. This process combines supply chain management practices with system security requirements, which are driven by digital and physical threats such as terrorism, piracy, and theft.
","itemType":1,"order":1},{"id":23845,"sectionId":8793,"title":"Definition","data":"Knowledge of the process of identifying, prioritizing, and aggregating, with constituent parts, all sources of required supply, and adding value to the supply chain of a product or service at the appropriate level, horizon, and interval.
","itemType":1,"order":1},{"id":23850,"sectionId":8794,"title":"Definition","data":"Understanding technical requirements and effectively communicating with other technical organizations within the enterprise and those providing the technical specifications. Many activities within the Source function require technical evaluation. Although Source personnel can seek expert opinions, they must have sufficient technical background to review any decision that requires a technical perspective.
","itemType":1,"order":1},{"id":23855,"sectionId":8795,"title":"Definition","data":"The ability to review documentation containing parts lists and instructions for installation, operation, use, and maintenance of a piece of equipment, machine, process, or system.
","itemType":1,"order":1},{"id":23860,"sectionId":8796,"title":"Definition","data":"Understanding the tests performed on a machine, component, or piece of software to ensure that it works properly before it is released for use.
","itemType":1,"order":1},{"id":23865,"sectionId":8797,"title":"Definition","data":"Knowledge of the management concept coined by W. Edwards Demings to reduce the errors produced during the manufacturing or service process, increase customer satisfaction, streamline supply chain management, aim for equipment modernization, and ensure workers have the highest level of training.
","itemType":1,"order":1},{"id":23870,"sectionId":8798,"title":"Definition","data":"The ability to analyze and select an appropriate transportation mode to meet cost and service objectives. This can include identifying, selecting, and linking a variety of modes to complete the product’s journey.
","itemType":1,"order":1},{"id":23875,"sectionId":8799,"title":"Definition","data":"The ability to conduct a logical, systematic search for the source of a problem so that it can be solved and so the product or process can be made operational again.
","itemType":1,"order":1},{"id":23880,"sectionId":8800,"title":"Definition","data":"Working knowledge of procurement and the VMI business model so that an individual can clearly and concisely communicate specific information to a supplier regarding a particular product for which the supplier has agreed to manage the inventory.
","itemType":1,"order":1},{"id":23885,"sectionId":8801,"title":"Definition","data":"Experience and familiarity with verification strategies in various aspects of the Source function, including supplier service, quality, and cost.
","itemType":1,"order":1},{"id":23889,"sectionId":8802,"title":"Definition","data":"Knowledge of the actions, processes, and rules related to regulating a party's commitment to its customers regarding the performance and quality features of its products and services.
","itemType":1,"order":1},{"id":23894,"sectionId":8803,"title":"Definition","data":"The ability to understand, coordinate and execute the Return processes for the return of products or materials covered under contractual warranty return and repair terms and conditions, including proper preparation of return authorization documentation and the coordination of any packaging, crating, and transportation required. This also may require coordination with other organizations within the enterprise for shipment or on-location repair by the supplier.
","itemType":1,"order":1},{"id":23899,"sectionId":8804,"title":"Definition","data":"Knowledge of the process of collecting, transporting, processing, recycling, or disposing of, and monitoring waste materials in accordance with federal, state, and local laws and company guidelines.
","itemType":1,"order":1},{"id":23903,"sectionId":8805,"title":"Definition","data":"Knowledge of the order management process used in distribution centers by which the picking workload for the day is divided into a series of comparable intervals, or \"waves.\" Wave data organizes the workload by order or function, such as case picking or repack picking. Within a wave, orders normally are consolidated to enable efficient picking by product.
","itemType":1,"order":1},{"id":23908,"sectionId":8806,"title":"Definition","data":"Knowledge of, and experience in, visualizing, articulating, conceptualizing, and solving simple, complex, and complicated problems by making logical and reasonable decisions given the available information.
","itemType":1,"order":1},{"id":23913,"sectionId":8807,"title":"Definition","data":"Knowledge of, and experience in, conducting objective comparisons of actions with policies and plans.
","itemType":1,"order":1},{"id":23918,"sectionId":8808,"title":"Definition","data":"Understanding the means, methods, and technologies that facilitate the substitution of machine work for human physical or mental work. Machines also can be used for work that could not otherwise be accomplished. In these cases, machines have less continuous interaction with humans than previous equipment used for similar tasks.
","itemType":1,"order":1},{"id":23923,"sectionId":8809,"title":"Definition","data":"Knowledge of, and experience in, coordinating and monitoring changes to the business processes, applications, equipment, resources, operating systems, and procedures to minimize the risk of problems that affect the operating environment and service delivery to the users.
","itemType":1,"order":1},{"id":23928,"sectionId":8810,"title":"Definition","data":"Knowledge of, and experience with, the categorization of inventory in a warehouse or supply chain, in general, to enable a company to make decisions based on the type of inventory.
","itemType":1,"order":1},{"id":23933,"sectionId":8811,"title":"Definition","data":"Knowledge of, and experience with, creating a document that specifies alternative project plans that can be used to facilitate project success in anticipation of a risk event.
","itemType":1,"order":1},{"id":23938,"sectionId":8812,"title":"Definition","data":"Understanding the overall scope and direction of the company and the way in which its various business functions and operations work together to achieve corporate goals.
","itemType":1,"order":1},{"id":23943,"sectionId":8813,"title":"Definition","data":"Knowledge of, and experience with, analyzing how costs are consumed throughout the supply chain by products, services, and customers to determine which products, services, or customers contribute most to the company’s profits and which erode them.
","itemType":1,"order":1},{"id":23948,"sectionId":8814,"title":"Definition","data":"Knowledge of gathering and understanding information regarding the perceived value customers seek from the purchase of a product or service.
","itemType":1,"order":1},{"id":23953,"sectionId":8815,"title":"Definition","data":"Understanding the practice of dividing a customer base into groups of individuals similar in demographics, psychological profiles, geography, attitudes, behaviors, or other characteristics relevant to marketing.
","itemType":1,"order":1},{"id":23958,"sectionId":8816,"title":"Definition","data":"Knowledge of, and experience with, identifying and handling cases that deviate from the norm, such as supplier nonperformance and strikes. These critical matters should take priority.
","itemType":1,"order":1},{"id":23963,"sectionId":8817,"title":"Definition","data":"Knowledge of the function concerned with ensuring the availability of funds for research and development, operations, and marketing.
","itemType":1,"order":1},{"id":23968,"sectionId":8818,"title":"Definition","data":"Knowledge of the task of building an abstract representation or model of a real-world financial situation, such as the performance of a financial asset or portfolio.
","itemType":1,"order":1},{"id":23973,"sectionId":8819,"title":"Definition","data":"The ability to research and comprehend the abilities and performance of fleets and carriers in terms of average transit time, reliability, equipment availability and capacity, geographic coverage, product protection, freight rates, and other factors.
","itemType":1,"order":1},{"id":23978,"sectionId":8820,"title":"Definition","data":"Knowledge of politics, especially international relations, as influenced by geographical factors.
","itemType":1,"order":1},{"id":23983,"sectionId":8821,"title":"Definition","data":"Knowledge of, and experience in, solving problems by utilizing results or rules that have been determined by experience or intuition instead of by optimization. Heuristics can be used in areas such as forecasting; lot sizing; determining production, staff, or inventory levels; and choosing distribution center locations.
","itemType":1,"order":1},{"id":23988,"sectionId":8822,"title":"Definition","data":"Knowledge and understanding of an organization’s goals for and approach to inventory management.
","itemType":1,"order":1},{"id":23993,"sectionId":8823,"title":"Definition","data":"Knowledge of, experience with, and understanding of, financial or nonfinancial measures, either strategic or tactical, that are linked to specific strategic goals and objectives.
","itemType":1,"order":1},{"id":23998,"sectionId":8824,"title":"Definition","data":"Knowledge of categorizing materials to appropriately describe and label them and using the right packaging, storage, and mode of transportation for each item.
","itemType":1,"order":1},{"id":24003,"sectionId":8825,"title":"Definition","data":"Knowledge of, and experience in, conducting discussions aimed at agreeing on the conditions surrounding purchasing a product or service.
","itemType":1,"order":1},{"id":24008,"sectionId":8826,"title":"Definition","data":"Knowledge of, and experience in, determining a supply chain's physical configuration and infrastructure related to the quantity, locations, and size of manufacturing plants and warehouses and assigning retail outlets to warehouses.
","itemType":1,"order":1},{"id":24013,"sectionId":8827,"title":"Definition","data":"Knowledge of, and experience in, creating a concise picture of the sequence of tasks needed to bring a product or service from inception to completion.
","itemType":1,"order":1},{"id":24018,"sectionId":8828,"title":"Definition","data":"Knowledge of, and experience in, analyzing two or more sets of records to ensure their figures are accurate and in agreement and settling and resolving any variances between the records. As an example, inventory reconciliation involves comparing physical inventory figures with the perpetual inventory record and making any necessary corrections.
","itemType":1,"order":1},{"id":24023,"sectionId":8829,"title":"Definition","data":"Knowledge of, and experience in, conducting systematic, empirical investigations of quantitative or qualitative factors that affect the performance of logistics or supply chain strategy.
","itemType":1,"order":1},{"id":24028,"sectionId":8830,"title":"Definition","data":"Knowledge of the plan that positions a company's brand or product to gain a competitive advantage.
","itemType":1,"order":1},{"id":24033,"sectionId":8831,"title":"Definition","data":"Knowledge of, and experience in, creating positive relationships with stakeholders through the appropriate management of their expectations and agreed objectives.
","itemType":1,"order":1},{"id":24038,"sectionId":8832,"title":"Definition","data":"Knowledge of different models of inventory strategies, including just-in-time, material requirements planning, and economic order quantity, that best meet the business needs of cost, risk, and customer satisfaction.
","itemType":1,"order":1},{"id":24043,"sectionId":8833,"title":"Definition","data":"Knowledge of, and experience in, engaging across companies and suppliers to document the exact source of every material, process, and shipment involved in bringing goods to market.
","itemType":1,"order":1},{"id":24048,"sectionId":8834,"title":"Definition","data":"Knowledge of, and experience in, analyzing data to determine whether any upward or downward trend exists.
","itemType":1,"order":1},{"id":24053,"sectionId":8835,"title":"Definition","data":"Knowledge of, and experience in, measuring the economic, social, and environmental consequences of a firm’s activities.
","itemType":1,"order":1},{"id":24058,"sectionId":8836,"title":"Definition","data":"Understanding of, and experience in, using a system that manages all processes, including receiving, picking, and shipping, carried out in a warehouse.
","itemType":1,"order":1},{"id":24063,"sectionId":8837,"title":"Definition","data":"Understanding of, and experience with, using a system that organizes and directs the traffic of all vehicles in the parking yards of various industrial buildings, including warehouses, distribution centers and manufacturing plants.
","itemType":1,"order":1},{"id":24068,"sectionId":8838,"title":"Definition","data":"The ability to examine a supplier's price proposal or bid by comparing it with reasonable benchmarks. This step does not include evaluating the separate elements of cost and profit that make up the final price.
","itemType":1,"order":1},{"id":24073,"sectionId":8839,"title":"Definition","data":"The ability to study historical data, analyze the effects of certain decisions or events, evaluate the performance of a given tool, scenario, or process, find potential trends, determine why an event occurred, and even predict future events, like routine maintenance, traffic patterns or demand. Data Analytics seeks to glean information that can help improve performance and the business overall.
","itemType":1,"order":1},{"id":24078,"sectionId":8840,"title":"Definition","data":"The ability to plan, identify, control, account for, and audit configuration items (CIs) and their interrelationships.
","itemType":1,"order":1},{"id":24083,"sectionId":8841,"title":"Definition","data":"Understanding of, and experience with establishing, measuring, monitoring, and adjusting limits or levels of capacity to execute all manufacturing schedules (i.e., the production plan, master production schedule, material requirements plan, and dispatch list). Capacity management is executed at four levels: resource requirements planning, rough-cut capacity planning, capacity requirements planning, and input/output control.
","itemType":1,"order":1},{"id":24088,"sectionId":8842,"title":"Definition","data":"The ability to manage and control the operation of formal contracts for the supply of products and services.
","itemType":1,"order":1},{"id":24093,"sectionId":8843,"title":"Definition","data":"Understanding of, and experience with, all the planned and systematic activities implemented within the quality system that can be demonstrated to provide confidence that a good or service will fulfill the customer’s requirements for quality.
","itemType":1,"order":1},{"id":24098,"sectionId":8844,"title":"Definition","data":"The ability to manage the process of obtaining formal confirmation that service acceptance criteria have been met.
","itemType":1,"order":1},{"id":24103,"sectionId":8845,"title":"Definition","data":"Understanding organizational and stakeholder objectives and needs and distilling these down into detailed solution requirements. Ensuring that requirements are appropriately managed and traced.
","itemType":1,"order":1},{"id":24108,"sectionId":8846,"title":"Definition","data":"Systems thinking is a way of making sense of the complexity of the world by looking at it in terms of wholes and describing the world as a series of relationships between causes and effects.
","itemType":1,"order":1},{"id":24112,"sectionId":8847,"title":"Definition","data":"Supply chain simulation is the imitation of the operation of a real-world supply chain process or system over time. Supply chain simulation requires the use of supply chain modeling. The supply chain simulation represents the evolution of the model over time.
","itemType":1,"order":1},{"id":24116,"sectionId":8848,"title":"Definition","data":"Understanding of, and experience with, the activity of developing a model of the supply chain which represents the key characteristics or behaviors of the selected supply chain process or system.
","itemType":1,"order":1},{"id":24120,"sectionId":8849,"title":"Definition","data":"The ability to use various desktop and field analytical research tools to gather primary and secondary data about the supply market and critically analyze the results to understand supply market conditions. Tools include segmentation tools, SWOT analysis, STEEPLE, and Porter Five forces model.
","itemType":1,"order":1},{"id":24125,"sectionId":8850,"title":"Definition","data":"The skills needed to engage various stakeholders to understand the actual business needs, such as stakeholders' management, communication skills, and negotiation skills.
","itemType":1,"order":1},{"id":24130,"sectionId":8851,"title":"Definition","data":"Understanding of, and experience with, activities that would include formally scheduled meetings and a project management approach to specifications. Early supplier involvement with suppliers, drafting the final specifications with performance or conformance requirements, and using international standards as references to specifications.
","itemType":1,"order":1},{"id":24135,"sectionId":8852,"title":"Definition","data":"Experience with the set of skills needed to put out an invitation to tender regarding the supply of goods and services, including the ability to solicit offers, create invitations to tenders, conduct supplier briefings, run the tender opening, bids evaluation, decision making on awarding and all the documentations needed in the tendering process.
","itemType":1,"order":1},{"id":24140,"sectionId":8853,"title":"Definition","data":"The ability to use qualitative and quantitative measures to either evaluate offers received in the solicitation process, prequalify suppliers, or post-evaluate a vendor. Actions include setting criteria and weight for all activities, a TCO approach, and calculating the results of the comparison. Qualitatively, this skill requires observation during suppliers’ meetings and visits to draw conclusions.
","itemType":1,"order":1},{"id":24145,"sectionId":8854,"title":"Definition","data":"The technical and intuitive knowledge that individuals in the supply chain possess about what works well in certain scenarios and what have proven record of success. This skill requires experience and high exposure to management trends and various work environments.
","itemType":1,"order":1},{"id":24150,"sectionId":8855,"title":"Definition","data":"The ability to work with others in the supply chain such as suppliers and other stakeholders; includes the ability to create win-win situations, being a team player, finding middle ground with partners and teams. Focuses on relationships (sharing ideas and information), belief in the benefits of collaboration, and trying to encourage a culture of collaboration.
","itemType":1,"order":1},{"id":24155,"sectionId":8856,"title":"Definition","data":"The ability to actively and skillfully conceptualize, apply, analyze, synthesize, and/or evaluate information gathered from, or generated by, observation, experience, reflection, reasoning, or communication, as a guide to belief and action in various supply chain scenarios.
","itemType":1,"order":1},{"id":24160,"sectionId":8857,"title":"Definition","data":"The ability to organize and plan how to divide time between different activities. to get more done in less time by prioritizing tasks, goal setting, and scheduling activities.
","itemType":1,"order":1},{"id":24165,"sectionId":8858,"title":"Definition","data":"Understanding of, and experience with, a cost and managerial accounting system that accumulates costs and revenues into three areas—throughput, inventory, and operating expense. This system does not create incentives (through the allocation of overhead) to build up inventory. It is considered to provide a truer reflection of actual revenues and costs than traditional cost accounting and is closer to a cash flow concept of income than traditional accounting. It provides a simplified and more accurate form of direct costing that subtracts true variable costs (those costs that vary with throughput quantity). Unlike traditional cost accounting systems in which the focus is placed on reducing costs in all the various accounts, the primary focus of TOC accounting is on aggressively exploiting the constraint(s) to make more money for the firm.
","itemType":1,"order":1},{"id":24170,"sectionId":8859,"title":"Definition","data":"The ability to use a series of pre-defined commercial terms published by the International Chamber of Commerce relating to international commercial law. These terms do not cover property rights.
","itemType":1,"order":1},{"id":24174,"sectionId":8860,"title":"Definition","data":"The ability to use analytical methods to determine the core problem(s) of an organization, process, product, market, and so forth. See: current reality tree, five whys, stratification analysis.
","itemType":1,"order":1},{"id":24178,"sectionId":8861,"title":"Definition","data":"Understanding of, and the ability to calculate, the total cost of ownership. In supply chain management, the total cost of ownership of the supply delivery system is the sum of all the costs associated with every activity of the supply stream. The main insight that TCO offers to the supply chain manager is the understanding that the acquisition cost is often a very small portion of the total cost of ownership.
","itemType":1,"order":1},{"id":24183,"sectionId":8862,"title":"Definition","data":"Understanding of, and experience with, a third party that provides product delivery services for a buyer and supplier team. This third party may provide added supply chain expertise.
","itemType":1,"order":1},{"id":24188,"sectionId":8863,"title":"Definition","data":"Understanding of, and experience with, a fourth-party logistics firm. Typically, a 4PL is a separate entity formed by a joint venture, or a long-term contract between a client and one or more partners, and will offer an interface between the client and multiple logistics services providers, managing all aspects of the client’s supply chain.
","itemType":1,"order":1},{"id":24193,"sectionId":8864,"title":"Definition","data":"The ability to translate operational tasks and activities into key performance indicator impacts and then overlay the impact on financial metrics.
","itemType":1,"order":1},{"id":24198,"sectionId":8865,"title":"Definition","data":"Understanding of, and experience with, using only one supplier for a purchased part. A sole source situation occurs when the supply of a product is available from only one organization. A single source situation occurs when only one supplier supplies a purchased part in a market where there is at least one additional source for that part. Traditional manufacturers usually have at least two suppliers for each component part they purchase to ensure continuity of supply and (more so) to foster price competition between the suppliers. A JIT manufacturer frequently has only one supplier for a purchased part, so close relationships can be established with a smaller number of suppliers. These close relationships (and mutual interdependence) foster high quality, reliability, short lead times, and cooperative action.
","itemType":1,"order":1},{"id":24203,"sectionId":8866,"title":"Definition","data":"The awareness and usage of sustainability standards and frameworks for process design, environmental metrics, and sustainability reporting. Sustainability standards and frameworks provide guidance on how to design, measure and operationalize sustainable supply chains. Examples of sustainability standards include: GRI standards, ASCM Enterprise Certification for Sustainability Standards, UN Sustainable Development Goals, and GHG Protocol for emissions accounting.
","itemType":1,"order":1},{"id":24208,"sectionId":9314,"title":"Definition","data":"Best practices are current, structured and repeatable practices that have had a proven and positive impact on supply chain performance. Current means that these practices are not emerging or outdated. Structured means that they feature a clearly stated goal, scope, process and procedure. Proven denotes that they have been demonstrated in a work environment and that they are linked to key metrics. Repeatable shows that they have been proven in multiple organizations and industries.
SCOR best practices have been chosen by SCOR practitioners in diverse industries. It is understood that not all best practices will yield the same results for all industries or supply chains.
","itemType":1,"order":1},{"id":24210,"sectionId":9522,"title":"Definition","data":"Supply Chain Risk Management (SCRM) is the identification, and prioritization of supply chain risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities.
","itemType":1,"order":1},{"id":24215,"sectionId":9523,"title":"Definition","data":"Risk Management Strategies are developed and communicated to reduce or eliminate risks. Commonly used strategies include the following:
- Risk mitigation is a plan to reduce the probability of occurrence or minimize the impact of a risk.
- Risk avoidance is used when the probability of occurrence and potential impact is too high or beyond the threshold limits of the organization’s appetite for risk.
- Risk transfer is used when part or all of the risk can be transferred to another process where it can be better managed or mitigated through less costly actions - Risk acceptance occurs when a risk has a low probability of occurrence and low impact, and the company has a contingency plan that can be easily deployed if the risk occurs.
Risk management strategies may differ by supply chain.
","itemType":1,"order":1},{"id":24220,"sectionId":9459,"title":"Definition","data":"Single-Minute Exchange of Die (SMED) is the practice of reducing the amount of time it takes to change a production line, piece of equipment, or machine from running one product to the next. The ability to rapidly change between products is increasingly important in markets where lot sizes are reducing. In general, there are four focus areas to reduce change over time:
- Eliminate non-essential activities. This includes replacing only essential parts and developing universal parts when possible.
- Prepare and set up as much of the production as possible before moving the task to the production line, piece of equipment, or machine.
- Prepare the die through heating, flushing, calibration, and alignment prior to the changeover.
- Simplify the setup inside the equipment. This includes the use of single- or limited- touch fasteners and auto- or self-aligning pins.
Similar to: Single-touch exchange of die.
Note: The single-minute description is a reference to the quick speed of the changeover and not a measurement of the actual number of minutes required for the changeover.
","itemType":1,"order":1},{"id":24225,"sectionId":9524,"title":"Definition","data":"Network Prioritization for Risk Identification is the process of prioritizing parts of a supply chain for risk analysis based on the overall risk potential in each portion of the supply chain. Prioritization typically is based on the criticality of the component or product flowing through a portion of the supply chain and the number of sources for the material flowing through that portion of the supply chain.
","itemType":1,"order":1},{"id":24230,"sectionId":9525,"title":"Definition","data":"Self-Invoicing or self-billing is the practice in which a customer generates the invoices for the products or services it consumes from a supplier. The advantage of this process for the company that self-invoices is that reconciliation processes, such as three-way verification prior to payment of invoices, are no longer required. Instead, the reconciliation processes are transferred to the supplier.
A common application of this process is Self-Invoicing for transportation services and materials consumed from supplier-owned or consignment inventory.
Conditions for self-invoicing include
- clear service-level agreements between the supplier and the customer
- clear ways to measure the level and quality at which the services were delivered or the materials were consumed
- defined and agreed processes for record-keeping, reporting, and handling claims
- standards for electronic data communication between the supplier and customer.
Consignment inventory is not a prerequisite for Self-Invoicing. Materials ordered from a master contract may also qualify for Self-Invoicing.
","itemType":1,"order":1},{"id":24235,"sectionId":9410,"title":"Definition","data":"Consignment Inventory is a method of organizing source processes in which the ownership of material transfers is based on a signal further down the supply chain, such as in the Make or Deliver activity. For regular inventory, the ownership transfer usually is triggered by the receipt of materials and the verification of the condition of the materials received. The Consignment Inventory practice is designed to delay the ownership transfer to the completion of an activity, such as assembly, production, or shipment to the customer. Application of Consignment Inventory does not lower the physical inventory by default; it impacts ownership of the inventory. Implementation of Consignment Inventory will free up cash. These inventories, generally of finished goods, are in the possession of customers, dealers, agents, brokers, etc., but remain the property of the manufacturer by agreement with those in possession.
Alternative names: Supplier-Owned Inventory, Vendor-Owned Inventory
Note: Under Consignment Inventory, the responsibility to plan and replenish inventory levels does not transfer to the supplier. (See Vendor-Managed Inventory (VMI) (BP.122).) In addition, the supplier does not perform any warehousing activities. Consignment Inventory can be combined with outsourced warehousing and Vendor-Managed Inventory to increase the benefits.
","itemType":1,"order":1},{"id":24240,"sectionId":9411,"title":"Definition","data":"Baseline Inventory Monitoring helps to avoid overstock situations, companies should regularly review their baseline inventory levels. Baseline inventory is defined as the lowest stock level that a particular stock keeping unit actually reached during the last 12 months. This means that there will be a baseline inventory for all those items that did not have a stockout. At maximum, the baseline inventory should match the safety stock. If it is significantly higher than the safety stock, the planning parameters and buffers in the system need to be reviewed. To evaluate a whole product range, calculate the total aggregate value of baseline inventory. The metric is expressed as a total value, the number of items affected, and the percentage of overall stock value.
This practice will be most effective in a more stable environment with established products. In a highly dynamic market environment, an important outcome of sales and operations planning will be the setting of strategic buffer stocks for key items. To check whether the buffer stocks are on a reasonable level, baseline evaluation can be used.
","itemType":1,"order":1},{"id":24245,"sectionId":9412,"title":"Definition","data":"Slow-Moving Inventory Monitoring is a regular review of slow-moving inventory levels done by companies to avoid overstock situations. As part of this process, companies should evaluate the financial value, number, and storage costs of those stock-keeping units with stock levels that are higher than their total consumption within the last 12 months. Slow-moving inventory are those inventory items with a low turnover; items in inventory that have a relatively low rate of usage compared to the normal amount of inventory carried.
There are various causes for slow-moving inventory. In most cases, there are constraints in terms of time and quantity of supply, such as minimum lot sizes, constrained equipment, or expected shortages of raw materials, that cause a supply-demand imbalance.
To evaluate a whole product range, calculate the total aggregate value of slow-moving inventory. The metric is expressed as a total value, the number of items affected, and the percentage of overall stock value.
Then, slow-moving items are classified into three reason codes: opportunistic stock, technical (supply) reasons, and market (demand) reasons. Newly introduced items are separated from the measurement.
This practice can be applied for any kind of inventory except newly introduced items.
","itemType":1,"order":1},{"id":24250,"sectionId":9413,"title":"Definition","data":"Kanban is a method of just-in-time production that uses standard containers or lot sizes with a single card attached to each. It is a pull system in which work centers signal with a card that they wish to withdraw parts from feeding operations or suppliers. The Japanese word kanban, loosely translated, means a card, billboard, or sign, but other signaling devices such as colored golf balls have also been used. The term is often used synonymously for the specific scheduling system developed and used by the Toyota Corporation in Japan. Kanban is an inventory replenishment technique in which a material is replenished based on consumption. Today Kanban can be implemented using different technological solutions, but a classic example of Kanban is the two-bin-system. One bin is at the point of consumption, for example, on the factory floor, and the second bin is in the process to be filled and placed behind the first. Once the first bin is depleted, it will be sent to be filled, and the second bin now becomes the first bin.
Here’s an example formula to calculate the bin size for a two-bin system:
Minimum bin size = [Projected consumption per time unit] x [Cycle time to replenish, in time units] / [number of bins]
100 per day x 3 days / 2 bins = 150 items.
This formula does not deal with variations in projected consumption or cycle time, but it illustrates that a Kanban system does not need to be complex. The minimum bin size compensates for the cycle time to refill an empty bin. The number of bins can be increased to reduce the amount of material in each bin.
Example applications of Kanban today use Kanban cards to signal the need to replenish stock at the point of use. This might shorten the cycle time of the process and thus decrease the bin size. It also might create additional packing materials that need to be disposed of. Enterprise resources planning systems can replace physical Kanban cards with electronic signals and dashboards.
","itemType":1,"order":1},{"id":24255,"sectionId":9414,"title":"Definition","data":"Min-Max Replenishment, also known as the order-point system, is an inventory replenishment practice in which purchase requisitions or purchase orders are created when inventory for an item drops below the minimum inventory level. The requisition or order quantity will bring the inventory back to the maximum inventory level. The order quantity is variable and is the result of the maximum minus available or on-order inventory. Min-Max Replenishment methods are generally implemented through automation. Different configuration options exist for Min-Max Replenishment:
Physical Min-Max Replenishment incorporates on-hand inventory; existing customer orders are not included in the calculations. This option has characteristics close to a Kanban system.
Logical Min-Max Replenishment nets customer orders from the on-hand inventory. If this inventory the net of the orders is less than the minimum order quantity, a requisition or order will be created. This aligns with available-to-promise or capable-to-promise practices. Further details may include netting only clean orders or netting all orders. Clean orders are orders that are free of customer holds, credit holds, or other types of holds.
The calculation of the minimum level includes replenishment cycle time and a buffer for variability in demand and cycle times. The maximum level is preferably the minimum level plus economic order quantity.
Generally, Min-Max Replenishment requires process automation. Reordering is triggered by running a replanning program or report.
","itemType":1,"order":1},{"id":24260,"sectionId":9460,"title":"Definition","data":"Production Line Sequencing is the practice in which materials are ordered, shipped, received, and staged in the same sequence as they will be consumed. The materials generally are configurable or have many variants, such as different colors. This practice can be applied in on-site processes and in supplier-to-manufacturer processes:
On-site processes: The materials are picked from an inventory location, such as a raw material warehouse, in the exact sequence of the production schedule or line and delivered to the point of use. The operator is required to use the materials in the sequence they were provided. This can apply to materials sourced using S1, S2, and S3 processes. Supplier-to-manufacturer processes: The materials are ordered from the supplier in sequence. The supplier processes the order and loads the transportation vehicle in sequence. The materials are then unloaded and delivered to the point of use in sequence. This version applies to S2 and S3 sourcing only.
It is important that order managers, material handlers, and operators understand that the materials should always remain in sequence. Accidental sequencing may cause erroneous products, dangerous working conditions, and rework. Example physical implementations include conveyor systems but also the use of trays or bins that allow the materials to be kept in sequence during transportation and handling.
Alternative names: Just-in-sequence, in-line vehicle sequencing
","itemType":1,"order":1},{"id":24264,"sectionId":9390,"title":"Definition","data":"Lot Tracking is the practice of storing information about the history and genealogy of a product or material. This may include where it was sourced, the different materials used to make it, the grade of the materials, and other product genealogy information. Lot Tracking has three fundamental requirements, namely:
- a means to identify the lot or serial number
- a system to record milestones for each lot or serial number
- a process to retrieve information by lot or serial number.
