100927 principles and trends scmandb process management

8/8/2019 100927 Principles and Trends SCMandB Process Management

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Focused Consultancy, Measurable Benefits

www.mobius.eu

Principles and Trends inSupply Chain Management andBusiness Process Management

Amsterdam, 1 October, 2010

Prof. Dr. ir. Hendrik Vanmaele

[email protected]
mailto:[email protected]:[email protected]


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AGENDA

Supply Chain Management today

Process Organization

From Process Mapping to Business ProcessManagement

Corporate Performance Management

2


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Supply ChainDefinition

A supply chain contains these elements:

Suppliers deliver inflow of Raw materials / Intermediates / finished products

Goods for production or distribution Consume raw materials and supply chain resources

Clients consume OUTFLOW of Intermediates / finished products

Assets add value throughout the supply chain Production / Inventory / Transport

Organization a framework for planning and control

supplie

rs

client

s

Production Finishing Distribution

FORECAST INFORMATION

MATERIAL FLOW INFORMATION

ORDER INFORMATION


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Supply Chain Management is a framework for :

Managing all mentioned supply chain elements Providing information transparency throughout the supply chain

Planning and controlling business processes within the supply chain

With the objective to obtain : Agile, flexible and reliable satisfaction of market demand

Support for all the objectives of the organization

Continuous improvement of all processes Integrated optimization yielding better results than the local optimization of individual

processes

Suppliers

Clients

MATERIAL FLOW INFORMATION

FORECAST INFORMATION

ORDER INFORMATION

Supply Chain ManagementDefinition


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Supply Chain Management

Focus concepts : End-to-end process integration,

Information transparency and consolidation,

Segmentation based on requirements

Todays challenges Segment Focused supply chain solutions

Multi-echelon end-to-end supply chain optimization

Integrated planning approach

Product life cycle management

Strategy implementation (KPIs)

Collaborativeness (CPFR)


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SCM framework systems & processes

Master planning Rough Cut Capacity PlanDemand

PlanningPurchasing &

MRP

Production & distributionplanning

ATP & DemandFulfillment

Strategic Network Planning

Sales & Operations Planning

Scheduling Transport plan

At each level: determine priorities / control capacity / solve conflicts

Lang

term

Mid

term

Short

term

suppliers

Clients

Raw material Semi finished

finishedEDC

Production Finishing Distribution Sales

WIP WIP Transit

finishedRDC

Purchase

CODP

Network design Portfolio design


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Demand Managementgeneral process overview

Management interests

Supporting services

Core processes

Process Performance Management:

Performance & KPI reportingMgmt coordination:

S&OP CycleFinancial coordination:

Pricing & Payment terms

Organization

People in the Demand Management Team

Customer Portfolio Demand channels

Service setting

Article Portfolio Product generation planning Product lifecycle planning Product classification

Order promising& order execution

Influencing demand Proactive Reactive

FCST Consumption / ATP Order fulfillment

Systems and algorithms for demand Management

Demand Planning Demand Planning coordination

Generating the demand plan- sales judgments- forecasting- collaboration

Validating the demand plan Interaction with S&OP cycle Publishing the demand plan

- planning and MPS- management


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Overview

Statistical

FC

Market

Intell.

correction

Hierarch.

approval

Unconstr.

Sales

FC

S&OP

Preparation

Scenario

calculation

S&OP

meeting

Demand

&Supply

Plan

consensus

Consensus

Demand

& Supply

plan

Demand

&Supply

Plan

translation

Prod.

plan

Financial

Plan

Supply

previewSupply

analysis

Financial

preview

Data collection

& purification

Data collection

& purificationFinancial

analysis

S&OP cycle

Demand & Supply plan measurement

& reporting

Sales

planData collection

& purification

Demand

Supply

Finance

Sales and Operations Planninggeneral process overview


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AGENDA





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From a Functional towards a Process Oriented OrganisationTraditional Organization

Partner

Customer

Functional SILOs within organization

Characteristics

Limited process ownership (hierarchical management decides) High (uncontrollable) lead times

Non value adding activities (inefficiency, waste)

Limited integration with other partners

Isolated operational strategies

Limited economy of scales


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From a Functional towards a Process Oriented OrganizationProcess Oriented Organization

Customer

Partner

Characteristics

Quick response time : short and predictable lead times

High degree of accuracy

Integration with different partners (customer, supplier,)

Participative decision structure

Standardization of repetitive work

Integrated system / consolidated management of data

Optimal use of resources

Flexible organization


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Process Management

Business Process Management starts from the processes but has animpact on organization, manpower and ICT.

