Supply Chain Matters had the opportunity to chat with John Sells who is the recently elected Chairman, board of directors for the Supply Chain Council (SCC).

John’s day-to-day responsibilities involve his role as Senior Manager, Logistics and Sustainment at Lockheed Martin Corporation, focusing on corporate engineering, technology and performance based logistics.  We have had the opportunity to interview the chairs of SCC in the past, and wanted to also check-in with John regarding the thrust of SCC in the coming months.

For those readers unfamiliar with SCC, it is a global nonprofit organization whose methodology, diagnostic, and benchmarking tools help nearly a thousand organizations make dramatic and rapid improvements in their supply chain processes.  SCC is most associated with the creation and ongoing maturity of the Supply Chain Operations Reference (SCOR®) model which helps organizations determine and compare the performance of supply chain and related operations within their company or against other organizations.

In our interview, we touched upon a number of different areas. Because of the length of content, we divided the output of this interview into two separate postings.  This part one posting will share our interview exchange covering the first three questions.  Part two will share the remaing three questions.

Question: Could you briefly describe your past history with the Council and what led you to seek a board leadership role?

John’s involvement started some time ago and was specifically focused on the unique supply chain process challenges that are prevalent in aerospace and defense-oriented supply chain processes.  John joined with others to form a special interest group focused specifically on these unique industry needs, and worked with the team to develop a SCOR curriculum that was tailored to this industry.  An important consideration was incorporating concepts of performance based logistics within the SCOR framework.

John later became a SCOR certified instructor and remains focused and actively involved in Aerospace and Department of Defense (DOD) oriented supply chain process environmental frameworks.  John is quick to note how the SCOR framework can crack the code toward understanding certain industry unique needs of supply chain process as well as helping to uncover unnecessary complexity. These special interest group efforts have now been instrumental in shaping DOD policy and guidance to shape the concepts of performance based logistics contract metrics.

In his SCC tenure, John became more involved in SCC board level activities and is now the elected Board chairperson.  In our interview, John noted that his appointment is an indication that SCC is broadening to include a broader industry perspective beyond manufacturing focused supply chains.

Readers should also note that John’s appointment represents the first DOD industry representative to assume the chair position of SCC.

Question: What benefits and services will the Council continue to provide for its members?

John noted that the SCOR methodology continues to evolve and be improved upon through broader training, benchmarking and added process perspectives.  The SCOR model has recently been broadened to incorporate product design, product lifecycle and customer chain processes.  SCC is also finding ongoing success with more geographic focused training and events which allow each geography to incorporate unique supply chain process needs of the particular region.  Europe and Asia based chapters conduct their own unique events and the North America chapter will be hosting both its annual SCOR Users meeting in February, as well as the Supply Chain World North America conference in May of this year.

Beyond the SCOR methodology itself, John noted that SCC is broadening its perspective into other supply chain related needs.

Question: What role will the geographical regional chapters play in carrying out the mission of the Council?

John noted that it has become all too apparent that council members exist in a global economy, and that the fundamental baseline is what supply chain management looks like across the globe.  The board is of the belief that as more global efforts are supported, the more the benefits will accrue to all. John expressed this as a “force multiplier effect”.  Along with this comes a high reliance on the local regional chapters to identify the unique needs for their region.

Feedback among the various geographic regions has been generally positive and the regional chapters are growing.  There are more activities now being sponsored within regions and the pride of ownership is increasing.

One metric noted was the level of SCOR model awareness across the globe. And that SCOR-P certification is catching on internationally. The geographic chapters of SCC  have further increased their efforts to provide more localized awareness and training opportunities.  Today, the SCOR methodology, along with training related to the model, is delivered in multiple languages.

The SCC board is also facilitating more local feedback by scheduling ongoing board meetings in conjunction with local regional events. With this board meeting schedule, local member companies now have the opportunity to be able to directly meet and interact with SCC board members on overall needs of the council.  John feels that this has allowed feedback to bubble-up more quickly and is working out quite well.

This concludes this part one posting.

Bob Ferrari

Disclosure:  The author of this posting, Bob Ferrari, serves as a volunteer on the SCC North America Leadership team.

Supply Chain Matters was pleased to have the opportunity to speak with David Malenfant, Vice President, Global Supply Chain, Alcon Labs, the new chair of the Board for the Supply Chain Council last week. In our part one posting, Dave shared his vision for the Council, the continuing mission, as well as some prospective changes that members can anticipate over the coming months.  In this part two posting, Dave goes on to share prospective changes in education delivery, some comments regarding upcoming programs, as well as Dave’s view of the role that blogs can play in the new world of supply chain management.