Lot Tracking may make use of bar coding, radio frequency identification tags, or other visual or electronic methods to identify the lot. Modern enterprise resources planning and other specialized supply chain systems generally offer lot recording and display functionality. Hardware and operator or handler instructions may be required to read the lot identifiers and communicate the event or milestone to the recording system.
To establish a Lot Tracking system, it is important to understand what information needs to be collected, where and at what level. The scope of where information is collected may extend beyond the boundaries of an organization to its customers or its customers’ customers. The need for Lot Tracking may be dictated by regulatory requirements, risk mitigation strategies, process excellence initiatives, or customer requirements.
Alternative names: Serial tracking, serial or lot tracking, lot history, lot tracking and tracing, material traceability
","itemType":1,"order":1},{"id":24269,"sectionId":9514,"title":"Definition","data":"Item Rationalization, which also is called stock keeping unit (SKU) or product rationalization, involves decision-making related to adding, deleting, or retaining products, services, or features within a portfolio offering. Some strategies call for these decisions to be made at the product family level. Rationalization should consider at what stage of manufacturing the item becomes customized as well as how close to the customer order the customization should occur to optimize operational costs and limit complexity. Given the multiple factors and tradeoffs implicit in rationalization decisions, Item Rationalization should be considered an element of, but not a substitute for, a more comprehensive supply chain complexity management approach.
Item Rationalization is important throughout the entire product life cycle. After the product introduction process, an item must be periodically reviewed to identify its stage in its life cycle.
A rationalization exercise should identify the most cost-effective way to deliver the product to the market throughout its life cycle while taking into account factors like the cost to serve, margin, sales projections, as well as what other products and services are better enabled by the item.
","itemType":1,"order":1},{"id":24274,"sectionId":9496,"title":"Definition","data":"Demand Planning and Forecasting is the practice of using state-of-the-art forecasting algorithms for product life cycle planning and trade promotion planning.
Understanding and predicting customer demand is vital for manufacturers and distributors to avoid stockouts and maintain adequate inventory levels. Although forecasts are never perfect, they are necessary to prepare for actual demand. In order to maintain optimized inventory and an effective supply chain, accurate demand forecasts achieved through the most advanced algorithms are imperative. The algorithms or mathematical models are the core of demand and supply management solutions. They make it possible to seamlessly work at any level of aggregation and along any dimension such as product, channel, or customer with ease yet without rigid forecast pyramids. Typically, Demand Planning and Forecast is accomplished through the process of combining statistical forecasting techniques and judgment to construct demand estimates for products or services (both high and low volume; lumpy and continuous) across the supply chain from the suppliers’ raw materials to the consumer’s needs. Items can be aggregated by product family, geographical location, product life cycle, and so forth, to determine an estimate of consumer demand for finished products, service parts, and services. Numerous forecasting models are tested and combined with judgment from marketing, sales, distributors, warehousing, service parts, and other functions. Actual sales are compared to forecasts provided by various models and judgments to determine the best integration of techniques and judgment to minimize forecast error.
Success measurement: Forecast accuracy in the supply chain is typically measured using the mean absolute percent error (MAPE). Statistically, MAPE is defined as the average percentage of errors. Most practitioners, however, define and use MAPE as the mean absolute deviation (MAD) divided by average or mean sales. This is, in effect, a volume-weighted MAPE. This also is referred to as the MAD/mean ratio.
A simpler and more elegant method to calculate MAPE across all the products forecasted is to divide the sum of the absolute deviations by the total sales of all products.
","itemType":1,"order":1},{"id":24279,"sectionId":9415,"title":"Definition","data":"Safety Stock Planning enables companies to meet desired customer service levels while maintaining a minimum amount of safety stock.
The standard methods of Safety Stock Planning are used to build stock on hand according to the safety stock values that companies define in their location product master, depending on previous experience. In contrast with model-based Safety Stock Planning, forecast errors are not considered when using the standard methods. Safety stock values can be maintained as static or time-dependent values.
The advanced methods of Safety Stock Planning are used to calculate the time-dependent safety stock for finished products and components. In this type of planning, the system considers the demand forecasts and forecast errors within the supply chain. In general, a quantity of stock is planned to be in inventory to protect against fluctuations in demand or supply. 2) In the context of master production scheduling, the additional inventory and capacity are planned as protection against forecast errors and short-term changes in the backlog. Overplanning can be used to create safety stock.
","itemType":1,"order":1},{"id":24284,"sectionId":9316,"title":"Definition","data":"Supply Network Planning involves simulating and implementing comprehensive tactical planning and sourcing decisions based on a single, globally consistent model. The practice enables organizations to create a very close match between supply and demand by integrating purchasing, manufacturing, distribution, and transportation into one consistent model. By modeling the entire supply network and related constraints, it is possible to synchronize activities and plan material flow throughout the entire supply chain. The results are feasible plans for purchasing, manufacturing, inventory, and transportation.
The process also includes enabling organizations to dynamically determine how and when inventory should be distributed. The supporting system optimizes deployment plans based on available algorithms as well as user rules and policies.
","itemType":1,"order":1},{"id":24289,"sectionId":9381,"title":"Definition","data":"Distribution Planning is a method that helps determine the best short-term strategy to meet demand and replenish stocking locations. Distribution planning activities typically include planning activities associated with transportation, warehousing, inventory levels, materials handling, order administration, site and location planning, industrial packaging, data processing, and communications networks to support distribution.
Distribution Planning enables the user to set certain inventory control parameters, such as safety stock, and calculate the time-phased inventory requirements. This process also is commonly referred to as distribution requirements planning (DRP).
","itemType":1,"order":1},{"id":24294,"sectionId":9416,"title":"Definition","data":"The ABC Inventory Classification System is a Pareto analysis of a range of inventory items, which are classified into three or four inventory categories. The ABC system requires different levels of inventory control for each of the categories. The classification of a group of items in decreasing order of annual dollar volume (price multiplied by projected volume) or other criteria. This array is then split into three classes, called A, B, and C. The A group usually represents 10 percent to 20 percent by the number of items and 50 percent to 70 percent by projected dollar volume. The next grouping, B, usually represents about 20 percent of the items and about 20 percent of the dollar volume. The C class contains 60 percent to 70 percent of the items and represents about 10 percent to 30 percent of the dollar volume. The ABC principle states that effort and money can be saved through applying looser controls to the low-dollar volume class items than to the high-dollar volume class items. The ABC principle is applicable to inventories, purchasing, and sales. A common calculation is the standard cost multiplied by the quantity used per time period. The system can be structured simply:
Calculate the 12-month forecasted spend at standard cost for all inventory components.
Rank the items in descending order.
The A items are at the top and should account for 50-70% of total annual spend.
The B items make up the next 20% of total annual spend.
The C items are the remaining items making up the last 10-30%.
Excess and obsolete inventory still on the books can be labeled as D items.
The tables below provide an example of ABC classification.
Table 1: Item Annual Spend
| Table 1: Item Annual Spend | ||||
| Item | Standard Cost | Quantity/Year | Total Spend | % Annual Spend |
| 98236 | $0.10 | 5,000 | $500.00 | 3.64 |
| 76342 | $30.00 | 200 | $6,000.00 | 43.64 |
| 92134 | $12.00 | 400 | $4,800.00 | 34.9 |
| 37542 | $0.50 | 2,000 | $1,000.00 | 7.27 |
| 67733 | $3.00 | 100 | $300.00 | 2.18 |
| 19534 | $1.00 | 400 | $400.00 | 2.90 |
| 39866 | $2.50 | 300 | $750.00 | 5.45 |
Table 2: ABC Classification
| Table 2: ABC Classification | ||
| Item | % Annual Spend | Classification |
| 76342 | 43.64 | A |
| 92134 | 34.90 | A |
| 37542 | 7.27 | B |
| 39866 | 5.45 | B |
| 98236 | 3.64 | B |
| 67733 | 2.18 | C |
| 19534 | 2.90 | C |
Note: Percentage (%) of Annual Spend in the example may not add to 100 because of rounding.
ABC classification is used to create the audit sampling tables used during daily cycle counts to monitor perpetual inventories. Enterprise resources planning systems can randomly generate cycle counts based on ABC classification. Root Cause Analysis and closed loop corrective action are used to correct discrepancies found during the cycle counts, improve system reliability, and eliminate stockouts.
","itemType":1,"order":1},{"id":24299,"sectionId":9497,"title":"Definition","data":"Demand Management takes Demand Planning to the next level and integrates the plan up and down the supply chain as well as across the enterprise. It takes a holistic view of a multi-unit enterprise, its markets, and its trade partners’ capabilities. Using sophisticated software tools and web technologies, supply chain managers can aggregate demand, manage inventories, and respond in near real-time to changes in demand. Multiple, real-time applications are used within a Demand Management process to analyze and evaluate changes in demand and the impact on supply. Demand Management establishes priorities when supply is lacking and facilitates the planning and use of resources for profitable business results.
In marketing, it’s the process of planning, executing, controlling, and monitoring the design, pricing, promotion, and distribution of products and services to bring about organizational and individual needs.
Centralized systems and applications that are capable of receiving, monitoring, and processing information in real-time from various business unit enterprise resources planning (ERP) systems are used in the Demand Management process. These applications are agnostic of operating systems and ERP applications and can operate as part of the enterprise information technology infrastructure or as a software-as-a-service application.
","itemType":1,"order":1},{"id":24304,"sectionId":9498,"title":"Definition","data":"Sales and Operations Planning (S&OP) is a mid- to long-term supply chain planning practice that seeks to compare the forecast sales plan with the company resources, including production capacity, people, and raw materials, and analyze where any imbalances to the plan might exist.
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 financial) into one integrated set of plans. S&OP 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 definitive statement of the company’s plans for the near to intermediate term, covering a horizon sufficient to plan for resources and to support the annual business planning process. Executed properly, the S&OP process links the strategic plans for the business with its execution and reviews performance measurements for continuous improvement.
S&OP is a strategic tool normally reviewed by the executive or senior management team, which then makes decisions to remove any imbalances. Common actions include making changes to shift patterns, headcounts or inventory policies.
","itemType":1,"order":1},{"id":24309,"sectionId":9499,"title":"Definition","data":"Material Requirements Planning (MRP) is a set of techniques that uses bill of material data, inventory data, and the master production schedule (MPS) to calculate requirements for materials. It makes recommendations to release replenishment orders for material. Further, because it is time-phased, it makes recommendations to reschedule open orders when due dates and need dates are not in phase.
Time-phased MRP begins with the items listed on the MPS and determines
- the quantity of all components and materials required to fabricate those items
- the date that the components and material are required.
Time-phased MRP is accomplished by exploding the bill of material, adjusting for inventory quantities on hand or on order, and offsetting the net requirements by the appropriate lead times.
MRP is a Plan scheme of the different inventory management practices that have been adopted by a company in a mixed-model manufacturing environment. Manufacturing models can include Assemble-to-Order, Make-to-Order or Make-to-Stock, among others.
","itemType":1,"order":1},{"id":24314,"sectionId":9317,"title":"Definition","data":"Business Rule Management is a practice in which business rules in a human-readable form are used by, but not embedded in, supply chain systems. The business rules should be visible, easily modified by non-programmers, and usable by any application and channel.
Business Rule Management formalizes a supply chain's critical business rules in a language that business and information technology staff can understand. Business rules are established to help an organization achieve its goals and are an unambiguous statement to support decision-making. The formal specification of a business rule becomes information for process and rules engines to run.
Business rules tend to fall into one of the following four categories:
-Definitions of business terms: The most basic element of a business rule is the language used to express it. The very definition of a term is itself a business rule that describes how people think and talk about it. Terms have traditionally been documented in glossaries or as entities in a conceptual model.
- Facts relating terms to each other: The nature or operating structure of an organization can be described in terms of the facts that relate terms to each other. To say that a customer can place an order is a business rule. Facts can be documented as natural language sentences or as relationship attributes and generalization structures in a graphical model.
- Constraints or action assertions: Every enterprise constrains behavior in some way. These types of business rules determine who may or may not do certain things, like make changes to certain rules, procedures, or documents.
- Derivations: Business rules, including laws of nature, define how knowledge in one form may be transformed into other knowledge, possibly in a different form.
Organizations striving to incorporate Business Rule Development and documentation into their data stewardship efforts should consider the following points:
Focus on the major business activities of each subject area to discover the currently relevant and foremost business rules.
Include the examination of business rules that use human judgment as well as system activities so that the rules that document actions are not limited by what an application does. Examine current workflows and processes and new activities to discover essential business rules that may have been hidden.
-Review the process for defining, maintaining, and enforcing business rules.
-Identify other practices within the organization that creates business rules in the form of mandates, policies, or guidelines.
- Identify a process for retiring ineffective or outdated business rules and the documentation of this change.
Develop basic business rules during any data definition effort. Record the rules and the associated metadata, building from known and established rules to new or undefined business rules.
Effective business rules should
-be written and made explicit -be expressed in plain language
- exist independent of procedures and workflows
- build on facts, which build on concepts as represented by terms in glossaries
- guide or influence behavior in desired ways.
- be motivated by identifiable and important business factors
- be accessible to authorized parties through collective ownership
- be single-sourced
- be specified directly by those people who have relevant knowledge - be managed.
Note: Business rules management systems (BRMS) support the automation of the Business Rule Management practice.
","itemType":1,"order":1},{"id":24319,"sectionId":9318,"title":"Definition","data":"Supply Chain Optimization (SCO) is a part of the enterprise strategic plan for leading-edge companies. SCO allows top management to redesign the supply chain as part of the enterprise`s overall strategy, typically in response to actual or anticipated changes in the marketplace. Based on actual data or analyst projections, companies run multiple computer simulations to look for an optimal solution for business challenges such as:
- the total number of vendors and their current and prospective locations and inventory levels
- the total number of manufacturing, retail, service, warehousing, and distribution facilities and their prospective locations
- global transportation costs
- product life cycle management
- local, state, national, and international regulations
- carbon footprint and other environmental considerations.
Improvements are planned in a proactive rather than a reactive manner, which provides a financial and velocity advantage over competitors.
Optimized supply chains have shorter cash-to-cash cycles, shorter customer lead times, lower inventory requirements, lower excess and obsolete inventories, and lower transportation costs.
Technology providers offer individual applications and complete sets of optimization software packages in both information technology enterprise and software-as-a-service solutions.
","itemType":1,"order":1},{"id":24324,"sectionId":9526,"title":"Definition","data":"Self-Service Warranty Claim Submittal enables customers and service providers to submit warranty claims through the internet, reducing internal validation and processing workload. This can be accomplished as a batch load of several claims at the same time or as individual claims submitted one at a time. Information captured at the time of submittal helps with further analysis and disposition.
Results of the analysis can be made available online based on login access levels so that the same information can be submitted to appropriate authorities as needed. Furthermore, auto-approval and auto-payment of certain claims can be considered.
","itemType":1,"order":1},{"id":24329,"sectionId":9417,"title":"Definition","data":"Improve Sales and Operations Planning (S&OP) Process directs supply chain management teams to establish a disciplined, monthly cross-functional process to increase the accuracy of demand management or forecasting, establish a business inventory policy, and reach agreements on demand and supply balancing.
","itemType":1,"order":1},{"id":24334,"sectionId":9418,"title":"Definition","data":"Pull-Based Inventory Replenishment is an approach that utilizes customer demand as the impetus or pull to replace and optimize inventory while also reducing total net landed cost. It has been a widely recognized, effective practice for decades.
With a pull-based approach, the signal to replenish downstream inventory is driven by actual demand or usage, rather than by a forecast that pushes products and materials into the supply chain. Pull-based replenishment uses a methodology that focuses on historical demand variability between forecasted demand versus real customer demand to identify the appropriate inventory levels.
","itemType":1,"order":1},{"id":24339,"sectionId":9419,"title":"Definition","data":"Inventory Optimization is the use of multi-echelon, random optimization. The optimization happens simultaneously across all inventory stocking points in the supply chain, and it accounts for random variability. This practice is traditionally used for the replenish-to-forecast work process as an alternative to pull-based replenishment, but it also can be used to calculate reorder points.
","itemType":1,"order":1},{"id":24344,"sectionId":9420,"title":"Definition","data":"Supply chains and supply networks both describe the flow and movement of materials and information through linked organizations that work together to serve the end customer. Network Optimization can be used to determine optimal manufacturing and warehouse locations based on the goal of reducing total supply chain costs, which typically is based on reducing transportation costs. This is done by reviewing a supply chain network of product-supplying and market-facing businesses to consolidate inventory-stocking locations.
","itemType":1,"order":1},{"id":24349,"sectionId":9391,"title":"Definition","data":"Inventory Record Accuracy is an established, disciplined monthly process to ensure timely reporting of accurate inventory at manufacturing and terminal locations. This involves ensuring that physical inventory matches the inventory counted in the enterprise resources planning system and identifying sitting inventory that is not identified by a stock keeping unit.
","itemType":1,"order":1},{"id":24354,"sectionId":9421,"title":"Definition","data":"Stock Keeping Unit (SKU) Rationalization and Cost of Sales Analysis is an inventory-reduction practice that helps determine which SKUs that can be terminated through a cost of sales analysis. This practice may require working with customers to determine the potential to change to another SKU or to make the decision to abandon a given SKU because of poor sales.
","itemType":1,"order":1},{"id":24359,"sectionId":9422,"title":"Definition","data":"Reduce or Write Off Slow-Moving Inventory is a process for analyzing and determining what inventory can be written off because of age, shelf life, or lack of demand. This practice usually is governed by how much the organization is willing or able to write off based on its reserves and the impact on its financial statement.
","itemType":1,"order":1},{"id":24364,"sectionId":9500,"title":"Definition","data":"Traditional Demand Forecasting Improvement refers to the use of more sophisticated qualitative and quantitative forecasting processes and tools to improve a customer demand forecast, typically at the stock keeping unit level. This would be an improvement on the traditional forecasting process, and it can be combined with additional opportunities, such as sales and operations planning, which uses forecasting modeling.
Examples of qualitative forecasting methods include
- informed opinion and judgment
- Delphi method
- market research
- historical life cycle analogy.
Examples of quantitative forecasting methods include
- last period demand
- arithmetic average
- simple moving average (N period)
- weighted moving average (N period)
- simple exponential smoothing
- multiplicative seasonal index.
","itemType":1,"order":1},{"id":24369,"sectionId":9423,"title":"Definition","data":"Collaborative inventory planning can be used as a way to extend supply chain planning with key customers. It can be done through a joint sales and operations planning (S&OP) meeting with each key customer and supplier to discuss how to manage demand and supply across the extended enterprise. These meetings should include reviews of historical and future customer demand, demand forecast accuracy, planned outages by customer or supplier, long-term planning, and other considerations. In collaborative forecasting, the supply chain members jointly maintain and update a single forecasting process in the system. Hence, forecasting information becomes centralized.
","itemType":1,"order":1},{"id":24374,"sectionId":9319,"title":"Definition","data":"Business rules for an organization are the policies or procedures that define or constrain some aspect of the business and are meant to provide guidance. Business Rule Review is performed regularly by an organization’s middle- or upper-level supply chain managers, whether on a weekly, monthly, quarterly, semiannual, or annual basis. In this practice, the manager ensures that the framework for analysis of a business rule is in line with the objectives and strategy of the organization as well as the operational aspects the rule governs. The rule should be clearly defined and linked to the respective business process or processes.
","itemType":1,"order":1},{"id":24379,"sectionId":9424,"title":"Definition","data":"Consignment inventory is a family of business models in which the buyer of a product provides certain information to a supplier of that product and the supplier takes full responsibility for maintaining an agreed amount of the material, usually at the buyer's consumption location. Consignment inventory can be combined with additional opportunities, such as extended inventory planning across suppliers by using collaboration. The intent is to have suppliers carry raw material inventory on their balance sheets until it is consumed.
","itemType":1,"order":1},{"id":24384,"sectionId":9382,"title":"Definition","data":"Manufacturing Direct or Drop Shipment is the practice of shipping products and goods directly from the manufacturing plant to the customer, bypassing consolidation activities in warehouses and distribution centers. In retail, direct shipment, also called drop shipment, is a supply chain management technique in which the retailer does not keep goods in stock. Instead, the retailer transfers customer orders and shipment details to either the manufacturer or a wholesaler, who then ships the goods directly to the customer.
Using direct shipment will bypass a distribution network and may reduce the distribution of finished goods inventory based on customer locations. Direct shipment can be combined with additional opportunities, such as Inventory Management Using Supply Chain Network Optimization (BP.029).
","itemType":1,"order":1},{"id":24389,"sectionId":9461,"title":"Definition","data":"Batch-Size Reduction is the practice of using Lean principles to reduce the size of manufacturing batches to better match customer demand rather than asset utilization or quality issues. Historically, manufacturing companies have operated with large batch sizes to maximize machine utilization, assuming that changeover times were fixed and could not be reduced. Because Lean calls for the production of parts to customer demand, the ideal batch size is one. However, a batch size of one is not always practical, so the goal is to practice continuous improvement to reduce the batch size to the smallest size possible. Reducing batch sizes reduces the amount of work-in-process inventory (WIP) as well as inventory carrying costs. In addition, production lead time or cycle time is approximately directly proportional to the amount of WIP. Therefore, smaller batch sizes shorten the overall production cycle, enabling companies to deliver more quickly and invoice sooner, which results in improved cash flow. Shorter production cycles also increase inventory turns and allow the company to operate profitably at lower margins, which enables price reductions that, in turn, increase sales and market share.
Batch-Size Reduction can be combined with additional opportunities, such as Right Size Frequency of Production Wheel (BP.039) or reorder point production models, which follow pull-based replenishment.
","itemType":1,"order":1},{"id":24394,"sectionId":9462,"title":"Definition","data":"Rightsized Frequency of Production Wheel refers to the use of Lean principles to increase the frequency and agility of a production wheel or production cycle in order to modify production planning and right size finished goods and work-in-process inventory. This can be combined with Batch-Size Reduction (BP.038) or reorder point production models, which follow pull-based replenishment.
","itemType":1,"order":1},{"id":24399,"sectionId":9425,"title":"Definition","data":"MTO Order Fulfillment Strategy involves evaluating the potential to change an order fulfillment strategy from Make-to-Stock to MTO for a given stock keeping unit to offset the need to carry inventory because of infrequent or low demand. The key here is to also have manufacturing flexibility and agility to be able to make this changeover in a short period of time so that customer demands still can be met. MTO is a production environment where a good or service can be made after receipt of a customer’s order. The final product is usually a combination of standard items and items custom designed to meet the special needs of the customer. Where options or accessories are stocked before customer orders arrive, the term assemble-to-order is frequently used. This practice can be combined with Stock Keeping Unit (SKU) Rationalization and Cost of Sales Analysis (BP.031).
","itemType":1,"order":1},{"id":24404,"sectionId":9426,"title":"Definition","data":"Transportation Optimization involves evaluating the potential to change inbound or outbound transportation modes to faster modes, depending on freight terms, to accelerate the transfer of inventory to customers, to better match supply and demand, and optimize inventory balances. This practice can be combined with additional strategies such as risk pooling and deciding to source from local stocking points to reduce cycle time.
","itemType":1,"order":1},{"id":24409,"sectionId":9427,"title":"Definition","data":"Procurement Terms and Conditions Review involves monthly, quarterly, or annual evaluation of potential changes to procurement contract terms with suppliers to
- focus on potential inventory impacts caused by early deliveries, delivery quality, receipt inspection, vendor-managed inventory, incentives, technology enablement through radio frequency identification and barcoding, and shipment notifications to carriers
- minimize raw material inventory levels
- consolidate internal business purchasing contracts with shared raw material suppliers to one global purchasing contract to leverage global buying power.
This practice can be combined with additional opportunities, such as reducing customer consignment stock or enabling supplier collaboration.
","itemType":1,"order":1},{"id":24414,"sectionId":9527,"title":"Definition","data":"Inventory Financing Evaluation involves evaluating the potential to use an external finance company to purchase inventory that is in transit or in certain circumstances and sell it back to the originating company prior to delivery to the customer. Some of the other larger third-party logistics companies and technology service providers offer this as a value-added service as part of international transportation.
","itemType":1,"order":1},{"id":24419,"sectionId":9428,"title":"Definition","data":"Delay Inbound Supplier Shipments is the practice of analyzing and executing a delay in inbound supplier raw material shipments to reduce raw material costs at summer break, the end of the year, or during another scheduled plant closure. This would defer any additional raw material inventory, based on plant shutdown and restart timing, to only what is absolutely required at a plant location.
","itemType":1,"order":1},{"id":24424,"sectionId":9429,"title":"Definition","data":"Finished Goods Inventory Postponement is the process of determining and executing optimum placement and volume for inventory in the value stream. This practice requires analyzing the value stream, identifying opportunities for demand pooling of materials, and conducting a detailed analysis of required delivery and cumulative lead times as well as manufacturing and logistics capabilities.
This practice can be combined with additional opportunities, such as changing the order fulfillment strategy from Make-to-Stock to Make-to-Order and decoupling point analysis.
","itemType":1,"order":1},{"id":24429,"sectionId":9366,"title":"Definition","data":"Demand Shaping involves the balancing of the cost and value of offering discounts for customers to place orders for specific finished good products in inventory. This practice typically requires processes and tools to identify and analyze the value proposition or trade-off. Organizations may be able to leverage other commercial tools to analyze payment incentives.
","itemType":1,"order":1},{"id":24434,"sectionId":9501,"title":"Definition","data":"Proper predictive models are the key to being able to proactively manage developing problems rather than reactively coping with the missed milestones. Lean Planning creates real-world project plans that robustly model the project from initiation to final delivery.
Beginning with the end deliverable is the best way to create a tactical plan. Lean Planning identifies the information flow between tasks and pushes back this information one task at a time during the planning process. This creates a robust project model that identifies all of the work that must be completed to accomplish the end deliverable of the project.
Lean planning uses five focusing questions:
1. What is this deliverable?
2. Who makes this happen?
3. What's the last significant action that he or she does?
4. What tangible inputs does he or she need?
5. Are these enough?
At the end of planning, each task is described with a variety of details, including
- all required resources
- all required inputs
- the expected amount of time to complete the task at a 50% confidence level
- the guaranteed amount of time to complete the task at a 95% confidence level
- the quantifiable output that clearly signals the end of the task.
","itemType":1,"order":1},{"id":24438,"sectionId":9430,"title":"Definition","data":"Design for Logistics (DFL) Management is a part of the new product development process that works to embed reuse and risk assessment into inventory management. The design of products that considers all aspects of a product’s movement and storage pertaining to manufacturing, packaging, shipping, warehousing, merchandising, and repackaging for returns. The chosen design is intended to control logistics costs, increase customer service levels, facilitate ease of transport, and facilitate ease of shelving within distribution centers and stores. Other considerations include environmental impacts and security. For example, DFL Management can include an assessment of the new product’s potential inventory management impact. Such impacts could include ending the life cycle of another product and commercial agreements for potential inventory and working capital exposure.
This also can include taking steps to design outer packaging for the product that will protect the product during storage and transportation while also enabling bulk shipping and supporting efficient cube utilization to unlock transportation and distribution savings. The outer packaging also can be designed to accommodate returned items, if needed.
","itemType":1,"order":1},{"id":24443,"sectionId":9431,"title":"Definition","data":"Manufacturing Reliability Improvement involves the use of reliability tools and the implementation of work process roles within manufacturing to address manufacturing reliability. It incorporates analysis and simulation of the manufacturing process to identify opportunities to increase equipment reliability and improve manufacturing costs, capacity, and service factors.
","itemType":1,"order":1},{"id":24448,"sectionId":9432,"title":"Definition","data":"Manufacturing Quality Improvements for Return Reduction consists of efforts to address manufacturing quality and improve manufacturing cost, capacity, and service factors. This would require analysis or simulation of quality losses and returns as well as opportunities for inventory reduction. Manufacturing Quality Improvements for Return Reduction also includes formulating a process and timeline by which to move off-grade or returned products off the books.
","itemType":1,"order":1},{"id":24453,"sectionId":9528,"title":"Definition","data":"Freight Carrier Delivery Performance Evaluation is the practice of conducting formal freight carrier performance reviews to reduce the risk of landed cost budget variances and poor delivery performance. A formal evaluation is crucial because transportation partners represent the interface between suppliers and customers. The quality of delivery on time and in good condition has enormous impacts on customer satisfaction, return rates and repeat sales
A carrier evaluation program needs a comprehensive list of evaluation metrics to reflect overall service performance and cost-improvement objectives. Evaluation criteria should include quantitative as well as qualitative measures. Quantitative criteria could include on-time delivery performance, claims ratios, billing accuracy, cost performance and other measurable criteria. Qualitative measures may include driver and sales representative responsiveness, the quality of customer service, stakeholder surveys, customer complaints or other value-based assessments.
In addition, a freight carrier’s delivery performance and impact related to supply lead-time variability due to both early and late deliveries should be evaluated. If a product arrives late to a customer, the party does not have the needed amount of inventory. Conversely, if a shipment arrives prior to the need date, then the customer has to carry the excess inventory. To correct these issues, the involved parties should investigate the reasons behind these early and late deliveries, which can include the supplier purposely shipping the product early to move inventory quickly or the receiving company wants to delay shipment until inventory is needed. Then, determine how to better manage such situations, such as by adjusting the transit lead time.
","itemType":1,"order":1},{"id":24458,"sectionId":9433,"title":"Definition","data":"Supplier Raw Material Quality Assurance provides analysis of the potential value that could be gained from raw material inventory reduction. It requires analysis or simulation of the current impact of raw material quality and opportunities for reducing inventory while improving quality.
This practice can be combined with additional opportunities, such as embedding inventory management goals in purchasing.
","itemType":1,"order":1},{"id":24463,"sectionId":9434,"title":"Definition","data":"Inventory Management Training involves developing an inventory management training curriculum and monitoring key employee participation and completion. Key employees typically include schedulers, planners and supply chain managers. Training should also expose key employees to emerging best practices and technologies.
This can be done with existing online training courses as well as trade organization meetings and events.
","itemType":1,"order":1},{"id":24467,"sectionId":9435,"title":"Definition","data":"Unsold inventory ties up money that can't be used for other purposes. A company should use Reduce Non-Strategic Inventory Level to identify idle assets and reduce or sell the non-strategic inventory. This involves analyzing production records and reviewing stock status reports to isolate slow-moving and out-of-balance inventory.
This practice includes selling obsolete and excess inventory by establishing and offering short-term discounts to turn inventory to cash.