CRM


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Process Management as EnablerStrategic Context

Mission / Vision

Objectives

Processes/Projects

Performance indicators

Where are we going ?

What do we need toaccomplish to get there?

How can we accomplishthose objectives?

Are we accomplishing whatwe need to accomplish ?

data source

Who should ensure theseobjectives are being realized?


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Process Mapping and Design

Process design is the single definition of businessprocesses aiming at:

Initial effort to evolve to a process oriented organization.

Eliminating all activities without added value.

Supporting the introduction of new systems.

Applied techniques:

Graphical representation of the process by means of Flowcharts.

Data flow diagrams (input/output).

Result:

Process definitions with related flow charts and

procedures.


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Process Mapping and Design

P M


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Process ManagementIngredients

PROC

ORG

ISAON

IC

POP

Customer

P M


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Process ManagementIngredients - Organisation

D ep ar tm en t A D ep ar tm en t B

Process

ORGANISATION

Steering

Committee

werkgroepenNew Projects

Processes

Implementation

& Monitor ing

Prioritize,decide,manage

(Lean) Daily

Management

Proj ect Plans

BPM Prog ram Off iceManagement

Process Mgr

ProcessCoordinator

Process Own ers


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What is performance measurement ?A definition

What is performance measurement ?

Theprocessof developingmeasurable indicatorsthat canbe systematically tracked to assess progress made in achievingpredeterminedgoalsand using such indicators to assess

progress in achieving these goals

The process that supports thedecision makingprocess bygenerating indicators of how well the () system is achieving thedesired or expected outcomes

Financial andnon-financialcomprehensive manner tomonitor organisational progress

S i i h h


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Starting with the strategyObjectives

Objectives link the mission/vision to the desiredresults

Strategicobjectives

Operationalobjectives

Critical success factors

What is our ambition ?What are our long term goals ?

How will we realize them ?

What do we need to do ?

S i i h h


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Starting with the strategyObjectives

Objectives should be SMART to be effective

Specific: precise about what has to be achieved

Measurable: clear on how to quantify the realization of the

objective

Agreed or achievable: realistic expectations

Relevant: to the organization and to whom it is assigned

Time-based: start or finish date

T l ti t t i t ti


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Translating strategy into actionProcesses and projects

Strategy does not realize itself, initiatives are necessary

Initiatives consists of activities that transform inputs into outputwhich realize a certain effect

Initiatives take the shape of:

permanent activities (processes)

temporary activities (projects)

Organizations start with a given set of projects and processes:

Are we doing what we should be doing ?

Is what were doing, what we should be doing?

Inputs Activities Outputs Effects

D fi i f i di


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Defining performance indicatorsWhat are performance indicators ?

Performance indicators are numerical representations of

phenomena that should be controlled

Performance indicators are derived from objectives

They measure the degree of realization of an objective

Performance indicators quantify phenomena

They can take different shapes Numbers

Rankings

Categories (Yes /No)

Different ways exist for measuring the data

Observe

Extract from a recording

Ask

D fi i f i di t


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Defining performance indicatorsGolden rules

Criteria for a good performance indicator Does it measure the objective

Does it measure team rather than individual performance

Can it be translated into action

Does it have a clear polarity

Do we have a mix of leading and lagging indicators

Can we avoid unwanted effects or manipulation

Does the value of the information outweigh the effort of collecting it

B l d d


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Balanced scorecard2nd generation balanced scorecard: Strategy maps

Defining how the organization will distinguish itself in order to

realize its mission/vision


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Q & A

100927 principles and trends scmandb process management

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