Q: What changes have you observed regarding how Council members want to receive education or became aware of new developments and needs in supply chain management?

As mentioned before, supply chain professionals are very busy people. One of the ongoing issues we have debated as a Council is whether to continue to schedule an annual North America or European annual conferences. We will continue to consult with our members relative to the best means for how they desire we deliver that education.   There are so many different supply chain conferences today, many of which overlap. If I had the time and budget, I could attend a supply chain conference every single week. We need to have one conference that differentiates the Council and provides much broader educational opportunities, perhaps in coordination with other professional organizations such as APICS or CSCMP.

The Council will also continue to provide alternative means to get education disseminated either through virtual conferences, monthly webcasts, or other web-based exchange forums. We have been building into the Council web site better means for promoting more awareness to these types of educational events, as well as reaching out more often to the Council membership.

Q: Can you comment on any upcoming programs and/or initiatives to which we can look forward?

At the chapter level, members should anticipate more on the ground activities related to thought leadership, education and training.  One of the things we have learned as an organization during these past months is that supply chain professionals are very, very busy.  We have heard feedback that members desire focused training and education either on the local level where travel can be managed, or virtually via webinars or virtual exchange among professionals.

The other concerning trend is that we are not attracting enough new people into the supply chain profession, people who have the passion for making supply chain their long-term career goal, along with the broad skills to be successful in this changed environment.  I’ve been in this profession for 37 years and we finally are beginning to see that supply chain is being recognized as an attractive profession. If we are really going to help prepare companies for future needs, we’ve got to continue to reach out and partner with educational, academic and other training communities to foster the concept of SCOR as a framework for integrating the various functional and management skills required to succeed in the new era of supply chain management.  We should stress the importance of the SCOR framework as the example of an integrated view of the skill disciplines required to prepare our future supply chain management professionals.  This is a strong passion of mine, and I trust for our membership. There is no better time than now for the Council to grasp and run with this passion in order to make supply chain the profession of choice, and ensure that we have the programs that are designed to do that.

Q: Will SCOR continue to have a global chapter presence?

Absolutely.  As an organization, we continue to reach out beyond just North America and we continue to do that  In South Africa we are doing an exceptional job of reach out, along with our partnership with APICS. In Europe we have had some success, but not as great as I would like to see for the Council. Latin America provides other needs and opportunities.  The global reach of the Supply Chain Council is great, and we now need to expand upon our programs to capitalize on that reach. 

In our ongoing membership programs, I would foresee our organization working more with multi-national companies and their supply chain executives who have supply chain activities residing across multiple global regions, where there remains a need for continuous training and development. That’s also why we have redesigned the Council website to make navigation far easier, allow multiple members of a particular company to have broad access to content, or share in web-based forums or peer exchange.

Q: A final question. I continue to observe by just the increased readership of this blog, that a perspective of end-to-end supply chain integrated process, as well as timely awareness of current supply chain developments and what this means, seems to be filling one educational void for supply chain professionals. What’s your view of the role of blogs within supply chain management?

That’s why your blog is so good, because it provides professionals, who don’t have the time to attend all of these many conferences, or who are on the road most of the time, a means to quickly check into current developments within supply chain, and what meaning they might have.  That’s really what I think it means.  We need open discussions among professionals within blogs, vs. Facebook or Twitter, where these professionals can understand what’s happening with current issues and how their peers are viewing or responding to these trends or events. I like the fact that your blog is posting a lot of current issues.

Dave, I appreciate the time as well as your perspectives, and best wishes on your new role as Board chair.

Background and Introduction

The Supply Chain Council (SCC ), which is sometimes referred to as SCOR, announced its new slate of Board members and Officers in early July to carry on leadership of the organization through 2012.  Supply Chain Matters was pleased to have the opportunity to interview with David Malenfant, Vice President, Global Supply Chain, Alcon Labs, the new chair of the Board for the SCC.

Dave is no stranger to the Council, having served many years in the organization, and most recently as chairperson of the organization’s North America Leadership Team (NALT). In my role as a volunteer member of NALT over the past three years, I have come to appreciate the supply chain practitioner and leadership experience that Dave provided for our team.

The following are Dave’s thoughts about the direction of the Council and the state of the supply chain profession. Due to the length of content, we are dividing the commentary of this interview into two different posts.

 Q: How do you foresee the vision and mission of the Council evolving over this next period of Board leadership?