","itemType":1,"order":1},{"id":24472,"sectionId":9392,"title":"Definition","data":"Master Data Accuracy requires the regular revalidation of existing master data items, such as those about order lead times, replenishment times, transit times and other factors, to ensure that the data matches current operational capabilities and performance. This information is used in inventory reorder point setting and target setting to determine inventory replenishment size and frequency. This is a critical step in inventory management and requires monthly repetition to provide accurate and reliable information to the number of processes and systems that rely on this information as key input variables. It also is important to establish a clear role, responsibility, and accountability for master data management.
This practice is a critical prerequisite for a wide range of inventory opportunities. It also can be combined with additional strategies, including pull-based replenishment.
","itemType":1,"order":1},{"id":24476,"sectionId":9436,"title":"Definition","data":"Optimize Sourcing Decisions to Local Source Point is the practice of assessing the potential to source from a local source point, likely the optimal source point, rather than a distant one to reduce overall replenishment lead time. This would reduce both transportation and inventory costs and could impact service-level and revenue objectives, depending on balance demand and supply decisions. Consider using an advanced planning system to optimize sourcing decisions.
This practice can be combined with additional opportunities, such as Network Optimization (BP.029).
Note: Buying less expensive materials from a remote supplier with associated higher inventory levels might be more economical than sourcing more expensive per unit materials from a nearby supplier with associated reduced inventory levels. Hence, the overall effect should be considered.
","itemType":1,"order":1},{"id":24481,"sectionId":9437,"title":"Definition","data":"Safety stock is a quantity of stock planned to be in inventory to protect against fluctuations in demand or supply. Safety Stock Reduction is the practice of pursuing a more aggressive reorder point or safety stock target replenishment stance that increases the risk of a stockout. This can be done quickly to help mitigate a potential sharp downturn in demand. It also includes evaluating the costs of holding raw materials and the amount of material or supply compared with demand.
This practice can be combined with additional opportunities, such as pull-based replenishment or Inventory Optimization (BP.028).
Note: Service-level targets, balancing inventory with the service level and a potential sharp upturn in demand should also be considered.
","itemType":1,"order":1},{"id":24486,"sectionId":9438,"title":"Definition","data":"Returns Policy to Reduce Returns Inventory involves evaluating and establishing a business returns policy and determining its impact on overall inventory management. The policy should include rules for handling buyer’s remorse, defective items, instances in which the buyer purchased more items than it needed, and items that are covered by warranty as well as a procedure for a root-cause investigation to determine and eliminate the causes of returns. Organizations also should develop plans for reusing or reselling returned items when possible. To determine the policy’s impact, proactively model potential returned inventory levels. Include these models in projected overall inventory levels, and then determine appropriate inventory costing.
Note: Organizations should consider their competitors’ return policies when creating their own policies.
","itemType":1,"order":1},{"id":24491,"sectionId":9439,"title":"Definition","data":"Returns Inventory Reduction is the practice of developing a process for efficiently receiving, processing, and disposing of returned products. The cycle time in this returns process can be reduced through the use of an automated enterprise resources planning system.
This practice can be combined with additional opportunities, such as Returns Policy to Reduce Returns Inventory (BP.066).
","itemType":1,"order":1},{"id":24496,"sectionId":9440,"title":"Definition","data":"Supplier Delivery Performance Analysis is the practice of monitoring and evaluating key suppliers on cost, quality, engineering, purchasing, and so on, based on an agreed set of measurements including the on-time delivery performance of suppliers. It is important to take action for large-volume or -value orders of raw materials to ensure that there is no consistent early receipt of raw materials. To support this effort, train planners and manufacturing, and warehouse staff not to accept early shipments. Also, consider penalizing suppliers for early shipments.
","itemType":1,"order":1},{"id":24501,"sectionId":9441,"title":"Definition","data":"Raw Materials Receiving Process is the practice of developing a strategy for efficiently receiving and processing raw materials from suppliers to minimize the amount of time to receive raw materials. Components of this process may include advanced shipping notifications, receiving inspections, bar code label scanning, use of master pack labels, use of shrink wrap, and efficient receiving and put-away procedures.
This practice can be combined with additional opportunities, such as Supplier Performance Reporting (BP.068).
","itemType":1,"order":1},{"id":24506,"sectionId":9492,"title":"Definition","data":"Planning and Scheduling Inventory Training is important for improving employee knowledge of inventory control and inventory management. When employees are more skilled at methods of inventory management, the organization can lower its inventory levels/improve its Inventory Days of Supply (DOS).
","itemType":1,"order":1},{"id":24511,"sectionId":9442,"title":"Definition","data":"Modal Optimization is the practice of balancing the trade-off between logistics cost reduction and increased capital costs. Factors for identifying the dimensional size to minimize freight costs include shipment lot size, per-shipment setup costs, consumption of and demand for raw materials, and storage capacity.
","itemType":1,"order":1},{"id":24515,"sectionId":9529,"title":"Definition","data":"Inbound Return Material Authorization (RMA)–Enabled Processing is a transaction (document) that describes a product return and authorizes the acceptance of returned items. A signatory authorization is normally required to return the goods and has a unique RMA number.
","itemType":1,"order":1},{"id":24520,"sectionId":9530,"title":"Definition","data":"Returns Receiving Refurbishment is the practice of refurbishing materials during the receiving or Source processes for returned materials.
This practice enables shorter processing cycle times through the refurbishment of materials that have been deemed eligible for rework and return. Specifically, when defective materials are returned and processed by the receiving function, repairs, modifications, or enhancements are made by the same receiving personnel, rather than sending the materials to personnel who handle the Transform process elements. Then the materials are sent to the shipping function for return to the original recipient. This practice would only be used for a subset of refurbishment situations, such as for high-volume repair returns or for materials that only require minor modifications and requires additional training for and capabilities from receiving personnel. The benefits of this practice include shorter overall return processing times and reduced capacity requirements from existing assets and processes related to the Transform process elements.
","itemType":1,"order":1},{"id":24525,"sectionId":9367,"title":"Definition","data":"Process and Metrics Alignment refers to the organized and deliberate development of metrics across an organization. The process starts with developing organizational, business, or supply chain metrics and then moves to developing metrics for organizational processes and more specific levels if desired.
Good metrics
- are aligned to supply chain and business strategies
- have a clear line of sight to the customer or business objective
- provide a balanced view of performance
- are data-driven
- offer an unflinching measure of the truth
- are actionable
- answer the following questions: Where are we now? Where do we want to be?
Metrics alignment can be accomplished by following these steps:
1. Define supply chains utilizing the SCOR methodology. This typically involves creating a matrix of product family versus customer group. (See example below.)
| Supply Chain Definition Matrix | |||||
| Geography, Market or Customer | |||||
| Retail | Distributors | Direct | OEM | Government | |
| Food Products | X | X | X | X | |
| Technology Products | X | X | |||
| Durable Products | X |
2. Prioritize supply chain performance attributes as defined in the SCOR model. These are Reliability, Responsiveness, Agility, Cost, and Assets. This step requires clear documentation of performance priorities by supply chain based on competitive pressure and customer requirements.
| Competitive Requirements | |||||
| Retail | Distributors | Direct | OEM | Government | |
| Reliability | Superior | Parity | Parity | Parity | Parity |
| Responsiveness | Parity | Parity | Superior | Superior | Parity |
| Agility | Advantage | Advantage | Advantage | Advantage | Advantage |
| Cost | Advantage | Superior | Advantage | Advantage | Superior |
| Assets | Parity | Advantage | Parity | Parity | Advantage |
3. The next step is to define key metrics for each supply chain. Utilizing the five performance attributes as the framework, select appropriate SCOR level 1 supply chain metrics.
| Performance Attribute | Strategic Metric | Current Performance |
| Reliability | Perfect Order Fulfillment | 79% |
| Responsiveness | Order Fulfillment Cycle Time | 9 days |
| Agility | Upside Flexibility | 110 days |
| Cost | Total Cost to Serve | 89% |
| Assets | Cash-to-Cash Cycle Time | 164 days |
4. Once metrics are defined at the supply chain level (level 1), then operational metrics should be selected or derived from this baseline. (See the example diagram below)
Bar Coding is a method of encoding data using bar codes for fast and accurate readability.
","itemType":1,"order":1},{"id":24535,"sectionId":9532,"title":"Definition","data":"More and more companies are providing Prepaid Return Shipping Labels and instructions for return at the time a product is sold and shipped to the customer. Common examples include instructions for returning an item if the customer is not satisfied with it or instructions for sending in an empty container, such as an ink cartridge, for a refill. In these cases, the return freight cost has been pre-negotiated, the original shipping package can be reused for the return, and the return label is coded with a tracking number for further tracking via the transportation company.
","itemType":1,"order":1},{"id":24540,"sectionId":9533,"title":"Definition","data":"Return Tracking allows customers to track their return shipment by using the tracking number assigned by the carrier when they are returning a product. If the same information is provided to the vendor during the return material authorization process, the receiving department can better plan for the receipt of the returned product.
","itemType":1,"order":1},{"id":24545,"sectionId":9320,"title":"Definition","data":"Enterprise Performance Management is the process of monitoring performance across the enterprise with the goal of improving business performance. An EPM system integrates and analyzes data from many sources, including e-commerce systems, front- and back-office applications, data warehouses, and external data sources. Advanced EPM systems can support many performance methodologies, such as the balanced scorecard.
","itemType":1,"order":1},{"id":24550,"sectionId":9321,"title":"Definition","data":"Continuous Improvement is the act of making incremental, regular improvements and upgrades to a process or product in the search for excellence.
","itemType":1,"order":1},{"id":24555,"sectionId":9393,"title":"Definition","data":"Project Management is the use of skills and knowledge in coordinating the organizing, planning, scheduling, directing, controlling, monitoring, and evaluating of prescribed activities to ensure that the stated objectives of a project, manufactured good, or service are achieved; aka project.
","itemType":1,"order":1},{"id":24560,"sectionId":9443,"title":"Definition","data":"Inventory Cycle Counting is an inventory accuracy audit technique where inventory is counted on a cyclic schedule rather than once a year. A cycle inventory count is usually taken on a regular, defined basis (often more frequently for high-value or fast-moving items and less frequently for low-value or slow-moving items). Most effective cycle counting systems require the counting of a certain number of items every workday, with each item counted at a prescribed frequency. The key purpose of cycle counting is to identify items in error, thus triggering research, identification, and elimination of the cause of the errors.
","itemType":1,"order":1},{"id":24565,"sectionId":9502,"title":"Definition","data":"Supply Network Planning is the integrated planning of all products of a supply chain at all relevant locations. Supply Network Planning attempts to fulfill all demand by considering all relevant constraints. For fulfillment, Supply Network Planning assigns available inventory, propagates demand to sourcing locations, finds substitute products, and explodes bills of materials (BOMs). Using material requirements planning (MRP) logic, Supply Network Planning creates corresponding orders for supply, such as purchase requests, purchases, transportation orders, or production orders.
Supply Network Planning can consider constraints such as available location inventory; inventory reservations; preferred vendors; preferred production sites; minimum inventory levels; preferred routings; BOMs; and durations for sourcing, production, material handling, and transportation between locations.
In case of shortages, Supply Network Planning can consider priorities between different types of demand, such as more or less important orders from customers, demand from the forecast, or replenishment orders, which maintain minimum inventory levels.
Supply Network Planning is a midterm planning practice. Typical planning horizons cover several weeks or months.
","itemType":1,"order":1},{"id":24570,"sectionId":9383,"title":"Definition","data":"The practice of Perfect Pick Put-Away entails ensuring that items are in the correct quantity, physical location, and condition so that they can be picked accurately when they are ordered.
Here are some best practices for ensuring Perfect Pick Put-Away:
- Check that the items are received from production in the correct quantity and in a saleable condition.
- If necessary, check that the relevant quality management steps have been completed.
- Ensure that the relevant supporting documentation, such as a certificate of analysis, is available.
- Check that the items have been stored in the correct quantity and in the correct storage location or warehouse bin and that all relevant warehouse postings have been confirmed.
Note: Perfect Pick Put-Away helps optimize the downstream pick process for customer delivery. It also can be applied to raw materials, components and work in process to ensure that the materials are ready and in the right location when they are needed.
","itemType":1,"order":1},{"id":24575,"sectionId":9503,"title":"Definition","data":"Days of Supply-Based Material Requirements Planning (MRP) Proposal Management is the practice of reviewing and maintaining material requirements planning proposals by days of supply. It entails understanding demand and the corresponding Make proposals and then monitoring the exceptions. Management by exception, especially when working with production proposals for a select number of stock-keeping units in a vast product range, is key to an efficient planning process.
Typical process steps for this practice include the following:
- Evaluate planned orders for production based on output from MRP, with reference to the oldest demand.
- Validate MRP proposals matching demand so that business rules are satisfied.
- Reschedule where necessary and possible.
- Adjust proposal quantities and dates according to business intelligence from sales and operations planning and other resources.
","itemType":1,"order":1},{"id":24580,"sectionId":9504,"title":"Definition","data":"Work Center Load Evaluation is the practice of identifying bottlenecks in operations and then evaluating the planned loads on these work centers, including work center loading over the optimal time horizon(s), pooled capacities, and work center hierarchies. Record all relevant information for input into balancing processes. Also, consider shift pattern efficiencies, breakdowns, and maintenance shutdowns in the evaluation and planning. Record all relevant information for input into balancing processes.
","itemType":1,"order":1},{"id":24585,"sectionId":9505,"title":"Definition","data":"Balance and Firm within Horizon is the practice of balancing and firming up production activities and available resources in order to best satisfy demand while managing various resources, materials, and other constraints.
Here are some important tips for this practice:
- Manually or automatically schedule material requirements planning (MRP) proposals by date and quantity to optimize the given work center - loads within the agreed firm horizon.
- Delete any proposals that cannot be satisfied within the firm horizon. These proposals can be regenerated outside the firm horizon after the next MRP run.
- Record specific extraordinary items for input into the sales and operations planning plan.
Comments: The assumption is that run times and available capacity are correct.
","itemType":1,"order":1},{"id":24590,"sectionId":9506,"title":"Definition","data":"The Production Plan is the agreed-upon plan that comes from the production planning (sales and operations planning) process—specifically, the overall level of manufacturing output planned to be produced, usually stated as a monthly rate for each product family (group of products, items, options, features, and so on). Various units of measurement (e.g., units, tonnage, standard hours, number of workers) can be used to express the plan. Represents management’s authorization for the master scheduler to convert it into a more detailed plan—that is, the master production schedule: aka: sales and operations planning, sales plan.
","itemType":1,"order":1},{"id":24595,"sectionId":9507,"title":"Definition","data":"Characteristics-Based Forecasting (CBF) is a powerful tool that enables organizations to forecast demand on both the product and the characteristics levels. Configurable products have characteristics, which can take several values. This value assignment is called configuration of a product variant. Although there may be many possible hypothetical combinations, not all of them will be used because some will yield undesirable product variants or products that cannot be produced. In CBF, organizations can produce demand plans for combinations of characteristic values or for individual values. In general, organizations tend to focus on demand for the values that are most relevant to their business plans.
","itemType":1,"order":1},{"id":24600,"sectionId":9444,"title":"Definition","data":"Bill of Material (BOM) Audit and Control is the process that assesses the degree to which a list of specified items conforms to administrative specifications and with correct quantities.
","itemType":1,"order":1},{"id":24605,"sectionId":9384,"title":"Definition","data":"Logistics and Warehouse Planning is the practice of considering the following key points during the Plan process rather than the Transform process: distribution channels, locations, modes of transportation, regulations, required paperwork, duties and taxes, and warehouse capacity.
The Logistics and Warehouse Planning process is a subset of the overall supply chain planning process, which also includes material requirements planning and distribution requirements planning. The inputs to Warehouse and Logistics Planning flow from the overall supply chain plan.
Note: It is important to conduct Logistics and Warehouse Planning as early in the Plan process as possible in order to avoid additional costs. Although many organizations undertake this practice just before the Deliver phase, this is seen as too late in the process.
","itemType":1,"order":1},{"id":24610,"sectionId":9534,"title":"Definition","data":"Supplier Appraisal is the practice of identifying suitable suppliers who can meet the planned requirements. When appraising a supplier, consider the following points:
Buyers can conduct evaluation and appraisal questionnaires, desktop research, field research, supplier visits, reference check, and ask the supplier to fill an RFI to answer questions such as the above.
The 10C’s of Supplier Appraisal Checklist by Carter provides ten capabilities to look at to prequalify suppliers:
-\tCompetency
-\tCapacity
-\tConsistency
-\tControl of process
-\tCost/price
-\tCommitment to Quality
-\tCash/finances
-\tClean
-\tCulture and relationships
-\tCommunications
The importance of supplier appraisal is that it is an essential aspect of both strategic sourcing, supplier management, and the achievement of competitive advantage.
","itemType":1,"order":1},{"id":24615,"sectionId":9394,"title":"Definition","data":"Mobile Access of Information in the supply chain means that information about status, metrics, supply, and demand are available through internet-enabled mobile devices. This requires the integration of the heterogeneous hardware and software components that form the supply chain. The hardware can include smartphones, tablets, laptops, and other mobile and handheld devices. The software includes enterprise resources planning software, various databases, and middleware network programs and protocols.
","itemType":1,"order":1},{"id":24620,"sectionId":9395,"title":"Definition","data":"A Data Warehouse is a repository of data that has been specially prepared to support decision-making applications. Syn: decision-support data.
Business Intelligence is the information collected by an organization on customers, competitors, products or services, and processes.
Business intelligence provides organizational data in such a way that the organizational knowledge filters can easily associate with this data and turn it into information for the organization. Persons involved in business intelligence processes may use application software and other technologies to gather, store, analyze, and provide access to data and present that data in a simple, useful manner. The software aids in business performance management and aims to help consumers make better business decisions by offering them accurate, current, and relevant information. Some businesses use data warehouses because they are a logical collection of information gathered from various operational databases for the purpose of creating business intelligence.
","itemType":1,"order":1},{"id":24625,"sectionId":9535,"title":"Definition","data":"Strategic Sourcing is a comprehensive approach for locating and sourcing key material suppliers, which often includes the business process of analyzing total-spend-for-material spend categories. Includes a focus on the development of long-term relationships with trading partners who can help the purchaser meet profitability and customer satisfaction goals. From an information technology applications perspective, includes automation of requests for quote (RFQ), requests for proposal (RFP), electronic auctioning (e-auction or reverse auction), and contract management processes.
","itemType":1,"order":1},{"id":24630,"sectionId":9536,"title":"Definition","data":"The Purchasing and Procurement Strategy is the purchasing plan for categories (direct, indirect, strategic), families of items (commodities), and long-term risk mitigation to improve supply chain resilience. Includes the plan to manage the supplier base and solve problems.
","itemType":1,"order":1},{"id":24635,"sectionId":9486,"title":"Definition","data":"Pick List Generation is the process of creating a sequential list of all components and materials required to fulfill a specific production, sales, or interplant order, also known as a pick list.
A pick list often specifies the location of each component or material so that warehouse personnel can efficiently locate the items and assemble material for orders. Items typically are ordered by warehouse location so that the picker, which can be a human, robot, drone, or another piece of automated equipment, can go through the warehouse and easily retrieve items for an order. This also sometimes enables warehouse personnel to consolidate picks for more than one order. Items typically are picked into transport bins for each order, packed, and then scheduled for shipment.
A pick list can be as simple as a manually created spreadsheet or a report automatically generated by a warehouse management system.
","itemType":1,"order":1},{"id":24639,"sectionId":9396,"title":"Definition","data":"Customer Data Line of Responsibility is the practice of clearly assigning ownership and accountability for customer data and then periodically reviewing the data quality and accuracy in order to continuously improve the condition of the data and conduct root cause corrective action for any issues or errors. As part of the review, data quality accuracy and other metrics should be tracked to assess performance trends.
","itemType":1,"order":1},{"id":24644,"sectionId":9322,"title":"Definition","data":"Facility Master Planning is a group of business processes that includes the following activities: demand management (which includes forecasting and order servicing); production and resource planning; and master scheduling (which includes the master schedule and the rough-cut capacity plan).
","itemType":1,"order":1},{"id":24649,"sectionId":9476,"title":"Definition","data":"Task Management is a practice used to determine the resources and sequence of tasks for complex delivery processes, including aggregation and staging of products for shipment. Task Management allows the company to forecast manpower, skill set and capital equipment need to comply with committed shipment and delivery dates.
Effective Task Management includes managing all aspects of a task, including its status, priority, time, human and financial resources, recurrences, and notifications.
","itemType":1,"order":1},{"id":24653,"sectionId":9463,"title":"Definition","data":"Predictive Maintenance is a type of preventive maintenance based on nondestructive testing and statistical analysis, used to predict when required maintenance should be scheduled.
","itemType":1,"order":1},{"id":24658,"sectionId":9385,"title":"Definition","data":"Order Management involves the planning, directing, monitoring, and controlling of the processes related to customer orders, manufacturing orders, and purchase orders. Regarding customer orders, order management includes order promising, order entry, order pick, pack and ship, billing, and reconciliation of the customer account. Regarding manufacturing orders, order management includes order release, routing, manufacture, monitoring, and receipt into stores or finished goods inventories. Regarding purchasing orders, order management includes order placement, monitoring, receiving, acceptance, and payment of a supplier.
","itemType":1,"order":1},{"id":24663,"sectionId":9515,"title":"Definition","data":"Return Policy Conformance Integration is the practice of implementing standard procedures and enabling technology to ensure conformance to return policies. Automated policies and supporting processes collect and share important failure and status data with the groups responsible for repair and overhaul, disposal, product life cycle management, component part procurement, and production planning and scheduling.
","itemType":1,"order":1},{"id":24668,"sectionId":9464,"title":"Definition","data":"Carcass Prepositioning is the practice of making disposition decisions for reparable parts, cores, and carcasses early in the return material authorization process. Instructions for those decisions must be included in the authorization provided to the customers responsible for shipping and the internal stakeholders responsible for receiving. Routing decisions also should be included in those instructions. When long lead time, high-demand, or prioritization criteria are applied, items are automatically inducted into the maintenance, repair, and operations process, routing the items to a storage location or disposal.
","itemType":1,"order":1},{"id":24673,"sectionId":9516,"title":"Definition","data":"Product development and engineering groups should be in constant contact and communication with the disposition authority. Product development and engineering teams need to be aware of disposition decisions so that these groups can update technical documentation, the configuration management system, and product specifications as needed.
","itemType":1,"order":1},{"id":24678,"sectionId":9465,"title":"Definition","data":"Electronic Technical Orders and Product Specifications is the practice of using digital methodologies and products to develop technical data for the engineering design, development, and manufacturing of products. This includes the utilization of portable maintenance aids, integrated electronic technical manuals, job performance aids, and other forms of Electronic Technical Orders and Product Specifications to aid in identifying product condition. These tools should tie into the product life cycle management and configuration management systems to ensure that any changes to product or system specifications are utilized in evaluating the product condition.
Such digital methodologies have demonstrated cost savings, process improvements, and increased interoperability.
","itemType":1,"order":1},{"id":24683,"sectionId":9537,"title":"Definition","data":"In Return Shipping Consolidation, authorized returns are routed to the central consolidation hubs or facilities, such as a third-party logistics provider, closest to the customer. The gatekeeping function routes products to the right locations, eliminating the need for sorting at the hub. Consolidated shipments of items that need repair or disposal are transferred to the appropriate location in larger volumes, thus reducing handling, overall processing time, and associated processing and transportation costs.
","itemType":1,"order":1},{"id":24688,"sectionId":9466,"title":"Definition","data":"A Cross-Functional Team is a set of individuals from various departments assigned a specific task, such as implementing new computer software.
","itemType":1,"order":1},{"id":24692,"sectionId":9368,"title":"Definition","data":"Order Quotation System is the practice of receiving, managing, and responding to requests for quotations (RFQs) from customers. The functional group responsible for accepting and managing the RFQs should have the information, systems, and abilities to:
- provide immediate pricing and associated pricing discounts for various quantity breaks (for both similar items and mixed orders, if applicable)
- provide lead-time estimates for all items and order lines, including fulfillment estimates according to the original customer requirements as well as adjusted and negotiated dates, if applicable
- identify and provide alternative quotations based on additional configurations that would provide similar performance at a lower cost
- convert initial or subsequent quotations directly into firm orders.
Typically, an organization's customer service group would manage this practice. However, in the event that a functional group other than the customer service or order management group, such as the commercial pricing group, is responsible for this process element, then the ability to seamlessly move customer quotes between internal functions also is a critical element of this practice.
","itemType":1,"order":1},{"id":24696,"sectionId":9397,"title":"Definition","data":"A Transportation Management System (TMS) is a computer application system designed to manage transportation operations. Typically offer modules focused on specific functions, such as intermodal transportation, import/export management, fleet service management, and load planning and optimization.
","itemType":1,"order":1},{"id":24701,"sectionId":9538,"title":"Definition","data":"Expedited Logistics is the process of accelerating or chasing production, transportation, or purchase orders that are needed in less than the normal lead time; to take extraordinary action because of an increase in relative priority, aka stockchase.
","itemType":1,"order":1},{"id":24706,"sectionId":9481,"title":"Definition","data":"To Embed Specialized Services is the practice of adding additional capability, processes, and expertise on-site by contracting with a third party. By leveraging their existing networks and assets and embedding third-party services, including specialized packaging, product completion, pack out, and other services, into their manufacturing and distribution operations, organizations can add significant capabilities to their supply chains without significant supply chain redesign and reengineering.
","itemType":1,"order":1},{"id":24711,"sectionId":9539,"title":"Definition","data":"Transportation Management Outsourcing is the process of outsourcing the requirements for the execution of planning, scheduling, and budgeting of transportation assets, services, and related systems of the shipping process through delivery.
","itemType":1,"order":1},{"id":24716,"sectionId":9323,"title":"Definition","data":"The Generation of Dynamic BOMs uses an information technology application to dynamically create BOMs based on customer order requirements and specifications as well as product rules. This can be especially useful in Make-to-Order environments so that a company can substitute different raw material types on the fly and create new but similar BOMs for a one-off production requirement.
","itemType":1,"order":1},{"id":24721,"sectionId":9398,"title":"Definition","data":"3-D Printing and Rapid Prototyping is the process of layering materials to make products and components using computer data, aka additive manufacturing.
","itemType":1,"order":1},{"id":24726,"sectionId":9482,"title":"Definition","data":"Digital Packaging on Demand can be used to create custom product packaging unique to the customer and the product requirements. The packaging is digitally printed and cut to a per-order design. This process enables packaging companies to create unique physical and graphic designs in small quantities. The ability to produce short-run on-demand packaging increases efficiency and reduces inventory management, storage and waste.
","itemType":1,"order":1},{"id":24731,"sectionId":9445,"title":"Definition","data":"Vendor-Managed Inventory (VMI) is a means of optimizing supply chain performance in which the supplier has access to the customer’s inventory data and is responsible for maintaining the inventory level required by the customer. Accomplished by a process in which resupply 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 predefined levels. The vendor obtains a receipt for the restocked inventory and accordingly invoices the customer; aka: continuous replenishment.
","itemType":1,"order":1},{"id":24736,"sectionId":9540,"title":"Definition","data":"Return Load Optimization is the practice of combining customer deliveries with pickups for returned items to optimize transportation. In the technology industry, it is common to combine service delivery with the pickup or replacement of defective products at the customer site.
","itemType":1,"order":1},{"id":24741,"sectionId":9541,"title":"Definition","data":"Return Shipment Insurance is the practice of buying insurance for high-value excess inventory return shipments.
","itemType":1,"order":1},{"id":24745,"sectionId":9542,"title":"Definition","data":"Automated supply chain management systems allow for the verification and identification of overshipped products at the time of receipt. Such systems usually automatically compare the received items with the purchase order tolerances. The information about the quantity of excess items can be used to take action based on policies and business rules related to the return process. Depending on company policies and the agreement between the parties involved, overshipped products can be shipped back immediately or sent to a requested return location to continue with the next step in the process.
Note: Overshipments are a receiving issue against purchase order requirements.
","itemType":1,"order":1},{"id":24750,"sectionId":9543,"title":"Definition","data":"Collaboration between supply chain partners can be facilitated using a Supply Chain Control Tower. This allows the supplier to see requirements and inventory levels at the customer’s site, highlighting any potential excess inventory. Similarly, the customer can easily identify supply and demand variations and take the necessary actions to return excess inventory, if needed.
","itemType":1,"order":1},{"id":24755,"sectionId":9544,"title":"Definition","data":"Automated Alerts for Material Management is the practice of using web-based or email alerts containing enterprise resources planning insights to inform key supply chain partners about inventory levels and projected demand for key materials, as well as supply-demand imbalances. Predetermined thresholds, which typically are analyzed in terms of days of supply, need to be identified and agreed upon. Automated alerts can then notify decision-makers when inventory reaches upper and lower thresholds until action is taken to correct the supply-demand imbalance.
","itemType":1,"order":1},{"id":24760,"sectionId":9545,"title":"Definition","data":"Return Cost Recovery is the practice of recovering the cost of materials and the incremental costs of returning the item to the supplier of the failing component and repairing the item. When a defective product is returned by a customer, an analysis to identify the source of the problem usually takes place. If the defect is determined to be related to a component purchased from a vendor, the process of recovering part or all of the cost from the vendor is typically called Return Cost Recovery. Further collaboration with the vendor to prevent similar issues in the future, or to improve quality, can also be considered.
Note: A prerequisite for this practice is a written agreement with affected suppliers that includes details related to the warrantable conditions, excluded items, the period of warranty coverage, when such period commences, and the extent to which some or all the buyer’s associated direct and indirect costs are reimbursed by the supplier.
","itemType":1,"order":1},{"id":24765,"sectionId":9546,"title":"Definition","data":"Return Policy Included with Shipping Document - In order to better facilitate the return process and provide additional information about agreed-upon return policies, it is common practice to include the return policy with the shipping documentation. This clearly identifies terms and conditions and explains what kind of action should be taken in case of a return.
Note: This practice probably is best suited for the shipment of a product intended for end customers and not for a component being shipped to an original equipment manufacturer. Return policies now are more often kept on supplier websites and referenced in the documentation provided.
","itemType":1,"order":1},{"id":24770,"sectionId":9446,"title":"Definition","data":"The Identification of Obsolete Capital Assets is the process of identifying physical assets that are held by an organization for its production potential and that are no longer usable or have zero value.
","itemType":1,"order":1},{"id":24774,"sectionId":9547,"title":"Definition","data":"A Request for Information (RFI) is an inquiry to a potential supplier about that supplier’s product or service for potential use in the business. The inquiry can provide certain business requirements or be of a more general exploratory nature, aka request for proposal (RFP).
","itemType":1,"order":1},{"id":24779,"sectionId":9548,"title":"Definition","data":"A Request for Quote (RFQ) is a document used to solicit vendor responses when a product has been selected and price quotations are needed from several vendors.
","itemType":1,"order":1},{"id":24784,"sectionId":9467,"title":"Definition","data":"Total Preventive Maintenance Programs encompass continuing efforts to adapt, modify, and refine equipment to increase flexibility, reduce material handling, and promote continuous flows. It is operator-oriented maintenance with the involvement of all qualified employees in all maintenance activities, aka total preventive maintenance.
","itemType":1,"order":1},{"id":24789,"sectionId":9549,"title":"Definition","data":"Supplier Evaluation is the practice of evaluating a new or existing supplier. A thorough supplier evaluation process will consider pricing, technical quality, supplier structure and sustainability, capability and capacity, fit with the purchasing company, level of service, performance history, location, and acceptable contract terms and conditions. It is prudent to be as objective as possible in the evaluation. Weighting can be given to certain evaluation criteria, such as price, quality, performance, or location, based on their importance to the purchaser.
An evaluation committee should jointly agree on the overall evaluation score. Members of the committee should include key stakeholders, purchasers, and individuals who may not have a direct interest in the outcome but who are able to ask probing questions and challenge the norm.
This task should not be confused with evaluation of supplier materials.
","itemType":1,"order":1},{"id":24794,"sectionId":9550,"title":"Definition","data":"The Return Authorization process in which the last known holder or the designated return center receives a return authorization request from a customer determines if the item can be accepted, and communicates the decision to the customer. Requests from the customer can be made for reasons of defect, excess, recall, etc. Accepting the request includes negotiating the conditions of the return with the customer, including authorizing replacement or credit. Rejecting the request includes providing a reason for the rejection to the customer.
","itemType":1,"order":1},{"id":24799,"sectionId":9607,"title":"Definition","data":"Outsourcing the supply chain dedicated to the reverse flow of products and materials for the purpose of returns, repair, remanufacture, and/or recycling.
","itemType":1,"order":1},{"id":24804,"sectionId":9608,"title":"Definition","data":"Carcass Disassembly refers to the disassembling of a non-serviceable item obtained from a customer that is intended for use in remanufacturing.
","itemType":1,"order":1},{"id":24809,"sectionId":9324,"title":"Definition","data":"Theory of Constraints (TOC) is a holistic management philosophy developed by Dr. Eliyahu M. Goldratt, based on the principle that complex systems exhibit inherent simplicity. Even a very complex system comprising thousands of people and pieces of equipment can have, at any given time, only a very, very small number of variables—perhaps only one, known as a constraint— that actually limit the ability to generate more of the system’s goal.
","itemType":1,"order":1},{"id":24814,"sectionId":9551,"title":"Definition","data":"Pre-issued Return Authorization is the practice in which a return authorization number is issued at the time of ordering or shipment of the goods to the customer. The proactive issuance of a return authorization number reduces the time, cost, and possible errors associated with the process to receive and validate a return authorization request and issuing the authorization. This practice also requires the policy that an item cannot be returned without a return authorization number.
Note: The customer does not need to make a request for a return authorization number, as the supplier is providing the number by default or proactively based on a certain logic. For example, some companies and retailers include a digital return authorization and return shipping label in case the consumer wants to return the item. The consumer simply has to access the information in his or her online account.
","itemType":1,"order":1},{"id":24819,"sectionId":9552,"title":"Definition","data":"Preventive Returns is the practice of issuing notices to consumers and customers requesting the return of goods or materials due to possible product defects or damage. This includes notifying distributors, intermediaries or channel partners that may hold these goods for resale purposes. The purpose of preventive returns is to protect the brand, reduce operational disruptions for customers, avoid injuries to customers or consumers, and reduce associated costs.
Examples of preventive returns include recalls in the automotive, electronics, and food industries.
Note: This practice may, in certain cases, be required by law. Not all preventive returns are required by law, though. The severity of the defect or damage and the risk strategy of the company may determine whether or not to execute this practice.
","itemType":1,"order":1},{"id":24824,"sectionId":9447,"title":"Definition","data":"Purchase Order Management is the management of a purchaser’s authorization used to formalize a purchase transaction with a supplier. A purchase order, when given to a supplier, should contain statements of the name, part number, quantity, description, and price of the goods or services ordered; agreed-to terms as to payment, discounts, date of performance, and transportation; and all other agreements pertinent to the purchase and its execution by the supplier.
","itemType":1,"order":1},{"id":24829,"sectionId":9448,"title":"Definition","data":"Supplier Collaboration is the practice of issuing a 12-month rolling picture of demand to the supplier. The schedule usually includes a fixed window of time in which no changes should be made, a flexible window where it is acceptable to increase or decrease quantities or adjust delivery times, and a forecast window that gives the supplier an idea of future plans. The schedules are reviewed regularly, often on a monthly basis. This collaboration may enable suppliers to provide a higher level of service at a lower cost.
In situations where Supplier Collaboration is being used, there usually is a formal contract between the supplier and the customer that includes the agreed-upon prices, specifications, and delivery volumes. With this aspect handled, the strategic purchasing team can focus on the commercial points, and the operational purchaser can focus on managing the order requirements and demands of production. These are two very different skill sets, but they are equally important here.
The expectation is that lead times become reduced as suppliers can plan resources with fewer surprises. This practice often is used in industries that have regular purchases of products. It is especially beneficial to industries that must manage variation and changes.
Note: The 12-month timeline may vary by organization.
","itemType":1,"order":1},{"id":24834,"sectionId":9449,"title":"Definition","data":"Cross-Docking is the concept of packing products on incoming shipments so they can be easily sorted at intermediate warehouses or for outgoing shipments based on the final destination. The items are carried from the incoming vehicle docking point to the outgoing vehicle docking point without being stored in inventory at the warehouse. Cross-docking reduces inventory investment and storage space requirements. aka direct loading.
","itemType":1,"order":1},{"id":24839,"sectionId":9450,"title":"Definition","data":"Receiving Goods Inspection is the practice of inspecting goods upon receipt for any delivery discrepancies such as damage, incorrect quantity compared with a purchase order or delivery paperwork, and incomplete or incorrect paperwork. In some cases, receiving personnel should test samples of some materials to ensure accuracy. If any check shows a discrepancy, the goods may be quarantined or rejected following the returns process. The returns process will need to ensure that the vendor provides credit for goods returned.
","itemType":1,"order":1},{"id":24844,"sectionId":9399,"title":"Definition","data":"3-Way Delivery Verification is the practice of comparing the information on purchase orders, receipts, and invoices to ensure that the correct items were received and invoiced.
","itemType":1,"order":1},{"id":24849,"sectionId":9553,"title":"Definition","data":"The Supply Chain Risk Management (SCRM) Strategy Implementation and Analysis is the strategic implementation of the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities.
","itemType":1,"order":1},{"id":24854,"sectionId":9554,"title":"Definition","data":"The Supply Chain Risk Register is a report that has summary information on qualitative risk analysis, quantitative risk analysis, and risk response planning. This register contains all identified risks and associated details.
A risk register captures all of the risk exposure for a supply chain once the risks are identified and assessed in terms of impact and probability of occurrence. While developing this register, organizations often name major risk groups, including operational, technical, financial, legal, brand, environmental, and safety and health risks. Then they identify specific supply chain risks within the groups and capture the impact of these specific risks on their respective key risk groups.
A risk matrix is then developed by plotting the probability of occurrence on one axis and impact on the other. For each supply chain risk identified, risk management professionals should plot it on the matrix. This will help the risk management team arrive at a risk rating for each risk and accurately prioritize the risk.
The following is an example of identifying risks, assessing them, and categorizing them into a risk register. The cost impact magnitudes, probability breakdowns, and category assignments can be adjusted based on a company’s size and risk complexity.
| ID | PROCESS | RISK IDENTIFICATION (EVENT) | RISK ASSESSMENT | CATEGORY | ||
| Probability | Impact | VAR | ||||
| 1 | Source | Plastic strip supplier shut down by labor strike | 10% | 5000 | 500 | Cat 5 |
| 2 | Plan | Out-of-stock incidences with the distributors | 25% | 1000 | 250 | Cat 5 |
| 3 | Transform | Packing equipment failure | 85% | 13000 | 11050 | Cat 3 |
| 4 | Fulfill | Increased delivery costs due to high price of fuel | 95.5% | 10000 | 9550 | Cat 2 |
| Total Risk Magnitude (Value at Risk (VAR)) | 21350 |
Risk Categories
| RISK PRIORITIES | RISK CATEGORY | COLOR |
| Priority 1 | Category 1 | Red |
| Priority 2 | Category 2 | Orange |
| Priority 3 | Category 3 | Blue |
| Priority 4 | Category 4 | Purple |
| Priority 5 | Category 5 | Green |
| Risk Category | Millions of U.S. Dollars | |||||
| Cat 4 | Cat 2 | Cat 2 | Cat 1 | Cat 1 | > 500 | Cost Impact |
| Cat 4 | Cat 3 | Cat 2 | Cat 2 | Cat 1 | 100-500 | |
| Cat 5 | Cat 4 | Cat 3 | Cat 2 | Cat 2 | 50-100 | |
| Cat 5 | Cat 4 | Cat 3 | Cat 3 | Cat 2 | 10-50 | |
| Cat 5 | Cat 5 | Cat 4 | Cat 3 | Cat 3 | 5-10 | |
| Cat 5 | Cat 5 | Cat 5 | Cat 5 | Cat 5 | 0.5-5 | |
| Very Low | Low | Moderate | High | Very High | Probability | |
Real-Time Package Tracking is the practice of using technology to track the movement and location of packages in real time. A radio frequency identification tag or machine-to-machine antenna is attached to the package or asset, which allows the owner, seller, or buyer to track the item via GPS, cellular phone, or other networks.
Tracking information also can include current trajectory, travel history, vehicle speed, package temperature, and level of light exposure. Alerts may be established to notify customers or owners of various changes to package conditions, including high or low temperatures, as well as when a package has been picked up, is in transit, or has been successfully delivered.
Trackers can be placed in each package, sporadically throughout a related shipment, or within courier satchels and vehicles. Self-powered GPS trackers are useful. When GPS signals are unavailable, tracking devices should automatically default to a cellular network and relay their positions through the closest cell tower.
","itemType":1,"order":1},{"id":24862,"sectionId":9326,"title":"Definition","data":"Automated Data Capture (ADC) is the use of technologies that collects data about objects and then sends the data to a computer without human intervention. Examples include radio frequency wireless devices and terminals, bar code scanners, and smart cards.
","itemType":1,"order":1},{"id":24867,"sectionId":9400,"title":"Definition","data":"Radio Frequency Identification (RFID) is a system that uses electronic tags to store data about items. Accessing or retrieving this data is accomplished through a specific radio frequency and does not require close proximity or line-of-sight access, aka active tag, passive tag, or semi-passive tag.
","itemType":1,"order":1},{"id":24872,"sectionId":9327,"title":"Definition","data":"Standard Operating Procedures is the practice of creating, using, and following a written document or instruction guide that details all of the steps and activities of a process or procedure. A standard operating procedure (SOP) provides employees with a reference for completing common business practices, activities, or tasks. New employees use an SOP to answer their questions without having to interrupt supervisors to ask how an operation is performed.
Well-documented SOPs help ensure consistency in process execution and provide an effective tool for documenting process steps and their sequence, business rules, best practices, and exception handling, as well as who is responsible for each step.
The international quality standard ISO 9001 essentially requires the determination and documentation of processes used in any manufacturing process that could affect the quality of the product. Standard Operating Procedures can support this.
Note: The U.S. military sometimes uses the phrase standing operating procedure instead. This type of document refers to a unit’s unique procedures, which may not be standard across all units. Therefore, the description standard is confusing in this case.
","itemType":1,"order":1},{"id":24877,"sectionId":9487,"title":"Definition","data":"Collaborative Planning, Forecasting, and Replenishment (CPFR) is a collaborative process whereby supply chain trading partners can jointly plan key supply chain activities from production and delivery of raw materials to production and delivery of final products to end customers. Collaboration encompasses business planning, sales forecasting, and all operations required to replenish raw materials and finished goods. 2) A process philosophy for facilitating collaborative communications. CPFR is considered a standard and is endorsed by the Voluntary Interindustry Commerce Standards, aka collaborative planning.
","itemType":1,"order":1},{"id":24882,"sectionId":9468,"title":"Definition","data":"Just-in-Time (JIT) Production is a philosophy of manufacturing based on the planned elimination of all waste and on continuous improvement of productivity. It encompasses the successful execution of all manufacturing activities required to produce a final product, from design engineering to delivery, and includes all stages of conversion from raw material onward. The primary elements of just in time are to have only the required inventory when needed; to improve quality to zero defects; to reduce lead times by reducing setup times, queue lengths, and lot sizes; to incrementally revise the operations themselves, and to accomplish these activities at minimum cost. In the broad sense, it applies to all forms of manufacturing—job shop, process, and repetitive—and to many service industries as well, aka short-cycle manufacturing, stockless production, zero inventories.
","itemType":1,"order":1},{"id":24886,"sectionId":9555,"title":"Definition","data":"A goods receipt from a production environment where products can be and usually are finished before receipt of a customer order. Customer orders are typically filled from existing stocks, and production orders are used to replenish those stocks, aka produce-to-stock, assemble-to-order, make-to-order.
","itemType":1,"order":1},{"id":24891,"sectionId":9401,"title":"Definition","data":"Electronic Data Interchange (EDI) is the paperless (electronic) exchange of trading documents, such as purchase orders, shipment authorizations, advanced shipment notices, and invoices, using standardized document formats.
","itemType":1,"order":1},{"id":24896,"sectionId":9328,"title":"Definition","data":"Lean is a philosophy of production that emphasizes the minimization of the amount of all the resources (including time) used in the various activities of the enterprise. It involves identifying and eliminating non-value-adding activities in design, production, supply chain management, and dealing with customers. Lean producers employ teams of multiskilled workers at all levels of the organization and use highly flexible, increasingly automated machines to produce volumes of products in potentially enormous variety. Lean production contains a set of principles and practices to reduce cost through the relentless removal of waste and through the simplification of all manufacturing and support processes, aka lean, lean manufacturing.
","itemType":1,"order":1},{"id":24901,"sectionId":9329,"title":"Definition","data":"Spend Analysis is a purchasing activity in which a firm explores its spending patterns to identify opportunities to reduce costs or improve quality. Part of value analysis as well as cost-benefit analysis.
","itemType":1,"order":1},{"id":24906,"sectionId":9508,"title":"Definition","data":"Long-Term Supplier Agreement or Partnership is the practice of using long-term agreements to replace multiple purchase orders for repetitive or recurring orders. More complex agreements involve a longer-term strategic partnership that includes the sharing of knowledge as well as supplier involvement in early product development.
These agreements can vary from very informal for very formal, such as those bound by strict legal contracts. In addition, the agreements can be between a buyer and a simple supplier of a commodity or between a buyer and a partner in the value chain.
The practice aims at achieving total quality management across the value chain.
","itemType":1,"order":1},{"id":24911,"sectionId":9556,"title":"Definition","data":"Supply Base Rationalization is the practice of analyzing the number of suppliers an organization uses to determine if it is the optimum number. One of the measures of purchasing performance is average purchasing volume per supplier. The buying company needs to strike a balance between the number of suppliers for a material or product and the buying company’s negotiating power. Increasing the number of suppliers used can enhance competition and drive down prices. At the same time, using too many suppliers could also have negative effects. For example, each supplier may provide a smaller amount of items or materials, which could exempt the buyer from receiving quantity-based discounts. In addition, managing multiple suppliers creates more work for purchasing managers.
A spend analysis is a very good starting point for creating a guideline for the optimum number of suppliers.
","itemType":1,"order":1},{"id":24916,"sectionId":9451,"title":"Definition","data":"Consignment Inventory Management is a technique to manage inventories, generally of finished goods, that are in the possession of customers, dealers, agents, brokers, etc., but remain the property of the manufacturer by agreement with those in possession, aka consignment inventory, vendor-owned inventory, consignment.
","itemType":1,"order":1},{"id":24921,"sectionId":9330,"title":"Definition","data":"Lean Six Sigma is a methodology that combines the improvement concepts of lean and six sigma. It uses the seven wastes of lean and the DMAIC process from six sigma, and awards recognition of competence through judo-style belts. Leveraging SCOR as part of the method helps organizations develop larger, more impactful improvement portfolios.
","itemType":1,"order":1},{"id":24926,"sectionId":9402,"title":"Definition","data":"Document Management System is the practice of using of a computer system or set of programs to track and store electronic documents or images of paper documents. Document management systems generally are capable of keeping track of different versions created by different users for the purposes of version control and tracking changes. Document management systems are considered a component of enterprise content management systems and are related to digital asset management, document imaging, workflow systems and records management systems.
Document Management System eliminates the need for managing paper versions of documents as well as the challenges of archiving and document retention. In addition, document management systems allow multiple people to access the documents, sometimes at the same time, which is not typically possible with paper documents.
","itemType":1,"order":1},{"id":24930,"sectionId":9331,"title":"Definition","data":"Electronic Returns Tracking is the practice of using electronic systems to track the locations of returns within the supply chain. This practice enables shorter turn-around times for returns, repairs and replacements. Visibility of in-transit items also can help recipients identify and plan for shipping delays.
This practice can involve different types of technology, including bar coding and radio frequency identification. Regardless of the type of technology used, an information technology system must be set up to track item locations as they are scanned and display this information to supply chain analysts.
More sophisticated systems can be set up to do automated analysis of information to immediately identify potential issues. An example may be reviewing transfer cycle times to see if they fall within a certain time limit. If the metric falls outside the desired range, the system could notify a supply chain analyst to resolve the issue. Setting up business rules and notifications within a tracking system helps to automate the return process and reduce required manpower.
","itemType":1,"order":1},{"id":24935,"sectionId":9369,"title":"Definition","data":"Rotable Spares Pool is the use of an inventory of serviceable parts that can replace a customer’s broken part to help minimize customer downtime. This is especially useful for items that tend to have long lead times.
However, a challenge with this strategy is ensuring that the parts in the rotable spares pool are a form, fit and function replacement for any items that a customer could bring in for exchange. There also is a risk that parts in the rotable spares pool could become obsolete, which yields high costs for the company. Therefore, this practice is best used for high-demand items with long lead times, such as structural items that frequently break and need repair.
","itemType":1,"order":1},{"id":24940,"sectionId":9517,"title":"Definition","data":"Beyond Economic Repair (BER) Management is the practice of assessing items as they are removed for Maintenance, Repair and Overhaul (MRO) to determine whether repairing the items would cost more than buying replacements. Determining this before shipping an item for repair can reduce transportation costs. Any salvageable components should be taken off an item before scrapping it, so that these components can be used as additional repair parts.
The identification process may require test equipment and other assessment tools or personnel at the site where the BER assessment is being made. Depots are a likely location for this practice to take place because of the availability of tools and personnel.
","itemType":1,"order":1},{"id":24945,"sectionId":9469,"title":"Definition","data":"Mixed Mode or Reverse Material Issue is a practice that helps accurately track raw material levels before and after-production. It is most useful on production lines where the amount of raw material needed tends to vary based on different parameters.
This defers from the back flush concept, in which a system automatically issues the same amount of raw material each time a product is manufactured. For example, assume that a widget requires two units of raw material. Once one widget is manufactured, two more units of raw material are released so that the next widget can be made. The drawback of this system is that there is no real-time visibility of the raw materials in the whole process. The accuracy of the inventory count also is dependent on the theoretical assumption that two units of raw material are required to make one widget.
However, in Mixed Mode or Reverse Material Issue, an automated system or human operator checks the amount of leftover raw material after each item is produced and then returns the leftover raw material to inventory. So, for example, if only 1.8 units of raw material are required to make a widget, the leftover 0.2 units could be returned to inventory, rather than scrapped or lost in the process. Similarly, if 2.2 units are needed, then the operator or automated system can adjust the raw materials inventory record to note that 0.2 fewer units are available for future production. The advantage of this system is that there is an accurate count of the amount of raw material in inventory at any given time.
","itemType":1,"order":1},{"id":24950,"sectionId":9470,"title":"Definition","data":"Production Scheduling Optimization Using Technology is a process of developing the production schedule using smart technologies that employ advanced algorithms, machine learning, and AI
","itemType":1,"order":1},{"id":24954,"sectionId":9557,"title":"Definition","data":"Supply Chain Risk Monitoring is the practice of establishing a formal process to continuously monitor the changes in probability or impact of risk events.
Once areas of risk have been identified, an organization needs to monitor its internal and external environment. Risk monitoring helps companies:
- predict when risky events are becoming more likely
- identify new risks
- continuously assess the effectiveness of a Supply Chain Risk Management (SCRM) program.
Real-time metrics and periodic reports provide decision-makers with knowledge about upcoming risks:
- Statistical analysis of key metrics can reveal trends.
- Visibility into supplier and customer metrics increases the ability to monitor the whole supply chain.
- Reports about risk monitoring can be combined with existing management reviews and meetings.
- Monitoring also can include monitoring qualitative sources of information, such as news or weather reports, to identify events that are precursors to risks.
It is important to monitor indicators that would appear early in a risk event or, if possible, before the risk occurs. If monitoring only reveals a risk well after its first occurrence, it likely will be too late to adequately respond to it.
Monitoring also can be used to test the effectiveness 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 any signs of the risk occurring. The effectiveness of the SCRM program can be assessed by monitoring three general aspects, namely
1. the risk exposure present in the supply chain.
2. the portion of risk actively mitigated.
3. the ability to respond and adapt to risk events.
","itemType":1,"order":1},{"id":24959,"sectionId":9610,"title":"Definition","data":"Supply Chain Risk Assessment provides management with an understanding of where the greatest risks may exist. This helps company leaders prioritize resources for risk mitigation and management. Performing such assessments will involve clarifying the nature of a 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 typically is made up of two measures: probability and impact:
Probability measures the likelihood that a supply chain–interrupting event will occur. In formal probability, a probability of 0 means the event will never occur, and a probability of 1 means the event will surely occur. The exact probability may be difficult to determine unless historical data exist that can be used to find the frequency of the risk event. Alternatively, an organization can use a subjective probability, or degree of belief, based on the opinions of experts. A time horizon is necessary to define the probability in a useful way, for example, the likelihood that an event will occur in the next year or in the next 50 years.
Impact measures the consequences of risk event on the organization. It can be measured directly, for example, in terms of monetary impact, or on a scale, for example on a scale of zero to one with zero being very little negative consequence, 0.5 being a medium amount of consequence, and one being a very severe consequence. Methods for measuring impact include what-if simulations, financial models and the opinions of teams of experts. Impact may also be measured in terms of other SCOR metrics besides financials.
A summary risk score can be calculated for each risk by multiplying the impact times the probability to get an expected value for the risk. Then, risks can be ranked by risk score. Also, the risks can be shown on a map or graph.
Additive Manufacturing is the process of layering materials to make products and components using computer data, aka additive manufacturing See: BP.120 3D Printing and Rapid Prototyping.
","itemType":1,"order":1},{"id":24969,"sectionId":9558,"title":"Definition","data":"A Blockchain is a continuously growing list of records, called blocks, are linked, and secured using cryptography. Each block typically contains a cryptographic hash of the previous block, a timestamp, and transaction data. The data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, inherently making it resistant to modification, aka cryptocurrency.
","itemType":1,"order":1},{"id":24974,"sectionId":9509,"title":"Definition","data":"Demand-Driven Material Requirements Planning (DDMRP) is a method for planning material needs that enables a company to build more closely to actual market requirements.
","itemType":1,"order":1},{"id":24978,"sectionId":9510,"title":"Definition","data":"Demand-Driven Sales and Operations Planning (DDS&OP) is a bidirectional integration point in a demand-driven adaptive system between the strategic (annual, quarterly, and monthly) and tactical (hourly, daily, and weekly) relevant ranges of decision-making. DDS&OP sets the key parameters of a demand-driven operating model based on business strategy, market intelligence, and key business objectives, including strategic information and requirements. DDS&OP also projects model performance based on the strategic information and requirements and various model settings. In addition, DDS&OP uses variance analysis based on past model performance in terms of reliability, stability, and velocity to adapt the key parameters of a demand-driven operating model and even recommend strategic alterations to the model and project their respective impacts on the business.
","itemType":1,"order":1},{"id":24982,"sectionId":9332,"title":"Definition","data":"A Digital Supply Chain encompasses the process of delivering digital media, such as music or video files, by electronic means from the point of origin at the content provider to the destination with the consumer. Similar to how a physical item must go through a supply chain process in order to mature from components to a consumable product, digital media must pass through various stages in processing before it can be enjoyed by a consumer via a smartphone, tablet, computer, television or another device.
A broader definition of the term digital supply chain is the use of digital technology and content to improve supply chain performance. Part of this refined definition recognizes that traditional supply chains configured to distribute physical goods or services can be enhanced via technology — such as computers and other connected devices, the internet of things, and related sensors — and digital content. For example, real-time monitoring of equipment can allow companies to proactively schedule maintenance or replace parts. Similarly, real-time inventory tracking can enable proactive reordering of materials, components, or products. Companies also can provide enhanced user support for a physical item through digital content, such as videos demonstrating how to use or troubleshoot a product. Digital supply chains are enabled by the internet of things, cloud-based computing, big data, and advanced analytics, among other technologies.
","itemType":1,"order":1},{"id":24987,"sectionId":9472,"title":"Definition","data":"The Internet of Things (IOT) is an environment in which objects, animals, or people are provided with unique identifiers and the ability to transfer data over a network without requiring human-to-human or human-to-computer interaction. This allows objects to be sensed and controlled remotely across existing network infrastructure, creating opportunities for more direct integration between the physical world and computer-based systems.
","itemType":1,"order":1},{"id":24992,"sectionId":9511,"title":"Definition","data":"Integrated Business Planning (IBP) is a business process and capability that seeks to maximize company profitability by creating an enterprise-wide operating plan. The process drives decision-making across all aspects of the business by balancing customer demand, supply, and company resources. The integrated business plan is generated at the level of detail needed for all participating business functions to execute the activities required to achieve the plan. This is typically at an aggregate planning level with the ability to disaggregate to a more detailed level.
IBP is a mid-term planning process that focuses on month two and beyond, extending out past the fiscal year typically to 18 months. (Timeframes vary depending on the industry sector.) The goal of the IBP process is to develop consensus on a single business plan that aligns with the strategy, tactics, and execution plans; organization and functional accountabilities; and any risk management plans.
The IBP process is owned by the executive or senior management team and is cross-functional in nature. Distinct to IBP is the appropriate integration, involvement, and commitment of functions or areas such as product management, finance, new product introduction, product marketing, engineering, service and support, sales, demand planning and forecasting, operations and manufacturing, and sourcing and procurement. An IBP process typically builds upon the foundation of an established Sales and Operations Planning (S&OP) (BP.021) process with continuous review meetings in each functional area.
IBP is unique from S&OP because it also includes other advanced practices, including Scenario Planning (BP.184) and Supply Chain Risk Management (SCRM) (BP.001)
","itemType":1,"order":1},{"id":24997,"sectionId":9512,"title":"Definition","data":"Scenario Planning is a planning process that identifies critical events before they occur and uses this knowledge to determine effective alternatives.
","itemType":1,"order":1},{"id":25002,"sectionId":9333,"title":"Definition","data":"The Cost of Quality Measurement represents the overall costs associated with prevention activities and the improvement of quality throughout the firm before, during, and after the production of a product. These costs fall into four recognized categories: internal failure costs, external failure costs, appraisal costs, and prevention costs. Internal failure costs relate to problems before the product reaches the customer. These usually include rework, scrap, downgrades, reinspection, retest, and process losses. External failure costs relate to problems found after the product reaches the customer. These usually include such costs as warranty and returns. Appraisal costs are associated with the formal evaluation and audit of quality in the firm. Typical costs include inspection, quality audits, testing, calibration, and checking time. Prevention costs are those caused by improvement activities that focus on reducing failure and appraisal costs. Typical costs include education, quality training, and supplier certification, aka cost of poor quality.
","itemType":1,"order":1},{"id":25007,"sectionId":9334,"title":"Definition","data":"Supply Chain Finance is a technology-based set of processes that link the buyer, seller, and financing institution to lower financing costs and improved business efficiency. Specifically, Supply Chain Finance provides short-term credit to the buyer, and the seller then optimizes that working capital. Technology is used to automate transactions and track invoice approval and the settlement process.
The purpose of Supply Chain Financing is to increase value; mitigate risk; and improve financial performance through collaborative relationships that plan, steer, control, and manage the supply and demand of financial resources in the supply network.
Supply Chain Finance has relevance and impact across individual businesses (micro level), total supply chains (meso level), and the national and global economy (macro level).
","itemType":1,"order":1},{"id":25012,"sectionId":9488,"title":"Definition","data":"Supply Chain Management Object Synchronization (3- or 4-Way Match) provides the ability to follow an object through its entire life cycle across a supply chain is a foundational element in creating visibility and gaining supply chain control. The focuses of Supply Chain Management Object Synchronization are to create object synchronization from sales to cash and to enable systems integration and digitalization.
The method to describe the object linkages within the object synchronization is often referred to as a 3- or 4-Way Match.
","itemType":1,"order":1},{"id":25017,"sectionId":9370,"title":"Definition","data":"Augmented Reality is the practice of integrating augmented reality (AR) technology into current processes to boost efficiency and automation. AR technology blurs the line between the physical and digital worlds. AR devices juxtapose holograms over a physical environment to provide additional information or guidance. Using AR in supply chain management can help make warehouse operations more efficient, speed up production, reduce machine downtime, minimize in-house costs and achieve shorter sales processes, thus boosting worker engagement and enhancing overall productivity.
Picking, for example, can be improved drastically by using AR. The operator can wear AR-enabled smart glasses to see information about the locations of items as well as instructions about what items and quantities to pick, all overlaid on his or her current field of vision. This allows employees to work in a heads-up manner, rather than having to constantly refer to pick sheets, which in turn enables faster cycle times to fulfill orders and a more efficient workforce without the expense of pick-to-light hardware.