I view the Council as one of the very few organizations that provides an end-to-end view of the entire supply chain.  If you take a look at many of the existing professional organizations or trade associations associated with supply chain today, many had their genesis from a functional perspective, whether it is procurement, planning, operations, service management, logistics and distribution. The value proposition of the Council, through its evolution of the Supply Chain Operations Model (SCOR) and SCOR process is to provide a perspective of supply chains made up of a fully integrated process vs. any one particular function. We understand that there are multiple functions that make-up a holistic supply chain process.  We want to work with individual companies’ members, and the supply chain professionals that reside in those companies, to transition thinking from an individual functional perspective, to an integrative, end-to-end process perspective.

Moving forward, I would desire Council members to view Council activities and the SCOR model not just as a tool or methodology, but as a means for member companies to dive deeper into supply chain processes, to identify both value as well as opportunity for more efficiency and cost savings. 

Where we have not done a good job in the past is how we position Council activities such as SCOR or DCOR as tools rather than an overall process objective that addresses integration. SCOR in itself can be a process if it is utilized properly. To that end, I would see our organization redirecting its efforts toward helping member companies identify the supply chain as a process that can be fully integrated within a company or service organization.  I’m looking to our strategic committee to identify or expand our efforts for helping member companies’ drive deeper toward either the end customer, or lowest tier of supply, and to look at the supply chain as an overall process that can be fully integrated within the company or organization.

Q; What role and/or benefits will the Council continue to provide for its members?

When you view the supply chain as an integrated whole, it can represent a significant aspect of total cost.  If you are a retailer, 80-90% of value-added costs are associated within supply chain activities.  Consider, for example, Wal-Mart It is a very, very good distribution company that understands its entire supply chain structure. If you extend that to a consumer product goods company, that number may be upwards of 50-60%, and the same holds for automotive and other industry sectors. 

Companies are focusing much more attention to understanding the composition and make-up of their various supply chains.  I speak often with executive recruiters, who are being bombarded with requests to hire experienced supply chain people.  In this economic environment, companies understand that in order to remain profitable, they have to have a full understanding of their cost structure as well as be able look across the whole of their supply chains for cost savings opportunities. They are seeking experienced professionals who can help to quickly identify opportunities for efficiency, but, at the same time, responsiveness to customer needs. I sometimes push back on these requests, because these skills must be developed from within the organization. This is where the Council has an opportunity from a professional development standpoint.

Q; Should existing or prospective Council members expect any changes over the coming months?

Over the coming months as the Council becomes more focused, member companies should expect the organization to have a clearer mission statement and value proposition and clear strategic thrust.

Our organization has already reached out to other supply chain professional organizations such as APICS (Association for Operations Management) to provide broader benefits for both companies and individual supply chain professionals.  Members of the Council are now eligible for member pricing on APICS certification exams and educational events, and APICS members will benefit from access to SCOR’s various training and benchmarking activities. We hope to expand this effort and work with other organizations as well, such as CSCMP or ISM. We all work together in the same space and should collectively be focused on providing additional value for both individual functions, as well as the overall supply chain process.

There was an important announcement that may capture your attention if you are an individual member of APICS (The Association of Operations Management), or if your company holds a membership to the Supply Chain Operations Council (SCOR).  Both organizations have agreed to provide uniform member-discount access to each others training and certification programs.

What does this mean, you ask?

If your company has a SCOR membership, you will receive APICS member rates for all certification exams, including the CSCP (Certified Supply Chain Professional) exam, as well the APICS International Conference and certain other designated events.  If you hold individual membership in APICS, you now can take advantage of member rates for SCOR training programs, including SCOR model certification.  APICS members can also participate in the SCORmark benchmarking program, which provides organizations the ability to rate their performance within database of industry-specific SCOR performance metrics.

You can view more detailed information at either the SCOR or APICS designated explanation website pages.

In my view, this announcement is yet another reflection of the reality of the current recessionary economy worldwide.  Both organizations are feeling some effects on membership renewals, and want to respond to member needs for broader value in a professional membership. Discounted access to each other’s training is a first step. 

I can envision broader opportunities as well.  SCOR has a major initiative underway in identifying future supply chain skill requirements under the Global Supply Chain Professional Development and Skills Committee.  It would be great if the findings of this SCOR effort can be an input to future CSCP certification. 

Before my readers speculate, let me further clarify that this announcement is not a merger, but rather a pragmatic business decision that meets mutual benefit.  SCOR gets broader exposure to its SCOR Model training programs and APICS can broaden its availability of supply chain training offerings as well as the potential to access a deeper body of supply chain knowledge.

Another obvious question for readers is whether this a sign of broader relationships among professional groups that umbrella our profession? What about the Council of Supply Chain Management (CSCMP) and the Institute of Supply Chain Management (ISM), both of which offer training, conferences, and a body of knowledge to supply chain management professionals?  When will they reach out for broader value for members? Only time will tell.