","itemType":1,"order":1},{"id":25022,"sectionId":9335,"title":"Definition","data":"Robotic Process Automation is a technology that replaces activities (processes) previously performed by humans with mechanical devices or data-oriented robots that can either be operated by humans or run by computers. Difficult to do, dangerous, or monotonous tasks are likely candidates for robots to perform.
","itemType":1,"order":1},{"id":25027,"sectionId":9336,"title":"Definition","data":"Artificial Intelligence refers to computer programs (algorithms) that can learn and reason in a manner similar to humans. The problem is defined in terms of states and operators to generate a search space that is examined for the best solution. In contrast, conventional programming collects and processes data by algorithm or fixed step-by-step procedures.
","itemType":1,"order":1},{"id":25032,"sectionId":9403,"title":"Definition","data":"Big Data Analytics is the process of collecting, storing, and processing massive amounts of data for the purpose of converting it into useful information.
","itemType":1,"order":1},{"id":25037,"sectionId":9473,"title":"Definition","data":"Should Cost Modeling is an analytical approach that determines what a product should cost based on estimated costs for raw materials, labor, and production overhead as well as the profit margin. This practice essentially requires a customer to adopt the mindset of the supplier and estimate costs that typically are incurred by a supplier but are later rolled into an item price. Advanced, bottom-up should cost models provide insights into cost drivers, which are an important enabler for identifying cost reduction opportunities. These models can then be used during the bidding process in requests for proposals or requests for quotes, which typically results in better prices for low-spend items. Supplier-agreed cost models also can be used to enable longer-term supplier agreements, especially for product categories in which new products are frequently introduced during the contract duration.
Should Cost Modeling optimizes product and process design, which often are the drivers of cost; helps product development teams estimate the product cost at an early stage to achieve their targeted costs’ and provides the sourcing team with key information for judicious price negotiation. Should Cost Modeling also builds an understanding of the cost structure and enables companies to identify savings opportunities. In addition, it can help to identify the major cost drivers for a given item and compare them across supplier cost categories.
","itemType":1,"order":1},{"id":25042,"sectionId":9452,"title":"Definition","data":"Predictive Analytics is a method of extracting information from existing data to determine patterns and predict future outcomes and trends. It does not predict with 100 percent accuracy, but it does predict unknown future events with a high level of reliability.
Predictive Analytics uses historical and current data as data sets to forecast future opportunities and risks. It also uses many different techniques like data mining, text analytics, statistics, modeling, artificial intelligence, and machine learning and applies them to structured and unstructured data sets to create predictive models that are then used to predict the likelihood of a particular event happening in the future. Predictive models capture relationships among many factors in a data set to assess the conditions and place a numerical value, called a score, on the likeliness of a particular future opportunity, risk, or event happening.
Predictive Analytics allows organizations to become more proactive and forward-looking and anticipate outcomes and behaviors based on data rather than hunches or assumptions. For example, retailers could use Predictive Analytics based on their own customer analytics to make more informed decisions about what types of products to stock. In addition, sensors on manufacturing machinery can collect data to help Predictive Analytics determine when maintenance and repair work should be done or when the machinery will stop working.
","itemType":1,"order":1},{"id":25047,"sectionId":9518,"title":"Definition","data":"Digital Twin is the practice of making an exact virtual replica or model of a process, product, or service to digitally simulate, test, model and monitor the operations of a real-world object.
Although a digital twin can be created before the physical product is built, the virtual counterparts of physical assets typically are created using sensors on the physical objects. Data should be collected and synthesized from various sources, including physical data, manufacturing data, operational data, and data from other analytics software. This data, along with artificial intelligence and machine-learning algorithms, is integrated into a virtual model. As more data is collected and synthesized, the digital model becomes a better representation of the physical item, thus allowing operators to monitor and test equipment without being near or utilizing the item. In addition, real-time access to data can help companies better analyze situations and predict and identify problems before they escalate.
This practice is especially suited for the manufacturing and automobile industries. Digital twins can play a significant role in the way products are designed, manufactured, and maintained, which in turn increases the efficiency of and optimizes the process while also reducing throughput. In the automobile industry, an automaker can make a digital twin of a car to capture its behavioral and operational data and analyze its overall performance.
","itemType":1,"order":1},{"id":25052,"sectionId":9559,"title":"Definition","data":"Smart Contracts involve the use of self-executing contracts to write the terms of an agreement between a buyer and a seller into lines of blockchain code and then use this technology to automatically ensure that the contract terms are met. If a new action, transaction, or other information is added to the blockchain, or decentralized digital ledger, of the agreement, the information will be rejected if it does not match the terms of the agreement already included in the blockchain, thus ensuring that all parties adhere to the contract.
This practice is especially useful in supporting trustworthy transactions between or among anonymous parties. Transactions made via smart contracts and blockchains are traceable, transparent, and irreversible.
The best way to describe a smart contract is to compare it to a vending machine. When making a purchase from a vending machine, the purchaser inserts payment and enters the number associated with the item he or she wants to buy. The vending machine then validates the request by checking the availability of the requested item and the amount of money inserted. If the validation is successful, the vending machine dispenses the item. Otherwise, it rejects the transaction and returns the money. There is no need for a middleman, such as a human cashier, in this transaction.
Many organizations across industries can benefit from Smart Contracts. For example, automated billing processes can reduce overbilling and prevent fraudulent billing. In turn, this also increases the speed of communication and transactions because the process is automated and transparent. Plus, because the contracts are self-monitoring, humans are not needed to oversee the contracts as meticulously as with regular contracts, thus freeing up personnel to handle other value-added tasks.
","itemType":1,"order":1},{"id":25057,"sectionId":9404,"title":"Definition","data":"Advanced Data Visualization and Visibility is the practice of rendering complex data in a visual context so that people can understand the data better. Patterns and correlations that might go undetected in text-based data can be exposed and recognized when they are rendered visually using advanced data visualization techniques. To support a dynamic business environment with constantly flowing data streams, advanced data visualization tools also provide a more dynamic representation of data, displaying the information in sophisticated infographics, 3D geographic maps, heat maps, dials and gauges, multi-dimensional views, animations, and more. These images might include interactive capabilities as well, enabling users to manipulate them or mine data out of them to further analyze the situation.
A common Advanced Data Visualization and Visibility strategy is to generate a dashboard of automatically updating charts and graphics that help the organization track its performance over time and across different sectors.
","itemType":1,"order":1},{"id":25062,"sectionId":9453,"title":"Definition","data":"Real-Time Location System is the use of real-time location systems (RTLS) to automatically identify and track the location of objects or people in real time. Tracked items or people are equipped with wireless RTLS tags that send wireless signals to fixed reference points to help the system determine the specific tag’s location. The system can be used to locate pallets of merchandise in a warehouse or find a specific bag in a retail store, for example. However, the locating capability typically is limited to the area equipped with receivers for the RTLS tag signals.
RTLS is different from GPS in that most RTLS utilize radio frequency communication and built-in electrical chips. In addition, RTLS is more interested in location than speed.
The retail industry can particularly benefit from this practice. For example, a clothing retailer can implant a chip into every hanger. Then, the system can track which items are still on the rack, have been picked up by a customer, have been brought to the fitting room, or have been returned to the rack. This can enable a store employee to help a customer quickly find a specific shirt in a specific size, for example, or receive customer feedback about how well an item tends to fit, based on how often the item is taken to the fitting room and then returned to the rack, without asking customers.
","itemType":1,"order":1},{"id":25067,"sectionId":9386,"title":"Definition","data":"Autonomous Delivery is the practice of using robots that travel over land or through the air to deliver parcels. On-road autonomous vehicles can automatically collect packages, mail, or even food orders and deliver them to locations in urban areas. By comparison, drones and other air-based autonomous vehicles are better suited for suburban and rural deliveries. The advantages of this practice are that it frees up humans to handle other value-added tasks and that it helps organizations expand their same-day delivery capabilities, which could give them an advantage over competitors.
","itemType":1,"order":1},{"id":25072,"sectionId":9454,"title":"Definition","data":"Stocktaking by Drones is the practice of using drones to count the stock or inventory in a given location. Drones are increasingly being used in warehouses to count stock by scanning bar codes or radio frequency identification tags or by using a computer vision system. The stock information then is relayed directly to the warehouse management system. Stocktaking drones may be fully autonomous, navigating through a warehouse using non-GPS systems such as lasers, 4G, or Wi-Fi for positioning, or they may be tethered to a forklift or autonomous warehouse vehicle and constantly monitor and record stock while the vehicle operates. Stocktaking drones also can operate outside of warehouses in open yards and storage areas using differential GPS and preprogrammed routes.
Stocktaking drones can operate 24/7 and provide high stock accuracy with minimum disruption to operations. In addition, stocktaking drones can increase safety by preventing humans from having to climb ladders to count stock that is stored in high locations.
","itemType":1,"order":1},{"id":25077,"sectionId":9455,"title":"Definition","data":"Dynamic Inventory Management is the branch of business management concerned with planning and controlling inventories at all levels, horizons, and time fences.
","itemType":1,"order":1},{"id":25082,"sectionId":9456,"title":"Definition","data":"A Quick Response (QR) Code is a unique, item-level code that can be added to a product. The QR code can carry product information and be used for inventory management, track and trace, authentication at the point of sale to help discern authentic items from counterfeit products, verifying warranties, and more.
","itemType":1,"order":1},{"id":25087,"sectionId":9387,"title":"Definition","data":"Mobile Distribution Center is the practice of setting up movable storage tankers, mobile warehouses, or other mobile facilities that can quickly be installed in a building and positioned close to the customer to improve responsiveness and customer satisfaction. This practice may optimize a distribution network that deals with high demand and unexpected variability. The distribution designs of organizations that use this practice are not restricted by the location of the current infrastructure. Instead, the organizations can dynamically adjust their distribution locations to accommodate demand.
","itemType":1,"order":1},{"id":25092,"sectionId":9337,"title":"Definition","data":"Machine Learning is the practice of using artificial intelligence that is capable of analysis, self-training, and observation to assist with planning and forecasting and also improve its own performance. Artificial intelligence systems can collect data, receive instructions, or observe examples and direct experiences and then identify patterns in the information. This analysis forms the basis of the technology’s knowledge, thus helping it to become smarter and more capable, and can help the system make decisions in the future. The primary aim is to allow the computers to learn automatically without human intervention or assistance and adjust actions accordingly.
Note: Although this practice primarily is used for planning and forecasting, this technology can be mapped to almost any process.
","itemType":1,"order":1},{"id":25097,"sectionId":9388,"title":"Definition","data":"Dynamic Routing provides real-time information management detailing the method of manufacture of a particular item. It includes the operations to be performed, their sequence, the various work centers involved, and the standards for setup and run. In some companies, the routing also includes information on tooling, operator skill levels, inspection operations, testing requirements, and so on, aka bill of operations, instruction sheet, manufacturing data sheet, operation chart, operation list, operation sheet, route sheet, routing sheet, bill of labor, bill of resources. In information systems, the process of defining the path a message will take from one computer to another computer.
","itemType":1,"order":1},{"id":25102,"sectionId":9371,"title":"Definition","data":"Virtual Reality is the process of using interactive, computer-generated experiences(hardware and software) that take place within a simulated, apparently real environment for the purposes of training personnel or handling dangerous jobs remotely. Virtual reality (VR) technology mainly incorporates auditory and visual feedback, but some systems include haptic feedback as well. This helps with completing tasks or experiencing a realistic training simulation.
Current VR technology most commonly uses VR headsets or multi-projected environments, sometimes in combination with physical environments or props, to generate realistic images, sounds, and other sensations that simulate a user's physical presence in a virtual or imaginary environment.
","itemType":1,"order":1},{"id":25107,"sectionId":9338,"title":"Definition","data":"A Multi-Enterprise Business Network (MEBN) is a commerce network or platform that facilitates the exchange of information or transactions among disparate parties within the scope of supply chain processes, including finance and settlement. A MEBN, in conjunction with multi-enterprise business applications, is sometimes referred to as a multi-enterprise supply chain business network (MESCBN). Regardless of the name, the best networks combine trading partner networks and advanced applications with intelligence to support all aspects of supply chain processes and functionality across the enterprise and with stakeholder groups and interested parties.
The best MEBNs usually:
- are cloud-based
- have near-infinite connectivity, which means that the number of players and connections always are increasing as new trading partners are added
- have a focus on data security and governance to ensure privacy and security
- have an integration-first approach, meaning that they connect multiple enterprises, systems, organizations, and users through a single sign-on
- are data- and process-centric
- are an enabler of business intelligence and analytics because they provide cross-enterprise and end-to-end intelligence
- have a focus on collaboration, allowing multi-party collaboration on and negotiation of all aspects of the supply chain, including demand, supply, production, and delivery.
It is important to note that many MEBNs were originally designed for the transportation field to support in-transit visibility. More mature networks now offer a wide variety of functions and applications in order to plan and execute a fully optimized end-to-end supply chain. Applications may include forecasting, order collaboration, inventory visibility and optimization, packing requirements, shipment and transit visibility, capacity collaboration or reservation, risk mitigation, quality assessment and control, finance including settlement, and workforce management.
","itemType":1,"order":1},{"id":25112,"sectionId":9489,"title":"Definition","data":"Crowdsourced Delivery is a fulfillment practice that leverages networks of local, non-professional couriers to deliver packages to customers' doors. Crowdsourced delivery attempts to skirt the bottlenecks of last-mile delivery by tasking someone local to both the package’s origin and customers' door to expedite fulfillment and elevate customer satisfaction.
","itemType":1,"order":1},{"id":25117,"sectionId":9613,"title":"Definition","data":"Telematics is a method of monitoring cars, trucks, equipment, and other assets by using GPS technology and on-board diagnostics (OBD) to plot the asset’s movements on a computerized map. Also known as fleet tracking or GPS vehicle tracking, telematics is now an essential management tool for fleet management.
","itemType":1,"order":1},{"id":25121,"sectionId":9560,"title":"Definition","data":"Fleet management is an essential operation for the efficient functioning of logistics operations from the first mile to the last mile, and it involves ensuring that the overall costs of transportation, fleet, and resource utilization, and regulatory compliance of a fleet are at their optimal. Effective fleet management through utilization of telematics, fleet tracking, messaging and alerting, arrival times predictions, dashboard provisioning, and carrier integration enables supply chain visibility and lets all relevant stakeholders know where shipments are at all times and in real-time.
","itemType":1,"order":1},{"id":25126,"sectionId":9339,"title":"Definition","data":"A Smart Factory is an interconnected network of machines, communication mechanisms, and computing power, the smart factory is a cyber-physical system that uses advanced technologies such as artificial intelligence (AI) and machine learning to analyze data, drive automated processes, and learn as it goes. A smart factory provides real-time operational insight and intelligence across the supply chain to improve tactical and strategic operations and gain a competitive advantage. It is comprised of the following three attributes:
Service Configuration Management is a formal procedure to identify and document the characteristics of a product, service, or project, control changes, and support an audit to verify conformance.
","itemType":1,"order":1},{"id":25135,"sectionId":9340,"title":"Definition","data":"A Service Level Management document represents the terms of performance for organic support.
","itemType":1,"order":1},{"id":25140,"sectionId":9341,"title":"Definition","data":"Service Change Management is the business process that coordinates and monitors all changes to the business processes, services and applications operated by the business, as well as to its internal equipment, resources, operating systems, and procedures. The change management discipline is carried out in a way that minimizes the risk of problems that will affect the operating environment and service delivery to the users.
","itemType":1,"order":1},{"id":25144,"sectionId":9490,"title":"Definition","data":"Service Incident Management is the practice of managing the resolution of unplanned events that disrupt or can disrupt the service and involves recording, prioritizing, updating, and closing incidents.
","itemType":1,"order":1},{"id":25149,"sectionId":9342,"title":"Definition","data":"Service Request Management is the practice of managing the fulfillment of service requests and includes recording, prioritizing, fulfilling, updating, and closing service requests.
","itemType":1,"order":1},{"id":25154,"sectionId":9372,"title":"Definition","data":"Service Availability Management is the practice of ensuring that services meet the current and future availability needs of the business in a cost-effective and timely manner. Availability management defines, analyzed, plans, measures, and improves all aspects of the availability of services and ensures that all infrastructures, processes, tools, and roles are appropriate for the agreed service level targets.
","itemType":1,"order":1},{"id":25159,"sectionId":9373,"title":"Definition","data":"Service Capacity Management is the function of establishing, measuring, monitoring, and adjusting limits or levels of capacity in order to execute all transformation activities (i.e., the service plan, production plan, master production schedule, material requirements plan, and dispatch list). Capacity management is executed at four levels: resource requirements planning, rough-cut capacity planning, capacity requirements planning, and input/output control.
","itemType":1,"order":1},{"id":25164,"sectionId":9374,"title":"Definition","data":"Service Continuity Management is part of the overall management system that establishes, implements, operates, monitors, reviews, maintains, and improves an organization’s capability of delivering products or services at acceptable predefined levels following a disruptive incident. It is based on identifying potential threats to an organization and the impact on business operations from those threats. The system provides a framework for building organizational resilience with the capability of an effective response that safeguards the interests of its key stakeholders, reputation, brand, and value-creating activities.
","itemType":1,"order":1},{"id":25169,"sectionId":9343,"title":"Definition","data":"Service Knowledge Management Systems is an integrated approach (system) used by organizations to capture, share, develop, and use organizational knowledge. This information is used to produce products, interface with customers, and navigate through competitive markets more effectively.
","itemType":1,"order":1},{"id":25174,"sectionId":9478,"title":"Definition","data":"Service Validation and Testing Management is the practice of validating and testing new or changed services. Service validation and testing ensure that the service matches its design specification and will meet the needs of the business.
","itemType":1,"order":1},{"id":25179,"sectionId":9344,"title":"Definition","data":"Service Valuation Management is the practice of measuring the total cost of delivering a service and the total value to the business of that service. Service valuation is used to help the business and the service provider agree on the value of the service.
","itemType":1,"order":1},{"id":25184,"sectionId":9345,"title":"Definition","data":"Service Design Management is the practice of designing services, governing practices, processes, and policies required to realize the service provider’s strategy and to facilitate the introduction of services into supported environments. Service design management includes design coordination, service catalog management, service level management, capacity management, continuity management, information security management, and supplier management.
","itemType":1,"order":1},{"id":25189,"sectionId":9493,"title":"Definition","data":"Service Transition Management is the practice of ensuring that new, modified, or retired services meet the expectation of the business as documented in the service strategy and service design stages of the lifecycle. Service transition management includes transition planning and support, change management, service asset and configuration management, release and deployment management, service validation and testing, change evaluation, and knowledge management.
","itemType":1,"order":1},{"id":25194,"sectionId":9519,"title":"Definition","data":"Service Problem Management is the practice of managing the lifecycle of all service problems. Service problem management proactively prevents incidents from happening and minimizes the impact of incidents that cannot be prevented.
","itemType":1,"order":1},{"id":25199,"sectionId":9346,"title":"Definition","data":"Continual Service Improvement ensures that services are aligned with changing business needs by identifying and implementing improvements to services that support business processes. The performance of the service provider is continually measured, and improvements are made to processes, services, and infrastructure in order to increase efficiency, effectiveness, and cost-effectiveness.
","itemType":1,"order":1},{"id":25204,"sectionId":9347,"title":"Definition","data":"Dynamic Case Management is handling case-related work using technologies that automate and streamline aspects of each case. In this context, a case is a collection of information about a particular instance of something, such as a person, company, incident, or problem. It is the ability to have exceptions to the rule that enables smart decisions faster when handling ad-hoc workloads.
","itemType":1,"order":1},{"id":25208,"sectionId":9348,"title":"Definition","data":"A Business Rules Management System (BRMS) utilizes Rules engines that are tools that support the identification, definition, rationalization, and quality of business and technology rules. Rules engines also provide a repository that allows rules to be checked against one another or definition or context problems and thus checked for redundancy and definition quality. In practice, rules are looked at as if-then statements: if (an event or value), then do something. Various classes of business rules include mandatory constraint, guideline, action enabler, computation, and inference.
","itemType":1,"order":1},{"id":25213,"sectionId":9561,"title":"Definition","data":"Green Procurement is a technique used by a supply chain that considers environmental impacts on its operations and takes action along the supply chain to comply with environmental safety regulations and communicate this to customers and partners is considered a green supply chain.
Green procurement extends to the green supply chain aspect to consider the supplier selection criteria based on environmental standards, prequalifying suppliers based on environmental practices, auditing suppliers based on green practices, and drafting specifications with environmental aspects on it.
Usually, green and ethical procurement is an extension of the company strategy; organizations recently had been committing to the SDG's \"Sustainable development goals' which cascaded to the procurement function.
","itemType":1,"order":1},{"id":25218,"sectionId":9562,"title":"Definition","data":"Ethical Procurement is the practice of incorporating ethical standards into the procurement process. 'Ethics' in procurement relates to a wide range of issues from supplier business procedures and practices to corruption. The common areas relate to ethics and ethical behavior in companies include fair trade, ethical trading, ethical sourcing, social accountability, social auditing, corporate social responsibility, corporate citizenship, codes of conduct, and reputation assurance.
There are three general rules of ethical behavior:
(1) buyers must act in the interests of their organization rather than personal enrichment and should not accept outside gifts or favors that violate their firm's ethics policy.
(2) buyers must act ethically toward suppliers or potential suppliers by treating them professionally and with respect.
(3) buyers must uphold ethical standards set out for their profession, which are often formalized in the form of a code of conduct or statement communicated to employees and suppliers.
Ethical purchasing and compliance of suppliers to labor and environmental regulations have become particularly important for global organizations considering a number of recent scandals that have impacted many global companies violating human rights.
Activities in ethical procurement would include:
-\tMap suppliers, and identify strategic suppliers.
-\tIdentify specific high risks in the supply chain, such as ethical violations.
-\tConduct an initial analysis of working conditions in the supply chain: this can be done through supplier visits and questionnaires.
-\tConsult with local and international experts.
-\tConstruct an ethical sourcing policy and identify for which issues it can take responsibility.
-\tissue a public statement of intent/code of conduct that will help suppliers and the general public to understand your position.
-\tBegin implementing the policy.
","itemType":1,"order":1},{"id":25223,"sectionId":9563,"title":"Definition","data":"Early Supplier Involvement is the process of involving suppliers early in the product design activity and drawing on their expertise, insights, and knowledge to generate better designs in less time and designs that are easier to manufacture with high quality. See: participative design/engineering.
","itemType":1,"order":1},{"id":25228,"sectionId":9564,"title":"Definition","data":"In-Country Value is a sustainable practice that aims to boost economic performance and support local industries by redirecting higher portions of spending into the national economy. This means that in the solicitation process, a local supplier will be given preference over international suppliers by assigning weight \"Varies\" to local suppliers in the comparison and awarding process. This does not necessarily mean awarding local suppliers always but rather emphasizing the empowerment of national suppliers. This practice helps the strategic localization of supply chains and the development of new local industries and services, Creating valuable job opportunities in the private sector & National GDP Growth.
","itemType":1,"order":1},{"id":25233,"sectionId":9565,"title":"Definition","data":"Negotiations Planning is the practice of thoroughly preparing for negotiation with suppliers in advance, including research, knowing the objectives, understanding the concessions, and having a BATNA. It also includes:
Contract Drafting is the process where upon setting specifications and building a business case, the procurement team will determine the contract particulars and what needs to be included in the contract for this specific procurement process.
Such as what type of payment is needed and what incoterm is preferred, delivery time, and other factors set in the specification drafting.
Usually, this happens with stakeholders in mind and prior to supplier selection or sourcing the market
","itemType":1,"order":1},{"id":25243,"sectionId":9567,"title":"Definition","data":"A Framework Agreement is the practice of making an agreement with suppliers, a framework agreement is a general term for agreements with suppliers which sets out terms and conditions under which specific purchases (call-offs) can be made throughout the term of the agreement.
This framework agreement may, itself, be a contract to which procurement rules apply. This would be the case where the agreement places an obligation, in writing, to purchase goods, works, or services.
It does not mean actual prices should be fixed, but rather that there should be a mechanism that will be applied to pricing particular requirements during the period of the framework. It should also be possible to establish the scope and types of goods and/or services that will need to be called off. There should not be any objection to upgrading the product or service required so long as it remains within the scope of the original specification.
Upon determining the need to procure, Procurement can create direct call-off or mini competition between the suppliers that had the framework agreement signed. Procurement also can buy the same goods/service from outside the framework agreement suppliers if deemed appropriate.
","itemType":1,"order":1},{"id":25248,"sectionId":9568,"title":"Definition","data":"Supply Market Research is the practice of conducting supply market research enables procurement to understand how the supply market works, the direction in which the market is going, the competitiveness, and the key suppliers within the supply market.
The results of this analysis can help the buyer to improve and shape the strategy and tendering process and align their behavior in order to achieve better value for money, reduced prices, or improved service.
Effective procurement requires researching the supply markets and the competitive factors that affect these markets. Tools like Porter's five forces model and STEEPLE analysis can come in handy.
Porter’s five forces analysis can provide a useful framework for understanding these issues:
1. degree of competition
2. threat of new entrants
3. threat of substitute products and services.
4. the power of buyers
5. the power of suppliers
STEEPLED Analysis is a strategic planning methodology that can be used across all business functions to discover, evaluate, organize, and track external risk. It is an acronym, the individual letters standing for: Social, Technological, Economic, Environmental, Political, Legislative, Ethical, and Demographic.
Use STEEPLED analysis to identify the potential influence or disruption that the following macro (External) factors can have on your organization's activities, and having awareness of possible external disruptions, enables the organization to take a proactive approach and re-align elements or activities of their supply chain to enable them to continue to meet their business objectives.
","itemType":1,"order":1},{"id":25253,"sectionId":9569,"title":"Definition","data":"Specification Development is the practice of specifying and documenting the business requirements for supply, specification is a systematic statement of the requirements to be satisfied in the supply of a product or service and sits at the heart of the contract between the buyer and the seller. A specification is developed to define the business requirements clearly and communicate these to suppliers effectively to facilitate the evaluation of goods and services against the agreed specification. An effective specification provides evidence of what is agreed upon and removes any doubt, ambiguity, or misunderstanding as to what is required.
Developing a detailed specification can be a timely and costly exercise, and there is a need to engage the necessary stakeholders and main users of the product or service to ensure an effective specification is created. During the specification development process, procurement must take steps to ensure the product is not being over-specified and the agreed tolerances are achievable so as not to add cost to the product and leave the organization exposed to too many restrictions on supply.
The implications of not developing an effective specification can be misunderstandings with key stakeholders and with the supplier over the requirements. This exposes the business requirement to interpretation or being over-specified or even inferior goods being delivered with defects or inconsistent quality.
An effective specification is clear, concise, comprehensive, compliant, and current to ensure there is no ambiguity with regard to the business requirements.
As stakeholders play an important part in effective specification development, the Stakeholder Management Matrix helps procurement to identify the key stakeholders to engage in the communication loop and development of the specification. The Early Supplier Involvement (ESI) Matrix helps procurement to establish how best to engage suppliers in the development process and the appropriate time relative to specific developments. Working in collaboration with suppliers in developing the specification and utilizing their expertise can often help to reduce the lead time and improve the quality.
","itemType":1,"order":1},{"id":25258,"sectionId":9570,"title":"Definition","data":"A Blanket Agreement is the practice of signing a long-term commitment, most often annually, with a supplier of material/service against which short-term releases will be generated to satisfy requirements. Often blanket orders cover only one item. Blanket orders are indefinite by their nature, which means the dates of delivery and quantity notices from suppliers might not be fixed or known. Requirements are “based on demand.” Procurement would forecast the total demand needed and create a blanket agreement for that amount.
The payment progress is negotiable between parties in the blanket order, this means it might be based on individual deliveries or predetermined, like advanced payment or deferred payment.
","itemType":1,"order":1},{"id":25263,"sectionId":9571,"title":"Definition","data":"Sustainable Specification Development is the practice of specifying and documenting the business requirements for supply using sustainable standards, A sustainable specification is developed to define the ethical and environmental business requirements clearly and communicate these to suppliers effectively to facilitate the evaluation of goods and services against the agreed specification.
Such specification would be a reflection of the organization's commitment to creating a sustainable business from an ethical and environmental standpoint. An example of such specification is the use of Eco-friendly products, the reduction of emissions, the use of recycled material, energy-efficient products, the acquisition of 14001 ISO standards
","itemType":1,"order":1},{"id":25268,"sectionId":9572,"title":"Definition","data":"A Supplier Certification Program manages the certification procedures verifying that a supplier operates, maintains, improves, and documents effective procedures that relate to the customer’s requirements. Such requirements can include cost, quality, delivery, flexibility, maintenance, safety, and ISO quality and environmental standards.
","itemType":1,"order":1},{"id":25273,"sectionId":9573,"title":"Definition","data":"A Sustainable Procurement Strategy is a process whereby organizations meet their needs for goods, services, works, and utilities in a way that achieves value for money on a whole-life basis in terms of generating benefits not only to the organization but also to society and the economy, whilst minimizing damage to the environment.
To successfully take this into action, procurement should align the organization's sustainability strategy with the procurement strategy by:
1. Adopting a sustainable procurement strategy by establishing the role of procurement professionals and buyers, adopting the standards or targets showing what will and will not be bought, and agreeing on the techniques to be used.
2. Challenging the current culture within the company.
3. Publishing the sustainable procurement policy as a clear commitment to action and ensure that senior figures visibly pursue this policy and demonstrate their commitment to real action and change.
4. Developing a dialogue with suppliers: discuss with suppliers the possibility of a more sustainable version of current purchases.
Assurance of strategy implantation is instrumental and can be achieved through:
A Multi-Tier Supplier Audit is the practice of officially inspecting Suppliers' tiers by the buying organization or an independent third party to ensure compliance with requirements and standards.
Buyers can use questionnaires to gather information on suppliers' attitudes to ethical concerns and sustainable practices. Also, can be done by visiting supplier premises to judge if those multi-tiers of suppliers are adhering to sustainable practices. Usually, these audits are investigative by their nature, where buying organization seeks to find evidence of violations of human rights, for example.
Can be carried out by also interviewing employees of these suppliers, tour at the supplier workplace, face to face at the supplier's premises, and a structured series of questions that touch base with the contract signed to guarantee adherence.
Where possible, these visits and audits should be unannounced to prevent any sort of preparation at the place, such as cleaning, hazard removal, imposing safety, or the creation of new documentation.
","itemType":1,"order":1},{"id":25283,"sectionId":9575,"title":"Definition","data":"An Approved Vendor List is a list of parties that have been approved by a company as its suppliers. This list usually is based on product quality and the financial stability of the vendor.
","itemType":1,"order":1},{"id":25288,"sectionId":9576,"title":"Definition","data":"A Supplier Credit Check is a practice of researching whether the supplier is financially stable, one way to do this is to carry out a credit check with a credit rating agency. They collect information about suppliers from various resources and produce a score that reflects the financial stability of the supplier. A supplier with a low credit rating would impose risk on the buying organization. Procurement uses the credit check practice to understand supplier financial solvency and bankruptcy risk.
Alternatively, the procurement department can internally calculate supplier solvency using measures like Altman Z Score, Gearing Ratios, Liquidity & profitability ratios of the suppliers using their financial statements.
The practice is instrumental to help In prequalifying suppliers and preparing an approved supplier list.
","itemType":1,"order":1},{"id":25293,"sectionId":9577,"title":"Definition","data":"In marketing, Category Management provides an organizational structure for managers responsible for planning and implementing marketing systems for certain product lines.
","itemType":1,"order":1},{"id":25298,"sectionId":9578,"title":"Definition","data":"Specification Value Analysis is the systematic use of techniques that identify a required function, establish a value for that function, and provides that function at the lowest overall cost. Focuses on the functions of an item rather than the methods of producing the present product design.
","itemType":1,"order":1},{"id":25303,"sectionId":9579,"title":"Definition","data":"Specification Value Engineering is a disciplined approach to the elimination of waste from products or processes through an investigative process that focuses on the functions to be performed and whether such functions add value to the good or service.
","itemType":1,"order":1},{"id":25308,"sectionId":9580,"title":"Definition","data":"A Make Or Buy Analysis is a comparison of all the costs associated with making an item versus the cost of buying the item.
","itemType":1,"order":1},{"id":25313,"sectionId":9581,"title":"Definition","data":"Outsourcing is the process of having suppliers provide goods and services that were previously provided internally. Outsourcing involves substitution—the replacement of internal capacity and production by that of the supplier. See: subcontracting.
","itemType":1,"order":1},{"id":25318,"sectionId":9582,"title":"Definition","data":"Open Tendering is the practice of widely advertising a tender to be available for any supplier to make a bid, which can be through journals, websites, mass communication, social media, or e-procurement portals.
In some instances, suppliers must express their interest to obtain the ITT \"Invitation to tender.\"
Tendering Process should avoid conflict of interest and should be run in an ethical and sustainable way, with formalized arrangement should be in place, A best practice of tender arrangement can look like below:
-Determine Approach
-Time Scale
-Advertising
-Documentation
-Submission
-Analysis
-Decision
-Verification
-Negotiation
-Contract Preparation
-Contract Awarded
-Notification
-Feedback
-Debrief
","itemType":1,"order":1},{"id":25323,"sectionId":9583,"title":"Definition","data":"Restricted Tendering is the practice of restricting advertising a tender to be available for a few suppliers to make a bid, which can be through inviting suppliers from the existing database or from the approved supplier's list or prequalified suppliers.
In some instances, suppliers must express their interest to obtain the ITT \"Invitation to tender\"
The Tendring process should avoid conflict of interest, should be run in an ethical and sustainable way, and a formalized arrangement should be in place.
A best practice of tender arrangement can look like below:
-Determine Approach
-Time Scale
-Documentation
-Submission
-Analysis
-Decision
-Verification
-Negotiation
-Contract Preparation
-Contract Awarded
-Notification
-Feedback
-Debrief
","itemType":1,"order":1},{"id":25328,"sectionId":9584,"title":"Definition","data":"A Reverse Auction is an internet auction in which suppliers attempt to underbid their competitors. Company identities are known only by the buyer.
","itemType":1,"order":1},{"id":25333,"sectionId":9585,"title":"Definition","data":"Spot Buying is a purchase made on a one-time basis for standard off-the-shelf material or equipment.
","itemType":1,"order":1},{"id":25338,"sectionId":9586,"title":"Definition","data":"Trade Exchanges are the practice of using web-based marketplaces \"Platforms\" to procure goods and services, Trade exchanges are either hosted by third parties or hosted by the buying organization to facilitate a collaborative procurement process with upstream partners.
The goal is to streamline the procurement process and responsiveness through improved procurement process visibility and collaboration, advanced integration platforms, and customization capabilities.
As an increasing number of companies embed digital strategies from the top down, B2B Marketplaces are becoming a familiar component within the procurement toolkit.
Trade exchanges offer a range of capabilities that connects sellers with buyers, for example, wholesale companies and end customers. A third-party marketplace offers users an interface to the supplier’s product catalogs and may additionally support payment, logistics, or ordering.
","itemType":1,"order":1},{"id":25343,"sectionId":9587,"title":"Definition","data":"E-catalog management is the practice that enables buying organizations to procure goods/services electronically via the electronic product content (e-catalog) made available by suppliers. The product content can be hosted by either the supplier or the buyer.
This web-based technology provides information on products and services offered and sold by a vendor, Supports online ordering and payment capabilities. Key elements of a catalog are product names, product hierarchy, descriptions, prices, and supplier and internal codes.
E-catalogs are predominantly used for procuring frequently replenished indirect goods and services but may also provide purchasing guidelines to facilitate complicated procurements.
","itemType":1,"order":1},{"id":25348,"sectionId":9457,"title":"Definition","data":"A Continuous Replenishment Program is a process by which a supplier is notified daily of actual sales or warehouse shipments and commits to replenishing these sales (for example, by size or color) without stockouts and without receiving replenishment orders. The result is a lowering of associated costs and an improvement in inventory turnover. See: rapid replenishment, vendor-managed inventory.
","itemType":1,"order":1},{"id":25353,"sectionId":9588,"title":"Definition","data":"A Total Cost of Ownership (TCO) Analysis is the analysis of the total cost of ownership of the supply delivery system is the sum of all the costs associated with every activity of the supply stream. The main insight that TCO offers to the supply chain manager is the understanding that the acquisition cost is often a very small portion of the total cost of ownership.
","itemType":1,"order":1},{"id":25358,"sectionId":9589,"title":"Definition","data":"A Price Analysis is the examination of a seller’s price proposal or bid by comparison with price benchmarks, without examination and evaluation of all of the separate elements of the cost and profit making up the price in the bid.
","itemType":1,"order":1},{"id":25363,"sectionId":9590,"title":"Definition","data":"A Purchase Price Cost Analysis is the practice of analyzing the cost of the individual materials, components, and activities that make up a purchased item.
Purchase price cost analysis is one way to analyze prices offered by the supplier with the purpose of understanding how the price sums up with cost elements, this helps the buyers better negotiate with their suppliers.
It also helps answer key questions such as
-\tIs the price paid for goods and services reasonable?
-\tWhich costs are necessary and legitimate?
-\tAre there any cost additions or allowances for contingencies in the pricing that is not necessary?
-\tAre the resulting profits for the supplier reasonable or excessive?
","itemType":1,"order":1},{"id":25368,"sectionId":9591,"title":"Definition","data":"Supplier Debriefing is the practice of informing suppliers about the status of the tender awarding and whether they were awarded or not, Supplier debriefings are an integral part of a transparent and equitable procurement process which permits unsuccessful suppliers in an open call for bids an opportunity to understand why their bid was not successful.
Debriefing is a way of helping suppliers to improve their competitive performance which produces benefits to procuring organizations.
","itemType":1,"order":1},{"id":25373,"sectionId":9592,"title":"Definition","data":"MEAT Awarding (Most Economically Advantageous Tender) is the practice of evaluating and awarding suppliers where procurement takes account of criteria that reflect qualitative, technical, and sustainable aspects of the tender submission as well as price when reaching an award decision.
Most Economically Advantageous Tender means the Tender offer that is most economically advantageous regarding the subject matter of the contract, such as quality, price, technical merit, aesthetic and functional characteristics, environmental characteristics, running costs, cost-effectiveness, after-sales service, technical assistance, delivery date and delivery period or period of completion and other matters.
The relative weighting of each criterion used to assess the submissions must be determined with scoring to reach an awarding decision.
","itemType":1,"order":1},{"id":25378,"sectionId":9593,"title":"Definition","data":"A Solicitation Process is a practice used by procurement to communicate procurement requirements and request bids, quotations, or proposals from potential suppliers. Solicitations may take different forms such as Request for Quotation (RFQ), Invitation to Bid (ITB), or Request for Proposal (RFP).
","itemType":1,"order":1},{"id":25383,"sectionId":9594,"title":"Definition","data":"A Purchase Price arrangement is a practice of determining the appropriate cost/price contracting mechanism that governs price & cost changes during the life of the contract.
Depending on the nature of work and type of goods/services procured, Procurement would consider the appropriate purchase price arrangements.
There are many arrangements that can be considered upon contracting such as:
-\tFirm Fixed-price
-\tFixed price with economic Adjustment
-\tCost plus fixed fee
-\tCost reimbursement
-\tCost plus %
Each one of them imposes a different degree of risks on the buying organizations, for example, A Firm Fixed-price has the lowest risk as it prevents changes to the original price contracted no matter what changes take place in the cost structure at the supplier side.
","itemType":1,"order":1},{"id":25388,"sectionId":9595,"title":"Definition","data":"Progress Payments are payments arranged in connection with purchase transactions requiring periodic payments in advance of delivery for certain amounts or for certain percentages of the purchase price.
","itemType":1,"order":1},{"id":25392,"sectionId":9596,"title":"Definition","data":"Single Sourcing is a method whereby a purchased part is supplied by only one supplier. Traditional manufacturers usually have at least two suppliers for each component part they purchase to ensure continuity of supply and (more so) to foster price competition between the suppliers. A JIT manufacturer frequently has only one supplier for a purchased part so close relationships can be established with a smaller number of suppliers. These close relationships (and mutual interdependence) foster high quality, reliability, short lead times, and cooperative action. Ant: multisourcing. See: sole source.
","itemType":1,"order":1},{"id":25397,"sectionId":9597,"title":"Definition","data":"Dual Sourcing is a method for sourcing requirements by using a few suppliers for the same products or services. See: multisourcing, multiple sourcing, single sourcing.
","itemType":1,"order":1},{"id":25402,"sectionId":9598,"title":"Definition","data":"Portfolio Analysis is the practice of segmenting sourcing into four categories so that the appropriate level of management attention and resources can be applied to the sourcing and procurement processes.
This model can be used to determine which suppliers are most appropriate for each of the four types of goods or services:
Supplier Segmentation is a practice that organizes the relationship with suppliers by positioning them into different segments based on many parameters, suppliers in each category can have transactional, preferred, strategic, or ownership relationships.
Supplier segments range across a spectrum of buyer-supplier relationships. At one end of the spectrum is the traditional transactional supplier segment, or “buy on the market.” The next segment is preferred suppliers. The strategic relationship segment needs to be a core supplier.
Another approach to segmenting suppliers would be a 20:80 approach where some suppliers are classed A, others are B, and C depending on the among of spend and the type of material.
","itemType":1,"order":1},{"id":25412,"sectionId":9600,"title":"Definition","data":"Supply Base Rightsizing or rationalization involves a review of the suppliers in a category to determine the ideal number. Usually, this involves finding categories with too many suppliers and reducing that number by awarding the business to fewer, more preferred suppliers.
Rightsizing can improve the quality of remaining suppliers or get quantity discounts, reducing administrative costs. Ordering costs and supplier relationship management costs. More time can be spent on each supplier when fewer suppliers exist, and this can enable more collaborative relationships.
Pareto analysis can be used, and the top 20 percent of suppliers by category spend could be those retained. A set of more rigid supplier requirements could be rolled out to all suppliers with an ultimatum to meet the requirements or be dropped. A triage approach could be used to evaluate suppliers and place them into categories such as unacceptable, minimum qualifying, and world-class performance. other organizational goals might also be accommodated, such as prioritizing the use of local suppliers or retaining suppliers who meet sustainability objectives.
","itemType":1,"order":1},{"id":25417,"sectionId":9349,"title":"Definition","data":"A Circular Economy is an economic system intended to minimize waste and maximize the use of resources through a regenerative process achieved through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, recycling, and upcycling. This is the opposite of a linear economy
","itemType":1,"order":1},{"id":25422,"sectionId":9350,"title":"Definition","data":"Product-as-a-service is the concept of selling the services and outcomes a product can provide rather than the product itself.
","itemType":1,"order":1},{"id":25427,"sectionId":9351,"title":"Definition","data":"A Material Passport (or product passport) is a digital interface composing a certified identity of a single identifiable product by accessing the set of life cycle registrations linked to this object in order to yield insight on the sustainability and circularity characteristics, the circular value estimation, and the circular opportunities for both that product and its underlying components and materials.
","itemType":1,"order":1},{"id":25432,"sectionId":9352,"title":"Definition","data":"A Sharing Platform is a circular business model in which a business promotes collaboration among users to increase the usage and value derived from products.
","itemType":1,"order":1},{"id":25437,"sectionId":9353,"title":"Definition","data":"Life Cycle Assessment (LCA) is a process to help understand the human and environmental impacts during the life of a product, process, or service, including energy, material, and environmental inputs and outputs. Sometimes called cradle-to-grave analysis, LCA includes raw material extraction through materials processing, manufacture, distribution, use, repair and maintenance, and disposal or recycling.
","itemType":1,"order":1},{"id":25442,"sectionId":9354,"title":"Definition","data":"Eco-design, or ecological design, is an approach to designing products and services that gives special consideration to the environmental impacts of a product over its entire lifecycle.
","itemType":1,"order":1},{"id":25447,"sectionId":9355,"title":"Definition","data":"Material Efficiency Management is an approach that aims to manufacture a product by using fewer materials.
","itemType":1,"order":1},{"id":25452,"sectionId":9356,"title":"Definition","data":"Energy Efficiency Management is an approach that aims to manufacture a product or service by using less energy.
","itemType":1,"order":1},{"id":25457,"sectionId":9357,"title":"Definition","data":"Water Efficiency Management is the set of activities that aims to reduce water consumption, water withdrawal, and water discharge and increase the amount of water reused and recycled.
","itemType":1,"order":1},{"id":25462,"sectionId":9358,"title":"Definition","data":"Sustainability Reporting is the disclosure and communication of environmental, social, and governance (ESG) goals—as well as a company's progress towards them.
","itemType":1,"order":1},{"id":25467,"sectionId":9359,"title":"Definition","data":"Emissions Reduction is the measurable reduction of the release of GHG emissions in the atmosphere from a specified activity in the supply chain and a specific period of time.
","itemType":1,"order":1},{"id":25472,"sectionId":9360,"title":"Definition","data":"Carbon Removal/Offsetting is a way to compensate for an organization's carbon dioxide emissions, either by reducing carbon dioxide emissions elsewhere in the business or by funding projects intended to improve the environment, such as renewable energy or forest conservation. This funding can be in the form of credits purchased on an exchange to meet compliance legislation, cap and trade systems, or as a voluntary effort.
","itemType":1,"order":1},{"id":25477,"sectionId":9361,"title":"Definition","data":"Traceability provides the capabilities that allow the ongoing location of a shipment to be determined. The registering and tracking of parts, processes, and materials used in production, by lot or serial number.
","itemType":1,"order":1},{"id":25482,"sectionId":9479,"title":"Definition","data":"Proof of Concept is when an organization introduces the system in a small-scale and controlled environment to walk through and ensure the technology's compatibility
","itemType":1,"order":1},{"id":25486,"sectionId":9601,"title":"Definition","data":"Social Procurement is the practice of organizations using their buying power to generate social value above and beyond the value of the goods, services, or construction being procured.
Social procurement can be the direct Purchasing of goods, services, or construction from social enterprises and/or other social benefit suppliers.
Indirect using the invitation to supply process and clauses in contracts with the private sector to seek social and sustainable outcomes.
","itemType":1,"order":1},{"id":25491,"sectionId":9602,"title":"Definition","data":"Digital Invoice and Payments Processing is the ability to accommodate multiple formats and channels for receiving invoices and systematically turn purchase orders into invoices for touchless transaction processing. Invoice and Payment Processing also includes the use of multiple electronic invoicing technologies to process all invoice types, automate two-way and three-way matching, and streamline exception routing and resolution to minimize invoice processing time and support supply chain financing and dynamic discounting.
","itemType":1,"order":1},{"id":25496,"sectionId":9603,"title":"Definition","data":"Digital Contract Management provides the ability to enable proactive contract life cycle management with customizable workflows that provide visibility at each step of authoring, facilitate contract negotiations, and thereafter enforce contractual terms to realize cost savings and achieve desired performance levels.
","itemType":1,"order":1},{"id":25501,"sectionId":9604,"title":"Definition","data":"Web Services are a common internet or intranet framework that enables the movement of data from one supply chain application to another, without the requirement for a direct connection between the two applications and without regard to the underlying operating system for those applications
","itemType":1,"order":1},{"id":25506,"sectionId":9405,"title":"Definition","data":"Data Master File Management is a process to make master data—such as customer, supplier, items, and employee data—easily accessed and to provide accurate information for any business application.
","itemType":1,"order":1},{"id":25510,"sectionId":9406,"title":"Definition","data":"Metadata Management enables designers to organize and define the meaning of data within an organization’s system. The goal is to assure consistency, completeness, and visibility through service directories, data directories, content directories, translation, retrieval, and navigation processes.
","itemType":1,"order":1},{"id":25514,"sectionId":9520,"title":"Definition","data":"Engineer Trading Partner Processes is the task of generating the desired inter-enterprise linkages that require the full participation of customers and suppliers regardless of the desired complexity of the proposed connectivity.
","itemType":1,"order":1},{"id":25518,"sectionId":9362,"title":"Definition","data":"Internal Infrastructure and System Re-engineering is involved in the technology changes that supply chain interoperability requires. This may include enhancements to existing systems or the purchase of point solutions, such as business-to-business (B2B), to supplement legacy system deficiencies. Normally, this process will require customization of the “wrapper programs” of existing ERP/SCM systems to accommodate the linkages needed to work with new packaged software, portals, and other interoperability solutions.
","itemType":1,"order":1},{"id":25521,"sectionId":9407,"title":"Definition","data":"According to Hoque, e-application architecture involves determining individual integration points between the application and data sources, the application and back-end installed software, and between multiple back-end systems. Every decision should be made with a good deal of attention toward not only the functionality of the application the day it is rolled out but also the ability of the platform to scale up to support heavy usage, added business attributes, new users, and additional functionality in later revisions.
","itemType":1,"order":1},{"id":25525,"sectionId":9605,"title":"Definition","data":"Web-Based Applications are a variety of customer- and supplier-side software applications that are Web-enabled and directly integrated with enterprise business system backbone applications, such as CRM, CPC, MES, SCM, BI, e-Finance, and Human Resources
","itemType":1,"order":1},{"id":25530,"sectionId":9363,"title":"Definition","data":"Collaborative Channel Management tools focus on two e-market objectives: the ability to move beyond a marketing strategy that focuses purely on customer segmentation to one that can provide appropriate levels of services to customers with a different value and to construct Internet-empowered logistics systems that link supplier selection and transportation visibility with company customer service functions.
","itemType":1,"order":1},{"id":25534,"sectionId":9375,"title":"Definition","data":"Web Systems are used by more and more of today’s forward-looking companies that want to provide their customers with easy-to-use Websites. Effectively constructed Web sites enable customers to visit catalogs, enter orders, review pricing, configure orders, participate in auctions and perform a host of self-service functions from order status review to online learning.
","itemType":1,"order":1},{"id":25539,"sectionId":9483,"title":"Definition","data":"Online Catalogs provide customers with the opportunity to research and compare the array of products, prices, and services offered by a supplier.
","itemType":1,"order":1},{"id":25544,"sectionId":9376,"title":"Definition","data":"Online Order Processing provides the e-commerce capabilities needed to process customers' orders, make them ready for shipment or production, and deliver the order in the customer selected method.
","itemType":1,"order":1},{"id":25549,"sectionId":9484,"title":"Definition","data":"Online Order Configurability enables customers to design their own products and services through special configuration capabilities.
","itemType":1,"order":1},{"id":25553,"sectionId":9377,"title":"Definition","data":"Lead Capture and Profiling provides detailed repositories of prospect inquiries, customer sales, and profile information that can be mined to provide information for Web site personalization or marketing follow-up.
","itemType":1,"order":1},{"id":25556,"sectionId":9378,"title":"Definition","data":"Contact Management enables the organization and management of prospect and customer data, such as names, addresses, phone numbers, titles, and so forth, the creation and display of organizational charts, the ability to maintain marketing notes, identification of decision-makers, and capability to link to supplementary databases.
","itemType":1,"order":1},{"id":25561,"sectionId":9408,"title":"Definition","data":"Account Management provides detailed information regarding account data and sales activity that can be accessed on-demand.
","itemType":1,"order":1},{"id":25565,"sectionId":9364,"title":"Definition","data":"Sales Process/Activity Management provides embedded, customizable sales process methodologies designed to serve as a road map guiding sales activity management.
","itemType":1,"order":1},{"id":25569,"sectionId":9379,"title":"Definition","data":"Quotation Management provides the ability to develop quotations for complex orders requiring product configuration and pricing.
","itemType":1,"order":1},{"id":25574,"sectionId":9494,"title":"Definition","data":"A widely recognized international standard for managing human rights in the workplace. It provides an auditable framework for assuring that social accountability is being stewarded by an organization.
","itemType":1,"order":1},{"id":25577,"sectionId":9616,"title":"Definition","data":"BP.004 Network Prioritization for Risk Identification
BP.005 Self-Invoicing
BP.007 Baseline Inventory Monitoring
BP.008 Slow-Moving Inventory Monitoring
BP.014 Demand Planning and Forecasting
BP.015 Safety Stock Planning
BP.017 Distribution Planning
BP.020 Demand Management
BP.028 Inventory Optimization
BP.029 Network Optimization
BP.030 Inventory Record Accuracy
BP.031 Stock Keeping Unit (SKU) Rationalization and Cost of Sales Analysis
BP.034 Extend Inventory Planning Using Collaboration
BP.039 Right Size Frequency of Production Wheel
BP.041 Transportation Optimization
BP.048 Demand Shaping
BP.049 Lean Planning
BP.055 Freight Carrier Delivery Performance Evaluation
BP.062 Master Data Accuracy
BP.068 Supplier Performance Reporting
BP.071 Modal Optimization
BP.080 Enterprise Performance Management
BP.084 Inventory Cycle Counting
BP.098 Mobile Access of Information
BP.099 Data Warehousing and Business Intelligence
BP.111 Electronic Technical Orders and Product Specifications
BP.114 Order Quotation System
BP.115 Transportation Management System (TMS)
BP.119 Generation of Dynamic Bills of Materials (BOMs)
BP.120 3D Printing and Rapid Prototyping
BP.121 Digital Packaging on Demand
BP.123 Return Load Optimization
BP.125 Automated Identification and Disposition of Overshipments
BP.126 Supply Chain Control Towers
BP.127 Automated Alerts for Material Management
BP.134 Supplier Evaluation
BP.149 Supply Chain Risk Management (SCRM) Strategy Implementation and Analysis
BP.151 Real-Time Package Tracking
BP.152 Automated Data Capture (ADC)
BP.153 Radio Frequency Identification (RFID)
BP.156 Collaborative Planning, Forecasting, and Replenishment (CPFR)
BP.159 Electronic Data Interchange (EDI)
BP.161 Spend Analysis
BP.166 Document Management System
BP.167 Electronic Returns Tracking
BP.172 Production Scheduling Optimization Using Technology
BP.177 Additive Manufacturing
BP.178 Blockchain
BP.181 Digital Supply Chain
BP.182 Internet of Things (IOT)
BP.184 Scenario Planning
BP.187 Supply Chain Finance
BP.189 Augmented Reality
BP.190 Robotic Process Automation
BP.191 Artificial Intelligence
BP.192 Big Data Analytics
BP.193 Should Cost Modeling
BP.194 Predictive Analytics
BP.195 Digital Twin
BP.196 Smart Contracts
BP.197 Advanced Data Visualization and Visibility
BP.198 Real-Time Location System
BP.199 Autonomous Delivery
BP.200 Stocktaking by Drones
BP.201 Dynamic Inventory Management
BP.202 Quick Response (QR) Code
BP.203 Mobile Distribution Center
BP.204 Machine Learning
BP.205 Dynamic Routing
BP.206 Virtual Reality
BP.207 Multi-Enterprise Business Networks (MEBN)
BP.209 Telematics
BP.211 Fleet Management
BP.212 Smart Factory
BP.250 Supplier Credit Check
BP.251 Category Management
BP.253 Specification Value Analysis
BP.254 Specification Value Engineering
BP.256 Make Or Buy Analysis
BP.262 Trade Exchanges
BP.263 E-Catalogs
BP.265 Continuous Replenishment Program
BP.266 Total Cost of Ownership Analysis
BP.267 Price Analysis
BP.268 Purchase Price Cost Analysis
BP.270 MEAT Awarding (Most Economically Advantageous Tender)
BP.278 Portfolio Analysis
BP.279 Supplier Segmentation
BP.280 Supply Base Rightsizing
BP.285 Material Passport
BP.300 Traceability
BP.305 Digital Invoice and Payments Processing
BP.306 Digital Contract Management
BP.307 Web Services
BP.319 Internal Infrastructure and System Re-engineering
BP.320 E-Application Architecture
BP.321 Web-Based Applications
BP.322 Collaborative Channel Management
BP.325 Web Systems
BP.326 Online Catalogs
BP.327 Online Order Processing
BP.328 Online Order Configurability
BP.329 Lead Capture and Profiling
BP.330 Contact Management
BP.331 Account Management
BP.332 Sales Process/Activity Management
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BP.002 Risk Management Strategies
BP.003 Single-Minute Exchange of Die (SMED)
BP.004 Network Prioritization for Risk Identification
BP.005 Self-Invoicing
BP.006 Consignment Inventory
BP.007 Baseline Inventory Monitoring
BP.008 Slow-Moving Inventory Monitoring
BP.009 Kanban
BP.010 Min-Max Replenishment
BP.011 Production Line Sequencing
BP.012 Lot Tracking
BP.013 Item Rationalization
BP.016 Supply Network Planning
BP.018 ABC Inventory Classification System
BP.021 Sales and Operations Planning (S&OP)
BP.022 Material Requirements Planning (MRP)
BP.023 Business Rule Management
BP.024 Supply Chain Optimization (SCO)
BP.025 Self-Service Warranty Claim Submittal
BP.026 Improve Sales and Operations Planning (S&OP) Process
BP.027 Pull-Based Inventory Replenishment
BP.032 Reduce or Write Off Slow-Moving Inventory
BP.033 Traditional Demand Forecasting Improvement
BP.035 Business Rule Review
BP.036 Consignment Inventory with Suppliers
BP.037 Manufacturing Direct or Drop Shipment
BP.038 Batch-Size Reduction
BP.039 Right Size Frequency of Production Wheel
BP.040 Make-to-Order (MTO) Order Fulfillment Strategy
BP.042 Procurement Terms and Conditions Review
BP.044 Inventory Financing Evaluation
BP.045 Delay Inbound Supplier Shipments
BP.047 Finished Goods Inventory Postponement
BP.052 Design for Logistics (DFL) Management
BP.053 Manufacturing Reliability Improvement
BP.054 Manufacturing Quality Improvements for Return Reduction
BP.055 Freight Carrier Delivery Performance Evaluation
BP.056 Supplier Raw Material Quality Assurance
BP.058 Inventory Management Training
BP.061 Reduce Non-Strategic Inventory Level
BP.062 Master Data Accuracy
BP.063 Optimize Sourcing Decisions to Local Source Point
BP.064 Safety Stock Reduction
BP.066 Returns Policy to Reduce Returns Inventory
BP.067 Returns Inventory Reduction
BP.068 Supplier Performance Reporting
BP.069 Raw Materials Receiving Process
BP.071 Modal Optimization
BP.072 Inbound Return Material Authorization (RMA)–Enabled Processing
BP.073 Returns Receiving Refurbishment
BP.074 Process and Metrics Alignment
BP.076 Bar Coding
BP.077 Prepaid Return Shipping Label
BP.078 Return Tracking
BP.080 Enterprise Performance Management
BP.082 Continuous Improvement
BP.083 Project Management
BP.086 Supply Network Planning
BP.089 Perfect Pick Put-Away
BP.090 Days of Supply–Based Material Requirements Planning (MRP) Proposal Management
BP.091 Work Center Load Evaluation
BP.092 Balance and Firm within Horizon
BP.093 Production Plan
BP.094 Characteristics-Based Forecasting
BP.095 Bill of Material (BOM) Audit and Control
BP.096 Logistics and Warehouse Planning
BP.097 Supplier Appraisal
BP.099 Data Warehousing and Business Intelligence
BP.100 Strategic Sourcing
BP.101 Purchasing and Procurement Strategy
BP.102 Pick List Generation
BP.103 Customer Data Line of Responsibility
BP.104 Facility Master Planning
BP.105 Task Management
BP.106 Predictive Maintenance
BP.107 Order Management
BP.108 Return Policy Conformance Integration
BP.109 Carcass Prepositioning
BP.111 Electronic Technical Orders and Product Specifications
BP.112 Return Shipping Consolidation
BP.115 Transportation Management System (TMS)
BP.116 Expedited Logistics
BP.117 Embed Specialized Services
BP.118 Transportation Management Outsourcing
BP.119 Generation of Dynamic Bills of Materials (BOMs)
BP.121 Digital Packaging on Demand
BP.122 Vendor-Managed Inventory (VMI)
BP.123 Return Load Optimization
BP.124 Return Shipment Insurance
BP.128 Return Cost Recovery
BP.129 Return Policy Included with Shipping Document
BP.130 Identification of Obsolete Capital Assets
BP.131 Request for Information (RFI)
BP.132 Request for Quote (RFQ)
BP.133 Total Preventative Maintenance Program
BP.134 Supplier Evaluation
BP.135 Return Authorization
BP.136 Outsourced Reverse Logistics
BP.138 Theory of Constraints (TOC)
BP.141 Pre-issued Return Authorization
BP.143 Preventive Returns
BP.144 Purchase Order Management
BP.145 Supplier Collaboration
BP.146 Cross-Docking
BP.147 Receiving Goods Inspection
BP.148 3-Way Delivery Verification
BP.149 Supply Chain Risk Management (SCRM) Strategy Implementation and Analysis
BP.150 Maintain Supply Chain Risk Register
BP.151 Real-Time Package Tracking
BP.152 Automated Data Capture (ADC)
BP.153 Radio Frequency Identification (RFID)
BP.155 Standard Operating Procedures
BP.156 Collaborative Planning, Forecasting, and Replenishment (CPFR)
BP.157 Just-in-Time (JIT) Production
BP.158 Make-to-Stock (MTS) Goods Receipt
BP.159 Electronic Data Interchange (EDI)
BP.160 Lean
BP.161 Spend Analysis
BP.162 Long-Term Supplier Agreement or Partnership
BP.163 Supply Base Rationalization
BP.164 Consignment Inventory Management
BP.165 Convergence of SCOR with Lean and Six Sigma
BP.168 Rotable Spares Pool
BP.169 Beyond Economic Repair (BER) Management
BP.171 Mixed Mode or Reverse Material Issue
BP.173 Supply Chain Risk Monitoring
BP.174 Supply Chain Risk Assessment
BP.179 Demand-Driven Material Requirements Planning (DDMRP)
BP.180 Demand-Driven Sales and Operations Planning (DDS&OP)
BP.183 Integrated Business Planning (IBP)
BP.185 Cost of Quality Measurement
BP.188 Supply Chain Management Object Synchronization (3- or 4-Way Match)
BP.190 Robotic Process Automation
BP.208 Crowdsourced Delivery
BP.211 Fleet Management
BP.215 Service Configuration Management
BP.216 Service Level Management
BP.217 Service Change Management
BP.218 Service Incident Management
BP.219 Service Request Management
BP.220 Service Availability Management
BP.221 Service Capacity Management
BP.222 Service Continuity Management
BP.223 Service Knowledge Management System
BP.224 Service Validation and Testing Management
BP.225 Service Valuation Management
BP.226 Service Design Management
BP.227 Service Transition Management
BP.228 Service Problem Management
BP.229 Continual Service Improvement
BP.230 Dynamic Case Management
BP.231 Business Rules Management System
BP.232 Green Procurement
BP.233 Ethical Procurement
BP.236 Early Supplier Involvement
BP.237 In-Country Value
BP.238 Negotiations Planning
BP.239 Contract Drafting
BP.240 Framework Agreement
BP.241 Supply Market Research
BP.242 Specification Development
BP.243 Blanket Agreement
BP.244 Sustainable Specification Development
BP.245 Supplier Certification Program
BP.246 Sustainable Procurement Strategy
BP.247 Multi-Tier Supplier Audit
BP.249 Approved Vendor List
BP.250 Supplier Credit Check
BP.251 Category Management
BP.253 Specification Value Analysis
BP.254 Specification Value Engineering
BP.256 Make Or Buy Analysis
BP.257 Outsourcing
BP.258 Open Tendering
BP.259 Restricted Tendering
BP.260 Reverse Auction
BP.261 Spot Buying
BP.262 Trade Exchanges
BP.263 E-Catalogs
BP.265 Continuous Replenishment Program
BP.266 Total Cost of Ownership Analysis
BP.267 Price Analysis
BP.268 Purchase Price Cost Analysis
BP.269 Supplier Debriefing
BP.270 MEAT Awarding (Most Economically Advantageous Tender)
BP.272 Solicitation Process
BP.273 Purchase Price Arrangement
BP.274 Progress Payment
BP.275 Single Sourcing
BP.276 Dual Sourcing
BP.278 Portfolio Analysis
BP.279 Supplier Segmentation
BP.280 Supply Base Rightsizing
BP.282 Circular Economy
BP.283 Product-as-a-Service
BP.286 Sharing Platforms
BP.288 Life Cycle Assessment
BP.289 Eco-design
BP.290 Material Efficiency Management
BP.291 Energy Efficiency Management
BP.292 Water Efficiency Management
BP.294 Sustainability Reporting
BP.295 Emission Reduction
BP.296 Carbon Removal/Offsetting
BP.301 Proof of Concept
BP.305 Digital Invoice and Payments Processing
BP.306 Digital Contract Management
BP.307 Web Services
BP.309 Data Master File Management
BP.314 Metadata Management
BP.318 Engineer Trading Partner Processes.