In the meantime, take advantage of this specific opportunity.  You are also welcomed to share your reactions in the comments section related to this post.

Bob Ferrari

Full Disclosure Statement:  I am a professional member of APICS, CSMP, and SCOR.  I also currently serve as a volunteer member of the SCOR North America Leadership Team, as well as the APICS CSCP Certification Exam Review Committee.

In my part one posting, I outlined the fact that the current Version 9.0 of the SCOR-model has begun to incorporate supply chain risk management assessment, tracking, and mitigation methodologies in the overall framework. In this second posting, I’ll provide observations and comments around the definitions of the various supply chain risk enabling tools.

Readers who are familiar with the SCOR methodology may recall that for each of the major processes of Plan, Source, Make, Deliver, and Return, there are associated enablers to monitor compliance, deliver information from other process areas, or highlight dependencies on other process areas.  The Version 9.0 framework now includes the following supply chain risk management enablers, along with some recommended metrics for measurement:

Plan

Manage Supply Chain Plan Risk (EP.9)- defined as the process for identifying, coordinating and managing supply chain risks by aligning with the overall business risk management program. This enabler includes identifying the potential risks, assessing the probability and potential impact of risks, and planning risk mitigation strategies.

Select Performance Attributes:

Supply Chain Agility 

     Industry Benchmark Comparison (%)

     Options or Hedge Rating (%)

Supply Chain Costs

     Mitigation Cost overall or event ($)

I would have expected some further depth in the defining the attributes of risk in supply chain reliability as well as responsiveness, but it would appear that there was a lack of overall consensus among the steering teams to declare definitive metrics for these attributes.  I’m hopeful that later versions will include these metrics.

Source

Manage Supply Chain Source Risk (ES.9)- includes the identifying and assessing of Source risks that could impact the organization’s or the supplier’s ability to deliver materials in a timely manner, at reasonable cost, and with acceptable quality.

Select Performance Attributes:

Supply Chain Reliability

     Supplier Mitigation Plans Implemented (percent)

      VAR of product/customer performance

       Age of Supplier Risk Data (months)

Supply Chain Responsiveness

     External Event Response (average days)

Supply Chain Agility

     Internal event Response Time (average days)

Supply Chain Costs

     Mitigation Cost overall or event ($)

In my view, the area of sourcing should currently have the most mature amount of quantified data related to the managing of supplier risks, and many organizations should be able to make initial inroads with these enabling measurement categories.

Make

Manage Supply Chain Make Risk (EM.9)- the process of managing risks related to producing products on-time at a reasonable cost with good quality, as well as planning and implementing responses to Make risks.

Select Performance Attributes:

Supply Chain Reliability

     Supplier Mitigation Plans Implemented (percent)

     Value at Risk (Make)

     Age of Supplier or Customer Risk Data (months)

Supply Chain Responsiveness              

     External Event Response (average days)

Supply Chain Agility                            

     Industry Benchmark Comparison (5)

     Internal event Response Time (average days)

Supply Chain Costs

     Mitigation Cost overall or event ($)

Since the SCOR model has to accommodate both manufacturing and service-related business models, the area of Make can include a wide swath.  My first reaction to these enablers was that they are far too similar to the Source processes.  Readers should keep in mind that with the SCOR-model of a service-related business, Source may be an activity of less emphasis.  In either case, I would anticipate that more depth and implementation team innovation will be required in this area.

Deliver

Manage Supply Chain Deliver Risk (ED.9)- the process of managing risks that could impact the company’s ability to deliver product on-time at a reasonable cost and quality.

Select Performance Attributes:

Supply Chain Reliability

     Value at Risk (Deliver)

     Age of Product/Customer Risk Data (months)

Supply Chain Responsiveness

     External Event Response (average days)

Supply Chain Agility

     Industry Benchmark Comparison (percentage)

     Internal Event Response (average days)

Supply Chain Costs                             

     Mitigation Cost overall or by event ($)

These are all reasonable initial metrics and it will take some time to build critical mass of available benchmark data to reasonably map your organization to other similar organizations.

Supply chain risk management has become an increasingly more critical aspect of global supply chain strategy.  As the economy provides a period of business downturn, now made be the time for organizations to take the time to invest in a global supply chain risk assessment.

It would be helpful for our broader community to read additional commentary and feedback from readers who have either made a SCOR assessment in this area, or have attempted to implement enabling metrics of measurement in supply chain risk management. I encourage commentary in the comments section below this post.

Bob Ferrari