BP.321 Web-Based Applications
BP.322 Collaborative Channel Management
BP.329 Lead Capture and Profiling
BP.330 Contact Management
BP.331 Account Management
BP.332 Sales Process/Activity Management
BP.333 Quotation Management
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BP.003 Risk Management Strategies
BP.004 Network Prioritization for Risk Identification
BP.023 Business Rule Management
BP.024 Supply Chain Optimization (SCO)
BP.040 Make-to-Order (MTO) Order Fulfillment Strategy
BP.042 Procurement Terms and Conditions Review
BP.058 Inventory Management Training
BP.070 Planning and Scheduling Inventory Training
BP.080 Enterprise Performance Management
BP.083 Project Management
BP.093 Production Plan
BP.103 Customer Data Line of Responsibility
BP.105 Task Management
BP.110 Product Development, Engineering and Disposition Collaboration
BP.113 Cross-Functional Teams
BP.129 Return Policy Included with Shipping Document
BP.144 Purchase Order Management
BP.160 Lean
BP.257 Outsourcing
BP.294 Sustainability Reporting
BP.302 Social Procurement
BP.319 Internal Infrastructure and System Re-engineering
BP.334 Social Accountability (SA8000)
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","itemType":1,"order":2},{"id":20989,"sectionId":7980,"title":"Performance attributes","data":"A performance attribute is a grouping or categorization of metrics used to express a specific strategy. An attribute itself cannot be measured; it is used to set strategic direction. For example: \"The LX product needs to lead the competition in reliability,\" and \"The XY market requires us to be among the top 10 agile manufacturers.\" Metrics measure the ability to achieve these strategic directions. SCOR recognizes three performance categories and eight performance attributes:
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It is important to understand that different practices have different performance expectations, and the classification of a practice will vary by industry. A practice may be standard in some industries but may be considered an emerging practice or a best practice in other industries. The SCOR list of practices has been established based on input from practitioners and experts from a diverse range of industries.
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Note: An order is perfect if the individual line items making up that order are all perfect.
The Perfect Order Fulfillment calculation is based on the performance of each level-2 component of the order line to be calculated (product and quantity; date, time and customer; documentation; and condition). For an order line to be perfect, all of the individual components must be perfect:
(Total number of orders delivered in full / Total number of orders delivered) x 100%
An order is considered delivered in full if
(Total number of orders delivered to the original commitment date / Total number of orders delivered) x 100%
An order is considered delivered to the original customer commitment date if
(Total number of orders delivered with accurate documentation / Total number of orders delivered) x 100%
An order is considered to have accurate documentation when the order includes
All documentation must be complete, correct and readily available when and how it is expected by the customer, government and other supply chain regulatory entities.
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An order is considered to be delivered in perfect condition if all items
Delivery Performance to Original Supplier Commit Date = [Total number of orders delivered in full and on time to the scheduled commit date] / [Total number of orders delivered]
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","itemType":1,"order":2},{"id":22815,"sectionId":8498,"title":"Calculation","data":"Strategic Order Agility is calculated by identifying the master data setting for the assumed order lead times in your system of record. Operational Order Agility is calculated by dividing the new order volume by the original planned order volume. Both measures assume no expedite costs.
","itemType":1,"order":2},{"id":22820,"sectionId":8499,"title":"Calculation","data":"Strategic Source Agility is calculated by identifying the master data setting for the longest lead times in your BOM as noted in the system of record. Operational Source Agility is calculated by dividing the new increased or decreased purchase order volume by the original planned purchase order volume. Both measures assume no expedite costs.
","itemType":1,"order":2},{"id":22825,"sectionId":8500,"title":"Calculation","data":"Strategic Transform Agility is calculated by identifying the master data setting for the manufacturing (service) lead time as noted in the system of record. Operational Transform Agility is calculated by dividing the new manufacturing and/or service order volume by the original planned order volume. Both measures assume no expedite costs.
","itemType":1,"order":2},{"id":22830,"sectionId":8501,"title":"Calculation","data":"Strategic Fulfill Agility is calculated by identifying the master data setting for the longest shipment lead times as noted in the system of record. Operational Fulfill Agility is calculated by dividing the new shipment volume by the original planned shipment volume. Both measures assume no expedite costs.
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(Please see individual component categories for component detail and calculations)
","itemType":1,"order":2},{"id":22878,"sectionId":8519,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"CO.3.1","name":"New Product Release Phase-In and Maintenance","url":"/performance/cost/CO.3.1"},{"generatedExternalId":false,"externalId":"CO.3.2","name":"Create Customer Order","url":"/performance/cost/CO.3.2"},{"generatedExternalId":false,"externalId":"CO.3.3","name":"Order Entry and Maintenance","url":"/performance/cost/CO.3.3"},{"generatedExternalId":false,"externalId":"CO.3.4","name":"Contract/Program and Channel Management","url":"/performance/cost/CO.3.4"},{"generatedExternalId":false,"externalId":"CO.3.5","name":"Installation Planning","url":"/performance/cost/CO.3.5"},{"generatedExternalId":false,"externalId":"CO.3.6","name":"Order Fulfillment","url":"/performance/cost/CO.3.6"},{"generatedExternalId":false,"externalId":"CO.3.7","name":"Distribution","url":"/performance/cost/CO.3.7"},{"generatedExternalId":false,"externalId":"CO.3.8","name":"Transportation, Outbound Freight and Duties","url":"/performance/cost/CO.3.8"},{"generatedExternalId":false,"externalId":"CO.3.9","name":"Installation","url":"/performance/cost/CO.3.9"},{"generatedExternalId":false,"externalId":"CO.3.10","name":"Customer Invoicing/Accounting","url":"/performance/cost/CO.3.10"}],"itemType":2,"order":2},{"id":22882,"sectionId":8520,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"CO.3.11","name":"Materials (Commodity) Management and Planning","url":"/performance/cost/CO.3.11"},{"generatedExternalId":false,"externalId":"CO.3.12","name":"Supplier Quality Engineering","url":"/performance/cost/CO.3.12"},{"generatedExternalId":false,"externalId":"CO.3.13","name":"Inbound Freight and Duties","url":"/performance/cost/CO.3.13"},{"generatedExternalId":false,"externalId":"CO.3.14","name":"Receiving and Material Storage","url":"/performance/cost/CO.3.14"},{"generatedExternalId":false,"externalId":"CO.3.15","name":"Incoming Inspection","url":"/performance/cost/CO.3.15"},{"generatedExternalId":false,"externalId":"CO.3.16","name":"Material Process and Component Engineering","url":"/performance/cost/CO.3.16"},{"generatedExternalId":false,"externalId":"CO.3.17","name":"Tooling","url":"/performance/cost/CO.3.17"}],"itemType":2,"order":2},{"id":22885,"sectionId":8521,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"CO.3.18","name":"Opportunity","url":"/performance/cost/CO.3.18"},{"generatedExternalId":false,"externalId":"CO.3.19","name":"Shrinkage","url":"/performance/cost/CO.3.19"},{"generatedExternalId":false,"externalId":"CO.3.20","name":"Insurance and Taxes","url":"/performance/cost/CO.3.20"},{"generatedExternalId":false,"externalId":"CO.3.21","name":"Total Obsolescence for Raw Material, WIP, and Finished Goods Inventory","url":"/performance/cost/CO.3.21"},{"generatedExternalId":false,"externalId":"CO.3.22","name":"Channel Obsolescence","url":"/performance/cost/CO.3.22"},{"generatedExternalId":false,"externalId":"CO.3.23","name":"Field Service Parts Obsolescence","url":"/performance/cost/CO.3.23"}],"itemType":2,"order":2},{"id":22888,"sectionId":8522,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"CO.3.24","name":"Supply-Chain Finance Costs","url":"/performance/cost/CO.3.24"},{"generatedExternalId":false,"externalId":"CO.3.25","name":"Demand/Supply Planning Costs","url":"/performance/cost/CO.3.25"}],"itemType":2,"order":2},{"id":22891,"sectionId":8523,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.187","name":"Supply Chain Finance","url":"/practices/best practices by category/BP.187"}],"itemType":2,"order":2},{"id":22893,"sectionId":8524,"title":"Calculation","data":"COGS = Cost to Transform
or
COGS = direct material costs + direct labor costs + indirect costs related to making a product
","itemType":1,"order":2},{"id":22900,"sectionId":8525,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"CO.3.26","name":"Tariffs as Percentage of COGS","url":"/performance/cost/CO.3.26"}],"itemType":2,"order":2},{"id":22904,"sectionId":8526,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE5","name":"Human Resources","url":"/processes/orchestrate supply chain/OE5"}],"itemType":2,"order":2},{"id":22907,"sectionId":8527,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE5","name":"Human Resources","url":"/processes/orchestrate supply chain/OE5"},{"generatedExternalId":false,"externalId":"F1.1","name":"Receive B2C Product from Source or Transform","url":"/processes/fulfill/F1.1"},{"generatedExternalId":false,"externalId":"F2.1","name":"Receive B2B Product from Source or Transform","url":"/processes/fulfill/F2.1"},{"generatedExternalId":false,"externalId":"F3.1","name":"Receive Intra-company Product from Source or Transform","url":"/processes/fulfill/F3.1"}],"itemType":2,"order":2},{"id":22922,"sectionId":8541,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"S2.3","name":"Manage inbound transport","url":"/processes/source/S2.3"},{"generatedExternalId":false,"externalId":"S3.3","name":"Manage inbound transport","url":"/processes/source/S3.3"}],"itemType":2,"order":2},{"id":22924,"sectionId":8542,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"S2.4","name":"Receive product","url":"/processes/source/S2.4"},{"generatedExternalId":false,"externalId":"S3.4","name":"Receive product","url":"/processes/source/S3.4"}],"itemType":2,"order":2},{"id":22926,"sectionId":8543,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"S2.5","name":"Inspect and verify","url":"/processes/source/S2.5"},{"generatedExternalId":false,"externalId":"S3.5","name":"Inspect and verify","url":"/processes/source/S3.5"}],"itemType":2,"order":2},{"id":22938,"sectionId":8554,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE8.1","name":"Determine regulatory and compliance requirements that apply to business and future compliance requirements","url":"/processes/orchestrate supply chain/OE8.1"},{"generatedExternalId":false,"externalId":"OE8.2","name":"Monitor regulatory environment","url":"/processes/orchestrate supply chain/OE8.2"},{"generatedExternalId":false,"externalId":"OE8.3","name":"Assess regulatory impact","url":"/processes/orchestrate supply chain/OE8.3"}],"itemType":2,"order":2},{"id":22940,"sectionId":8555,"title":"Calculation","data":"EBIT = Revenue - COGS - Operating Expenses.
","itemType":1,"order":2},{"id":22944,"sectionId":8556,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE1","name":"Supply Chain Strategy","url":"/processes/orchestrate supply chain/OE1"},{"generatedExternalId":false,"externalId":"OE3","name":"Performance and Continuous Improvement","url":"/processes/orchestrate supply chain/OE3"},{"generatedExternalId":false,"externalId":"OE5","name":"Human Resources","url":"/processes/orchestrate supply chain/OE5"},{"generatedExternalId":false,"externalId":"OE6","name":"Contracts and Agreements","url":"/processes/orchestrate supply chain/OE6"},{"generatedExternalId":false,"externalId":"OE8","name":"Regulatory and Compliance","url":"/processes/orchestrate supply chain/OE8"},{"generatedExternalId":false,"externalId":"OE11","name":"Enterprise Business Planning","url":"/processes/orchestrate supply chain/OE11"},{"generatedExternalId":false,"externalId":"OE13","name":"Circular Supply Chain Management","url":"/processes/orchestrate supply chain/OE13"},{"generatedExternalId":false,"externalId":"S","name":"Source","url":"/processes/source/S"}],"itemType":2,"order":2},{"id":22947,"sectionId":8557,"title":"Calculation","data":"Cash-to-Cash Cycle Time = Inventory Days of Supply + Days Sales Outstanding - Days Payable Outstanding
","itemType":1,"order":2},{"id":22954,"sectionId":8558,"title":"Calculation","data":"Five-point annual average of gross accounts receivable / (Total gross annual sales / 365 days)
","itemType":1,"order":2},{"id":22958,"sectionId":8559,"title":"Calculation","data":"Five-point rolling average of gross value of inventory at standard cost / Annual cost of goods sold] / 365 days
Example: If two items a day are sold and 20 items are held in inventory, this represents 10 days’ (20/2) worth of sales in inventory.
","itemType":1,"order":2},{"id":22963,"sectionId":8560,"title":"Calculation","data":"Five-point rolling average of gross accounts payable / Total gross annual material purchases / 365 days
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| Categories | |
| Business Process Analysis and Improvement | People Management (Including Training) |
| Customer Support | Planning and Forecasting |
| Distribution Management | Product Life Cycle Management |
| Information and Data Management | Purchasing and Procurement |
| Inventory Management | Reverse Logistics |
| Manufacturing and Production | Risk and Security Management |
| Material Handling | Sustainable Supply Chain Management |
| New Product Introduction | Transportation Management |
| Order Engineering | Warehousing |
| Order Management |
The practices listed in SCOR are for identification purposes only. Further research and analysis is generally required to fully understand how to implement a practice. For example, SCOR recognizes Sales and Operations Planning (S&OP) (BP.021) as a practice and lists which processes and metrics might be impacted. For detailed process and implementation design, an organization will need to consult other sources, such as books, case studies, seminars and consultancies. Some practices may be registered by other organizations. APICS does not claim ownership of these practices but merely recognizes their relevance and value. Some practices may be copyright of their respective owners, but many practices are in the common domain.
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Orders may not be filled completely to the customer’s original request quantity because of the inability to schedule to the initial request. Breakdown may also occur from the inventory availability (including stockouts for make-to-stock and schedule achievement for make-to-order and engineer-to-order processes) and inventory location accuracy. Lastly, a deviation from the shipment plan may lead to an inability to completely fulfill an order.
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category/BP.116"},{"generatedExternalId":false,"externalId":"BP.118","name":"Transportation Management Outsourcing","url":"/practices/best practices by category/BP.118"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.167","name":"Electronic Returns Tracking","url":"/practices/best practices by category/BP.167"},{"generatedExternalId":false,"externalId":"BP.168","name":"Rotable Spares Pool","url":"/practices/best practices by category/BP.168"}],"itemType":2,"order":3},{"id":22425,"sectionId":8309,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.012","name":"Lot Tracking","url":"/practices/best practices by category/BP.012"},{"generatedExternalId":false,"externalId":"BP.030","name":"Inventory Record Accuracy","url":"/practices/best practices by category/BP.030"},{"generatedExternalId":false,"externalId":"BP.062","name":"Master Data Accuracy","url":"/practices/best practices by category/BP.062"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.147","name":"Receiving Goods Inspection","url":"/practices/best practices by category/BP.147"},{"generatedExternalId":false,"externalId":"BP.148","name":"3-Way Delivery Verification","url":"/practices/best practices by category/BP.148"},{"generatedExternalId":false,"externalId":"BP.188","name":"Supply Chain Management Object Synchronization (3- or 4-Way Match)","url":"/practices/best practices by category/BP.188"},{"generatedExternalId":false,"externalId":"BP.190","name":"Robotic Process Automation","url":"/practices/best practices by category/BP.190"}],"itemType":2,"order":3},{"id":22428,"sectionId":8310,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"F1.10","name":"Assemble or install product","url":"/processes/fulfill/F1.10"},{"generatedExternalId":false,"externalId":"F1.11","name":"Obtain proof of delivery or customer acceptance","url":"/processes/fulfill/F1.11"},{"generatedExternalId":false,"externalId":"F2.11","name":"Assemble or install product","url":"/processes/fulfill/F2.11"},{"generatedExternalId":false,"externalId":"F2.12","name":"Obtain proof of delivery or customer acceptance","url":"/processes/fulfill/F2.12"},{"generatedExternalId":false,"externalId":"F3.10","name":"Assemble or install product","url":"/processes/fulfill/F3.10"},{"generatedExternalId":false,"externalId":"F3.11","name":"Obtain proof of delivery or customer acceptance","url":"/processes/fulfill/F3.11"}],"itemType":2,"order":3},{"id":22551,"sectionId":8372,"title":"Data collection","data":"Data for the components that are used to drive the calculation of this metric are taken from the Order, Source, Transfer and Fulfill process elements.
","itemType":1,"order":3},{"id":22558,"sectionId":8373,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"P2","name":"Plan Order","url":"/processes/plan/P2"},{"generatedExternalId":false,"externalId":"O1","name":"Order B2C","url":"/processes/order/O1"},{"generatedExternalId":false,"externalId":"O2","name":"Order B2B","url":"/processes/order/O2"},{"generatedExternalId":false,"externalId":"O3","name":"Order Intra-company","url":"/processes/order/O3"}],"itemType":2,"order":3},{"id":22562,"sectionId":8374,"title":"Discussion","data":"Level-3 metrics that are used to drive the calculation of Source Cycle Time are taken from the applicable Source process elements, depending on the possible strategies deployed by companies to fulfill orders (such as make-to-stock (MTS), make-to-order (MTO) or engineer-to-order). When an MTS or MTO strategy is deployed, the metrics Identify Sources of Supply Cycle Time (RS.3.7) and Select Supplier and Negotiate Cycle Time (RS.3.10) are not used in the calculation.
","itemType":1,"order":3},{"id":22568,"sectionId":8375,"title":"Discussion","data":"Level-3 metrics that are used to drive the calculation of Transform Cycle Time are taken from the applicable Transform process elements, depending on the possible strategies deployed by companies to fulfill orders (such as make-to-stock (MTS), make-to-order (MTO) or engineer-to-order (ETO)). When an MTS or MTO strategy is deployed, the metric Finalize Production Engineering Cycle Time (RS.3.13) is not used in the calculation. In addition, the data for the calculation of level-3 metrics may depend on different make strategies. For example, when an MTS strategy is deployed, the metric Issue Material Cycle Time (RS.3.14) refers to the time for issuing material, but when an MTO or ETO strategy is deployed, it refers to the cycle time for issuing sourced or in-process product.
In Transform Cycle Time, there may be overlaps in the processes, so the least amount of time should be applied, rather than the total sum.
","itemType":1,"order":3},{"id":22574,"sectionId":8376,"title":"Discussion","data":"Level-3 metrics that are used to drive the calculation of Fulfill Cycle Time are taken from the applicable Fulfill process elements, depending on the possible strategies deployed by companies to fulfill orders (such as make-to-stock (MTS), make-to-order (MTO) or engineer-to-order (ETO)). When an MTS or MTO strategy is deployed, the optional metric Schedule Installation Cycle Time (RS.3.27) is not used in the calculation.
","itemType":1,"order":3},{"id":22580,"sectionId":8377,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"P6","name":"Plan Return","url":"/processes/plan/P6"},{"generatedExternalId":false,"externalId":"R1","name":"Return Product","url":"/processes/return/R1"},{"generatedExternalId":false,"externalId":"R2","name":"Return Service","url":"/processes/return/R2"},{"generatedExternalId":false,"externalId":"R3","name":"Return MRO","url":"/processes/return/R3"}],"itemType":2,"order":3},{"id":22809,"sectionId":8497,"title":"Data collection","data":"Strategic agility measures are assumptions based on master data lead time assumptions located in your system of record. Operational agility measures compare new volume plans to original plans of record.
","itemType":1,"order":3},{"id":22816,"sectionId":8498,"title":"Discussion","data":"Deliver: Input
Listed below are the current elements needed to fully understand future requirements and determine the sustainable percentage increase in quantities delivered that can be achieved within 30 days. These elements are mainly output metrics from other attributes (Reliability, Responsiveness, Cost and Asset Management) and include
Deliver: Resource availability assessment and ramp-up or lead time
Listed below are the current elements needed to establish delta in resources and determine the sustainable percentage increase in quantities delivered that can be achieved within 30 days. These elements relate to staffing, capital, materials, cycle time and demand and include
Source: Input
Listed below are the current elements needed to fully understand future requirements and to establish the sustainable percentage increase in quantities sourced the company can achieve within 30 days. These elements, which are mainly output metrics from other attributes (Reliability, Responsiveness, Cost and Asset Management), include
Source: Resource availability assessment and ramp-up or lead time
Listed below are the current elements needed to establish the delta in resources and determine the sustainable percentage increase in quantities sourced that the company can achieve within 30 days. These elements relate to staffing, capital, materials, cycle time and demand considerations and include
Make: Input
Listed below are the current elements needed to fully understand future requirements and determine the sustainable percentage increase in quantities produced that can be achieved within 30 days. These elements, which are mainly output metrics from other attributes (Reliability, Responsiveness, Cost and Asset Management), include
Make: Resource availability assessment and ramp-up or lead time
Listed below are the current elements needed to establish the delta in resources and determine the sustainable percentage increase in quantities produced that the company can achieve within 30 days. These elements relate to staffing, capital, materials, cycle time and demand considerations and include
Deliver: Input
Listed below are the current elements needed to fully understand future requirements and determine the sustainable percentage increase in quantities delivered that can be achieved within 30 days. These elements are mainly output metrics from other attributes (Reliability, Responsiveness, Cost and Asset Management) and include
Deliver: Resource availability assessment and ramp-up or lead time
Listed below are the current elements needed to establish delta in resources and determine the sustainable percentage increase in quantities delivered that can be achieved within 30 days. These elements relate to staffing, capital, materials, cycle time and demand and include
Source Return: Input
Listed below are the current elements needed to fully understand future requirements and to determine the sustainable percentage increase in quantities returned to suppliers that can be supported within 30 days. These elements are mainly output metrics from other attributes (Reliability, Responsiveness, Cost and Asset Management), assume no supplier constraints and include
Demand
Source Return: Resource availability assessment and ramp-up or lead time
Listed below are the current elements needed to establish delta in resources and determine the sustainable percentage increase in quantities returned to suppliers that can be supported within 30 days. These elements relate to staffing, capital, materials, cycle time and demand; assume no supplier constraints; and include
Advanced VaR calculation: More accurate measures of VaR can be attained by applying more complex calculations, distributions and confidence intervals that use distributions and confidence intervals.
","itemType":1,"order":3},{"id":22871,"sectionId":8518,"title":"Data collection","data":"Resource expenses, such as salaries and supplies, initially are captured in the organization’s general ledger accounting system. Then these expenses are traced and assigned to the organization’s horizontal core processes based on employee time and non-wage-related factors, such as number of units consumed. Data for these expense distribution assignments is collected from employee time-collection systems and operational systems, such as enterprise resources planning systems.
","itemType":1,"order":3},{"id":22879,"sectionId":8519,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE5","name":"Human Resources","url":"/processes/orchestrate supply chain/OE5"},{"generatedExternalId":false,"externalId":"T","name":"Transform","url":"/processes/transform/T"}],"itemType":2,"order":3},{"id":22883,"sectionId":8520,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.187","name":"Supply Chain Finance","url":"/practices/best practices by category/BP.187"}],"itemType":2,"order":3},{"id":22886,"sectionId":8521,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.035","name":"Business Rule Review","url":"/practices/best practices by category/BP.035"},{"generatedExternalId":false,"externalId":"BP.098","name":"Mobile Access of Information","url":"/practices/best practices by category/BP.098"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.145","name":"Supplier Collaboration","url":"/practices/best practices by category/BP.145"},{"generatedExternalId":false,"externalId":"BP.153","name":"Radio Frequency Identification (RFID)","url":"/practices/best practices by category/BP.153"},{"generatedExternalId":false,"externalId":"BP.162","name":"Long-Term Supplier Agreement or Partnership","url":"/practices/best practices by category/BP.162"},{"generatedExternalId":false,"externalId":"BP.163","name":"Supply Base Rationalization","url":"/practices/best practices by category/BP.163"},{"generatedExternalId":false,"externalId":"BP.165","name":"Convergence of SCOR with Lean and Six Sigma","url":"/practices/best practices by category/BP.165"},{"generatedExternalId":false,"externalId":"BP.183","name":"Integrated Business Planning (IBP)","url":"/practices/best practices by category/BP.183"},{"generatedExternalId":false,"externalId":"BP.184","name":"Scenario Planning","url":"/practices/best practices by category/BP.184"},{"generatedExternalId":false,"externalId":"BP.187","name":"Supply Chain Finance","url":"/practices/best practices by category/BP.187"},{"generatedExternalId":false,"externalId":"BP.190","name":"Robotic Process Automation","url":"/practices/best practices by category/BP.190"},{"generatedExternalId":false,"externalId":"BP.194","name":"Predictive Analytics","url":"/practices/best practices by category/BP.194"}],"itemType":2,"order":3},{"id":22889,"sectionId":8522,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.187","name":"Supply Chain Finance","url":"/practices/best practices by category/BP.187"}],"itemType":2,"order":3},{"id":22894,"sectionId":8524,"title":"Data collection","data":"Resource expenses, such as salaries and supplies, initially are captured in the organization’s general ledger accounting system. Then these expenses are traced and assigned to the organization’s horizonal core processes based on employee time and non-wage-related factors, such as number of units consumed. Data for these expense distribution assignments is collected from employee time-connection systems and operational systems, such as enterprise resources planning systems.
","itemType":1,"order":3},{"id":22901,"sectionId":8525,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"S2.1","name":"Establish order signal","url":"/processes/source/S2.1"},{"generatedExternalId":false,"externalId":"S3.1","name":"Establish order signal","url":"/processes/source/S3.1"}],"itemType":2,"order":3},{"id":22905,"sectionId":8526,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.141","name":"Pre-issued Return Authorization","url":"/practices/best practices by category/BP.141"},{"generatedExternalId":false,"externalId":"BP.167","name":"Electronic Returns Tracking","url":"/practices/best practices by category/BP.167"},{"generatedExternalId":false,"externalId":"BP.190","name":"Robotic Process Automation","url":"/practices/best practices by category/BP.190"}],"itemType":2,"order":3},{"id":22908,"sectionId":8527,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"}],"itemType":2,"order":3},{"id":22941,"sectionId":8555,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE1","name":"Supply Chain Strategy","url":"/processes/orchestrate supply chain/OE1"},{"generatedExternalId":false,"externalId":"OE3","name":"Performance and Continuous Improvement","url":"/processes/orchestrate supply chain/OE3"},{"generatedExternalId":false,"externalId":"OE4","name":"Data, Information, and Technology","url":"/processes/orchestrate supply chain/OE4"},{"generatedExternalId":false,"externalId":"OE6","name":"Contracts and Agreements","url":"/processes/orchestrate supply chain/OE6"},{"generatedExternalId":false,"externalId":"OE10","name":"Environment, Social, and Governance","url":"/processes/orchestrate supply chain/OE10"},{"generatedExternalId":false,"externalId":"OE11","name":"Enterprise Business Planning","url":"/processes/orchestrate supply chain/OE11"},{"generatedExternalId":false,"externalId":"OE13","name":"Circular Supply Chain Management","url":"/processes/orchestrate supply chain/OE13"},{"generatedExternalId":false,"externalId":"S","name":"Source","url":"/processes/source/S"}],"itemType":2,"order":3},{"id":22945,"sectionId":8556,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.185","name":"Cost of Quality Measurement","url":"/practices/best practices by category/BP.185"},{"generatedExternalId":false,"externalId":"BP.187","name":"Supply Chain Finance","url":"/practices/best practices by category/BP.187"}],"itemType":2,"order":3},{"id":22948,"sectionId":8557,"title":"Data collection","data":"Unlike other SCOR metrics, which have specific data requirements, typically all of the Cash-to-Cash Cycle Time source data already is captured by business operating systems, such as
As a result, the information is calculated by importing data from these systems and transforming the data into the prescribed analytics and information. The transformation is accomplished using business rules.
","itemType":1,"order":3},{"id":22955,"sectionId":8558,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE6","name":"Contracts and Agreements","url":"/processes/orchestrate supply chain/OE6"},{"generatedExternalId":false,"externalId":"OE11.1","name":"Align long-term financial plan with supply chain strategy","url":"/processes/orchestrate supply chain/OE11.1"},{"generatedExternalId":false,"externalId":"F2.9","name":"Invoice","url":"/processes/fulfill/F2.9"},{"generatedExternalId":false,"externalId":"F3.12","name":"Update ledger/ invoice","url":"/processes/fulfill/F3.12"}],"itemType":2,"order":3},{"id":22959,"sectionId":8559,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"AM.3.1","name":"Inventory Days of Supply — Raw Material","url":"/performance/assets/AM.3.1"},{"generatedExternalId":false,"externalId":"AM.3.2","name":"Inventory Days of Supply — Work in Process (WIP)","url":"/performance/assets/AM.3.2"},{"generatedExternalId":false,"externalId":"AM.3.3","name":"Percentage of Defective Inventory","url":"/performance/assets/AM.3.3"},{"generatedExternalId":false,"externalId":"AM.3.4","name":"Percentage of Excess Inventory","url":"/performance/assets/AM.3.4"},{"generatedExternalId":false,"externalId":"AM.3.5","name":"Inventory Days of Supply — Finished Goods","url":"/performance/assets/AM.3.5"}],"itemType":2,"order":3},{"id":22964,"sectionId":8560,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE6","name":"Contracts and Agreements","url":"/processes/orchestrate supply chain/OE6"},{"generatedExternalId":false,"externalId":"S1","name":"Strategic Source","url":"/processes/source/S1"},{"generatedExternalId":false,"externalId":"S1.10","name":"Negotiate and award contract","url":"/processes/source/S1.10"},{"generatedExternalId":false,"externalId":"S2","name":"Direct Procure","url":"/processes/source/S2"},{"generatedExternalId":false,"externalId":"S2.7","name":"Authorize supplier payment","url":"/processes/source/S2.7"},{"generatedExternalId":false,"externalId":"S3","name":"Indirect Procure","url":"/processes/source/S3"},{"generatedExternalId":false,"externalId":"S4","name":"Source Return","url":"/processes/source/S4"}],"itemType":2,"order":3},{"id":22968,"sectionId":8561,"title":"Data collection","data":"Unlike other SCOR metrics, which have specific data requirements, typically all of the Return on Supply Chain Fixed Assets source data already is captured by business operating systems, such as
As a result, the information is calculated by importing data from these systems and transforming the data into the prescribed analytics and 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 a supply chain fixed asset is. Manage Supply Chain Assets (sE5) is used here because it is focused on managing supply chain capital assets. The value of these assets is the denominator of this metric.
","itemType":1,"order":3},{"id":22975,"sectionId":8562,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.024","name":"Supply Chain Optimization (SCO)","url":"/practices/best practices by category/BP.024"},{"generatedExternalId":false,"externalId":"BP.027","name":"Pull-Based Inventory Replenishment","url":"/practices/best practices by category/BP.027"},{"generatedExternalId":false,"externalId":"BP.028","name":"Inventory Optimization","url":"/practices/best practices by category/BP.028"},{"generatedExternalId":false,"externalId":"BP.029","name":"Network Optimization","url":"/practices/best practices by category/BP.029"},{"generatedExternalId":false,"externalId":"BP.030","name":"Inventory Record Accuracy","url":"/practices/best practices by category/BP.030"},{"generatedExternalId":false,"externalId":"BP.031","name":"Stock Keeping Unit (SKU) Rationalization and Cost of Sales Analysis","url":"/practices/best practices by 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category/BP.047"},{"generatedExternalId":false,"externalId":"BP.048","name":"Demand Shaping","url":"/practices/best practices by category/BP.048"},{"generatedExternalId":false,"externalId":"BP.052","name":"Design for Logistics (DFL) Management","url":"/practices/best practices by category/BP.052"},{"generatedExternalId":false,"externalId":"BP.053","name":"Manufacturing Reliability Improvement","url":"/practices/best practices by category/BP.053"},{"generatedExternalId":false,"externalId":"BP.054","name":"Manufacturing Quality Improvements for Return Reduction","url":"/practices/best practices by category/BP.054"},{"generatedExternalId":false,"externalId":"BP.055","name":"Freight Carrier Delivery Performance Evaluation","url":"/practices/best practices by category/BP.055"},{"generatedExternalId":false,"externalId":"BP.056","name":"Supplier Raw Material Quality Assurance","url":"/practices/best practices by 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Reduction","url":"/practices/best practices by category/BP.067"},{"generatedExternalId":false,"externalId":"BP.069","name":"Raw Materials Receiving Process","url":"/practices/best practices by category/BP.069"},{"generatedExternalId":false,"externalId":"BP.070","name":"Planning and Scheduling Inventory Training","url":"/practices/best practices by category/BP.070"},{"generatedExternalId":false,"externalId":"BP.071","name":"Modal Optimization","url":"/practices/best practices by category/BP.071"},{"generatedExternalId":false,"externalId":"BP.089","name":"Perfect Pick Put-Away","url":"/practices/best practices by category/BP.089"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.191","name":"Artificial Intelligence","url":"/practices/best practices by category/BP.191"},{"generatedExternalId":false,"externalId":"BP.192","name":"Big Data Analytics","url":"/practices/best practices by category/BP.192"},{"generatedExternalId":false,"externalId":"BP.201","name":"Dynamic Inventory Management","url":"/practices/best practices by category/BP.201"}],"itemType":2,"order":3},{"id":22978,"sectionId":8563,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.024","name":"Supply Chain Optimization (SCO)","url":"/practices/best practices by category/BP.024"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.130","name":"Identification of Obsolete Capital Assets","url":"/practices/best practices by category/BP.130"},{"generatedExternalId":false,"externalId":"BP.190","name":"Robotic Process Automation","url":"/practices/best practices by category/BP.190"}],"itemType":2,"order":3},{"id":22981,"sectionId":8564,"title":"Data collection","data":"Unlike other SCOR metrics, which have specific data requirements, typically all of the Return on Working Capital source data already is captured by business operating systems, such as
As a result, the information is calculated by importing data from these systems and transforming the data into the prescribed analytics and information. The transformation is accomplished using business rules.
","itemType":1,"order":3},{"id":22988,"sectionId":8565,"title":"Notes","data":"The five-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 of both the four previous quarters and the projection for the current or next quarter.
The five-point rolling average calculation is (Sum of the four previous quarters + Projection for the current or next quarter) / 5.
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Management (CRM)","url":"/people/skills/HS.0029"},{"generatedExternalId":false,"externalId":"HS.0032","name":"Customer or Supplier Communication","url":"/people/skills/HS.0032"},{"generatedExternalId":false,"externalId":"HS.0181","name":"Negotiation","url":"/people/skills/HS.0181"},{"generatedExternalId":false,"externalId":"HS.0184","name":"Reconciliation","url":"/people/skills/HS.0184"}],"itemType":2,"order":4},{"id":22361,"sectionId":8296,"title":"Discussion","data":"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 defined as a collection of one or more order lines representing a request to deliver specified quantities of goods or to render specific services. The order can further be defined as a request (with a specific identifier as a reference) to deliver specified items or to render specific services with specific prices, on specific dates and in specific quantities. Commitments are made to a customer at the order line level. An order line is defined as a line representing a commitment on a sales order, and it always references a product or service.
Orders canceled by the customer are excluded from this 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 for product issues), 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 specified is satisfied.
The term customer ready for the perfect condition standard may imply a subjective component based on the customer’s satisfaction. Although condition may not be as rigorously measured as time or quantity, it should be considered as a component if it is available, especially because 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 supplier’s ability to source products.
","itemType":1,"order":4},{"id":22368,"sectionId":8297,"title":"Hierarchy","data":[{"generatedExternalId":false,"externalId":"RL.3.1","name":"Delivery Item Accuracy to the Customer","url":"/performance/reliability/RL.3.1"},{"generatedExternalId":false,"externalId":"RL.3.2","name":"Delivery Quantity Accuracy to the Customer","url":"/performance/reliability/RL.3.2"}],"itemType":2,"order":4},{"id":22374,"sectionId":8298,"title":"Discussion","data":"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 defined in the customer’s service-level agreement. Orders canceled by the customer are excluded from this 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. This metric has no in-full element, which means that partial deliveries can still be considered as meeting the customer commit date as long as all metric criteria are met. In addition, measuring the frequency of accepting the customer’s original request date versus negotiating a commit date can be an important measure of customer satisfaction. Several diagnostic metrics exist that can be used to focus delivery performance improvement efforts. Some of these include
Orders may not be delivered to the customer commit date because of breakdowns in the order-fulfillment and shipment process, such as inadequate transportation availability. Orders also may be delivered late because of carrier delivery performance issues.
","itemType":1,"order":4},{"id":22381,"sectionId":8299,"title":"Discussion","data":"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 because of an inability to prepare and process the correct documentation on time. Inaccurate or late shipping documentation may prevent the product from being loaded or shipped, increase the customs delay, and delay the customer’s acceptance of the order. Inaccurate or late invoices also may lead to the inability to fulfill the customer request.
This metric’s definition 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.
","itemType":1,"order":4},{"id":22388,"sectionId":8300,"title":"Discussion","data":"This metric, calculated at the order level, assesses the quality of products delivered through the supply chain from the customer’s perspective. Justified and non-justified 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 Customer Order Perfect Condition improvement efforts, including Warranty Costs (RL.3.52) and Yield Variability (RL.3.55).
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category/BP.325"},{"generatedExternalId":false,"externalId":"BP.331","name":"Account Management","url":"/practices/best practices by category/BP.331"},{"generatedExternalId":false,"externalId":"BP.332","name":"Sales Process/Activity Management","url":"/practices/best practices by category/BP.332"},{"generatedExternalId":false,"externalId":"BP.333","name":"Quotation Management","url":"/practices/best practices by category/BP.333"}],"itemType":2,"order":4},{"id":22429,"sectionId":8310,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.089","name":"Perfect Pick Put-Away","url":"/practices/best practices by category/BP.089"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.147","name":"Receiving Goods Inspection","url":"/practices/best practices by category/BP.147"}],"itemType":2,"order":4},{"id":22552,"sectionId":8372,"title":"Discussion","data":"The order fulfillment cycle time as captured from the moment a customer places the order to the moment the order is fulfilled 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 value-added or non-value-added activities performed by the organization to fulfill the order or dwell time because the order was placed well in advance by the customer. As such, this gross order fulfillment cycle time does not truly reflect the responsiveness of the organization. For example, if an organization needs six days to fulfill a certain customer order but the customer places the order 14 days before the desired fulfillment date, the gross order fulfillment cycle time will be 14 days. However, the fact that the customer preorders 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 because it allows the organization to plan ahead and fulfill 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 fulfill the order, but this should exclude any dwell time where no activity takes place. Therefore, the definition of Customer Order Fulfillment Cycle Time consists of a gross component and a net component named Order Fulfillment Process Time, according to the following formula: Customer Order Fulfillment Cycle Time = Customer Order Fulfillment Process Time + Order Fulfillment Dwell Time (RS.3.97). Note that dwell time will equal zero for companies that do not utilize this metric, so Customer Order Fulfillment Cycle Time will equal Customer Order Fulfillment Process Time.
Order fulfillment dwell time is defined as any lead time created by the customer during the order fulfillment process during which no activity takes place. Note that this dwell time is different from idle time or non-value-added lead time, which are caused by inefficiencies in the organization's processes and therefore ultimately under responsibility of the organization. These kinds of timeframes should not be deducted from the gross order fulfillment cycle time.
Dwell time mostly is associated with instances when a customer places an order in advance to reserve capacity or materials, but the actual order fulfillment steps do not need to take place until later. It also is common in the delivery process when the organization may be ready to ship the product or service but the customer requests that the organization wait and follow a certain shipment schedule.
For benchmarking purposes, it is recommended to use Order Fulfillment Process Time because this is the measurement of cycle time that most accurately reflects the responsiveness of an organization. Using this measurement also will ensure that 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 also to all lower-level metrics. This means that each lower-level metric can have a gross component, which consists of the net component and dwell time. Because the lower-level metrics are hierarchical (meaning 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 be equal to the dwell time at level 1.
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Total Supply Chain Management Cost is measured in monetary units.
","itemType":1,"order":4},{"id":22880,"sectionId":8519,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.129","name":"Return Policy Included with Shipping Document","url":"/practices/best practices by category/BP.129"},{"generatedExternalId":false,"externalId":"BP.141","name":"Pre-issued Return Authorization","url":"/practices/best practices by category/BP.141"}],"itemType":2,"order":4},{"id":22895,"sectionId":8524,"title":"Discussion","data":"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-effect relationships without the temptation of using broad averages or arbitrary factors.
","itemType":1,"order":4},{"id":22902,"sectionId":8525,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.193","name":"Should Cost Modeling","url":"/practices/best practices by category/BP.193"}],"itemType":2,"order":4},{"id":22942,"sectionId":8555,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.160","name":"Lean","url":"/practices/best practices by category/BP.160"},{"generatedExternalId":false,"externalId":"BP.185","name":"Cost of Quality Measurement","url":"/practices/best practices by category/BP.185"},{"generatedExternalId":false,"externalId":"BP.187","name":"Supply Chain Finance","url":"/practices/best practices by category/BP.187"},{"generatedExternalId":false,"externalId":"BP.211","name":"Fleet Management","url":"/practices/best practices by category/BP.211"},{"generatedExternalId":false,"externalId":"BP.266","name":"Total Cost of Ownership Analysis","url":"/practices/best practices by category/BP.266"},{"generatedExternalId":false,"externalId":"BP.267","name":"Price Analysis","url":"/practices/best practices by category/BP.267"},{"generatedExternalId":false,"externalId":"BP.268","name":"Purchase Price Cost Analysis","url":"/practices/best practices by category/BP.268"}],"itemType":2,"order":4},{"id":22949,"sectionId":8557,"title":"Discussion","data":"Cash-to-Cash Cycle Time is a value metric used to measure how efficiently 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 first element of Cash-to-Cash Cycle, inventory days of supply, is measured by converting the supply of inventory in stock into number of days of supply. This value 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. The longer the cash-to-cash cycle, the more current assets needed (relative to current liabilities) because it takes longer to convert inventories and receivables into cash. In other words, the longer the cash-to-cash cycle, the more net working capital required.
","itemType":1,"order":4},{"id":22956,"sectionId":8558,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"}],"itemType":2,"order":4},{"id":22960,"sectionId":8559,"title":"Processes","data":[{"generatedExternalId":false,"externalId":"OE7","name":"Network Design","url":"/processes/orchestrate supply chain/OE7"},{"generatedExternalId":false,"externalId":"OE7.2","name":"Gather inputs and data","url":"/processes/orchestrate supply chain/OE7.2"},{"generatedExternalId":false,"externalId":"OE7.3","name":"Develop scenarios","url":"/processes/orchestrate supply chain/OE7.3"},{"generatedExternalId":false,"externalId":"OE7.4","name":"Model and simulate scenarios","url":"/processes/orchestrate supply chain/OE7.4"},{"generatedExternalId":false,"externalId":"OE7.5","name":"Calculate and assess impact projections","url":"/processes/orchestrate supply chain/OE7.5"},{"generatedExternalId":false,"externalId":"OE11.1","name":"Align long-term financial plan with supply chain strategy","url":"/processes/orchestrate supply chain/OE11.1"},{"generatedExternalId":false,"externalId":"OE12","name":"Segmentation","url":"/processes/orchestrate supply chain/OE12"},{"generatedExternalId":false,"externalId":"P1.2","name":"Aggregate supply chain requirements","url":"/processes/plan/P1.2"},{"generatedExternalId":false,"externalId":"P1.3","name":"Assess and create supply response","url":"/processes/plan/P1.3"},{"generatedExternalId":false,"externalId":"P1.4","name":"Balance external market signals, supply chain requirements, and supply chain response using supply chain modeling techniques","url":"/processes/plan/P1.4"},{"generatedExternalId":false,"externalId":"P1.5","name":"Replan, analyze, and select optimal supply chain response","url":"/processes/plan/P1.5"},{"generatedExternalId":false,"externalId":"P1.6","name":"Communicate plan to execution functions and evaluate","url":"/processes/plan/P1.6"},{"generatedExternalId":false,"externalId":"P3.2","name":"Assess and create initial source response","url":"/processes/plan/P3.2"},{"generatedExternalId":false,"externalId":"P3.3","name":"Balance requirements and source response","url":"/processes/plan/P3.3"},{"generatedExternalId":false,"externalId":"P4.2","name":"Assess and create initial transform response","url":"/processes/plan/P4.2"},{"generatedExternalId":false,"externalId":"P4.3","name":"Balance requirements and transform response","url":"/processes/plan/P4.3"},{"generatedExternalId":false,"externalId":"P5.2","name":"Assess and create initial fulfillment response","url":"/processes/plan/P5.2"},{"generatedExternalId":false,"externalId":"P5.3","name":"Balance requirements and fulfillment response","url":"/processes/plan/P5.3"},{"generatedExternalId":false,"externalId":"P6.2","name":"Assess and create initial return response","url":"/processes/plan/P6.2"},{"generatedExternalId":false,"externalId":"P6.3","name":"Balance requirements and return response","url":"/processes/plan/P6.3"},{"generatedExternalId":false,"externalId":"S2.6","name":"Transfer product","url":"/processes/source/S2.6"},{"generatedExternalId":false,"externalId":"S3.6","name":"Transfer product","url":"/processes/source/S3.6"}],"itemType":2,"order":4},{"id":22965,"sectionId":8560,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.005","name":"Self-Invoicing","url":"/practices/best practices by category/BP.005"},{"generatedExternalId":false,"externalId":"BP.024","name":"Supply Chain Optimization (SCO)","url":"/practices/best practices by category/BP.024"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.148","name":"3-Way Delivery Verification","url":"/practices/best practices by category/BP.148"}],"itemType":2,"order":4},{"id":22969,"sectionId":8561,"title":"Discussion","data":"Return on Supply Chain Fixed Assets is measured by monetizing the supply chain revenue and subtracting from this value the Cost of Goods Sold (COGS) (CO.1.2) and other supply chain management costs to determine the profit from the respective supply chain. This amount is divided by the supply chain fixed assets to determine the return generated from the respective supply chain.
Supply Chain Revenue is used in this metric rather than just net revenue, which is not specific enough for this purpose because it also could include revenue from sources other than the supply chain, such as leased real estate, investments, court settlements or sales of office buildings. Supply Chain Revenue includes only the portion of net revenue that is generated by the specific supply chain being measured and analyzed. It also includes fixed assets in the organization that have a character of permanency, such as land, warehouses, trucks, buildings, investments, other facilities and machinery.
Fixed assets used to operate the supply chain in each of the process areas, Plan, Source, Make, Deliver Return and Enable, are managed by the process Manage Supply Chain Assets. A revised capital plan is an output of this process and contains supply chain capital asset information that could be used in measuring the Supply Chain Fixed Assets value.
","itemType":1,"order":4},{"id":22982,"sectionId":8564,"title":"Discussion","data":"The return on working capital is measured by monetizing the supply chain profit and dividing that by the supply chain working capital position. Supply Chain Revenue is used in this metric rather than just net revenue, which is not specific enough for this purpose because it also could include revenue from sources other than the supply chain, such as leased real estate, investments, court settlements or sales of office buildings. Supply Chain Revenue includes only the portion of net revenue that is generated by the specific supply chain being measured and analyzed.
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","itemType":1,"order":8},{"id":20995,"sectionId":7980,"title":"Cost","data":"The Cost attribute describes the cost of operating the supply chain process and includes bost direct and indirect expenses. Typical costs include labor, materials, systems, and transportation costs. The SCOR key performance indicators for Cost are Total Supply Chain Management Cost (CO.1.1) and Cost of Goods Sold (COGS) (CO.1.2). Cost is an economic focused attribute.
","itemType":1,"order":8},{"id":22876,"sectionId":8518,"title":"Practices","data":[{"generatedExternalId":false,"externalId":"BP.002","name":"Risk Management Strategies","url":"/practices/best practices by category/BP.002"},{"generatedExternalId":false,"externalId":"BP.086","name":"Supply Network Planning","url":"/practices/best practices by category/BP.086"},{"generatedExternalId":false,"externalId":"BP.092","name":"Balance and Firm within Horizon","url":"/practices/best practices by category/BP.092"},{"generatedExternalId":false,"externalId":"BP.126","name":"Supply Chain Control Towers","url":"/practices/best practices by category/BP.126"},{"generatedExternalId":false,"externalId":"BP.161","name":"Spend Analysis","url":"/practices/best practices by category/BP.161"},{"generatedExternalId":false,"externalId":"BP.165","name":"Convergence of SCOR with Lean and Six Sigma","url":"/practices/best practices by category/BP.165"},{"generatedExternalId":false,"externalId":"BP.178","name":"Blockchain","url":"/practices/best practices by category/BP.178"},{"generatedExternalId":false,"externalId":"BP.180","name":"Demand-Driven Sales and Operations Planning (DDS&OP)","url":"/practices/best practices by category/BP.180"},{"generatedExternalId":false,"externalId":"BP.182","name":"Internet of Things (IoT)","url":"/practices/best practices by category/BP.182"},{"generatedExternalId":false,"externalId":"BP.183","name":"Integrated Business Planning (IBP)","url":"/practices/best practices by category/BP.183"},{"generatedExternalId":false,"externalId":"BP.184","name":"Scenario Planning","url":"/practices/best practices by category/BP.184"},{"generatedExternalId":false,"externalId":"BP.189","name":"Augmented Reality","url":"/practices/best practices by category/BP.189"},{"generatedExternalId":false,"externalId":"BP.190","name":"Robotic Process Automation","url":"/practices/best practices by category/BP.190"},{"generatedExternalId":false,"externalId":"BP.193","name":"Should Cost Modeling","url":"/practices/best practices by category/BP.193"},{"generatedExternalId":false,"externalId":"BP.200","name":"Stocktaking by Drones","url":"/practices/best practices by category/BP.200"},{"generatedExternalId":false,"externalId":"BP.207","name":"Multi-Enterprise Business Networks","url":"/practices/best practices by category/BP.207"},{"generatedExternalId":false,"externalId":"BP.212","name":"Smart Factory","url":"/practices/best practices by category/BP.212"},{"generatedExternalId":false,"externalId":"BP.238","name":"Negotiations Planning","url":"/practices/best practices by category/BP.238"},{"generatedExternalId":false,"externalId":"BP.250","name":"Supplier Credit Check","url":"/practices/best practices by category/BP.250"},{"generatedExternalId":false,"externalId":"BP.251","name":"Category Management","url":"/practices/best practices by category/BP.251"},{"generatedExternalId":false,"externalId":"BP.257","name":"Outsourcing","url":"/practices/best practices by category/BP.257"},{"generatedExternalId":false,"externalId":"BP.258","name":"Open Tendering","url":"/practices/best practices by category/BP.258"},{"generatedExternalId":false,"externalId":"BP.259","name":"Restricted Tendering","url":"/practices/best practices by category/BP.259"},{"generatedExternalId":false,"externalId":"BP.260","name":"Reverse Auction","url":"/practices/best practices by category/BP.260"},{"generatedExternalId":false,"externalId":"BP.266","name":"Total Cost of Ownership Analysis","url":"/practices/best practices by category/BP.266"},{"generatedExternalId":false,"externalId":"BP.288","name":"Life Cycle Assessment","url":"/practices/best practices by category/BP.288"},{"generatedExternalId":false,"externalId":"BP.291","name":"Energy Efficiency Management","url":"/practices/best practices by category/BP.291"},{"generatedExternalId":false,"externalId":"BP.292","name":"Water efficiency Management","url":"/practices/best practices by category/BP.292"},{"generatedExternalId":false,"externalId":"BP.295","name":"Emission reduction","url":"/practices/best practices by category/BP.295"},{"generatedExternalId":false,"externalId":"BP.296","name":"Carbon removal/offsetting","url":"/practices/best practices by category/BP.296"},{"generatedExternalId":false,"externalId":"BP.327","name":"Online order processing","url":"/practices/best practices by category/BP.327"},{"generatedExternalId":false,"externalId":"BP.328","name":"Online order configurability","url":"/practices/best practices by category/BP.328"}],"itemType":2,"order":8},{"id":20987,"sectionId":7979,"title":"Levels","data":"For each level-1 process, three or more differentiating level-2 processes exist. Each level-2 process contains level-3 process elements. These hierarchical relationships provide process classification.
When conducting a SCOR project, SCOR users may decide to move some lower-level processes, such as those involving sourcing, delivery, and procurement, into other Process sections. SCOR can serve as a flexible and customizable model that can be applied to multiple industries and situations, so the framework process locations are not rigid. If this is done, SCOR users should be careful not to duplicate processes.
","itemType":1,"order":9},{"id":20996,"sectionId":7980,"title":"Profit","data":"The Profit attribute describes the financial margin realized when revenue generated from a business activity exceeds the expenses, costs, and taxes involved in sustaining the activity. The SCOR key performance indicators for Profit are Earnings Before Interest and Taxes (EBIT) as a Percent of Revenue (PR.1.1) and Effective Tax Rate (PR.1.2). Profit is an economic focused attribute.
","itemType":1,"order":9},{"id":20997,"sectionId":7980,"title":"Assets","data":"The Assets attribute describes the ability to efficiently utilize assets as both fixed and working. Assets strategies in supply chain include inventory reduction and insourcing rather than outsourcing. Example metrics include Inventory Days of Supply (AM.2.2) and Capacity Utilization (AM.3.9). The SCOR key performance indicators for Assets are Cash-to-Cash Cycle Time (AM.1.1), Return on Supply Chain Fixed Assets (AM.1.2) and Return on Working Capital (AM.1.3). Assets is an economic focused attribute.
","itemType":1,"order":10},{"id":20998,"sectionId":7980,"title":"Sustainability","data":"","itemType":1,"order":11},{"id":20999,"sectionId":7980,"title":"Environmental","data":"The Environmental attribute describes the ability to operate the supply chain with minimal environmental impact. The SCOR key performance indicators for Environmental are Materials Used (EV.1.1), Energy Consumed (EV.1.2), Water Consumed (EV.1.3), GHG Emissions (EV.1.4), and Waste Generated (EV.1.5). Environmental is a sustainability focused attribute.
","itemType":1,"order":12},{"id":21000,"sectionId":7980,"title":"Social","data":"The Social attribute describes the ability to operate the supply chain in alignment with the organization’s social values. The SCOR key performance indicators for Social are Diversity and Inclusion (SC.1.1), Wage level (SC.1.2), and Training (SC.1.3). Social is a sustainability focused attribute.
","itemType":1,"order":13},{"id":21001,"sectionId":7980,"title":"Metric","data":"A metric is a standard for measuring the performance of a supply chain or process. SCOR metrics are diagnostic metrics used to analyze a situation. SCOR recognizes three levels of predefined metrics:
The analysis of the performance of metrics from level 1 through 3 is referred to as metrics decomposition, performance diagnosis or metrics root cause analysis. Metrics decomposition is a first step in identifying the processes that need further investigation and identifying the root causes of issues. (Processes are linked to level-1, level-2, and level-3 metrics.)
SCOR recognizes 20 strategic metrics (level-1 metrics):
| Attribute | Level-1 Metric |
| Reliability | RL.1.1 Perfect Order Fulfillment RL.1.2 Perfect Supplier Order RL.1.3 Perfect Return Order Fulfilment |
| Responsiveness | RS.1.1 Order Fulfillment Cycle Time |
| Agility | AG.1.1 Supply Chain Agility |
| Cost | CO.1.1 Total Supply Chain Management CO.1.2 Cost of Goods Sold (COGS) |
| Profit | PR.1.1 Earnings Before Interest and Taxes (EBIT) as a Percent of Revenue PR.1.2 Effective Tax Rate |
| Assets | AM.1.1 Cash-to-Cash Cycle Time AM.1.2 Return on Fixed Assets AM.1.3 Return on Working Capital |
| Environmental | EV.1.1 Materials Used EV.1.2 Energy Consumed EV.1.3 Water Consumed EV.1.4 GHG Emissions EV.1.5 Waste Generated |
| Social | SC.1.1 Diversity and Inclusion SC.1.2 Wage Level SC.1.3 Training |
ASCM recommends that supply chain scorecards contain at least one metric for each performance attribute to ensure balanced decision-making and governance.
","itemType":1,"order":14},{"id":21002,"sectionId":7980,"title":"Process or Practice Maturity","data":"Research about supply chain performance has repeatedly shown a strong correlation between metrics performance and the effectiveness of supply chain processes, including the use of recognized best practices. The measurement of supply chain process and practice effectiveness follows widely used models for practice maturity (sometimes referred to as capability maturity models), which compare actual business activities to descriptive representations of different levels of process and practice adoption and implementation. High-maturity processes employ, and often extend, best practices and are implemented with a high degree of discipline and compliance. Low-maturity processes are characterized by outdated practices or a lack of discipline and consistency. Numerous maturity models exist for supply chain management, but they typically follow a five-stage maturity scale: