SCOR MODEL

AGENDA

• Process Reference Model

• SCOR Model
• What?
• Span it operates
• Limitations & Assumptions
• AT&T Wireless Services
• Learnings
SCOR MODEL
SCOR – MANAGEMENT PROCESSES
“Supplier’s suppliers to Customer’s customer”
SCOR – LIMITATIONS & ASSUMPTIONS
Limitations
• Sales and Marketing
• Research and technology development
• Product Development
• Some elements of post delivery customer support
Assumptions
• Training
• Quality
• Information Technology
• Administration
AT&T WIRELESS SERVICES
McCaw Cellular Communications: AT&T Wireless
Services in 1994
• 70% manufacturing was outsourced.
• Global presence was wide but not deep as only 10% of
this revenue came from the global sales.
• Transition from B2B business model to a consumer-
product model.
• Problem getting the right product at the right place at the right
time
• Huge amount of inventory in pipeline. About 3 to 4 months.
Plus the product life cycle was reducing in this segment.
• Wireless Services division: Financial losses to 20% of
the revenue
• Cash-to-cash cycle was 10 weeks.
AT&T SERVICES – LEVEL-1 METRICS
AT&T SERVICES – LEVEL 2
• Pre-Implementation
• Complex supply chain network
• Sourcing lead times was over 200 days for some products
• High conformance to forecast production
requirements
• High forecast errors ranging from 40 – 80%
• Change in supply chain
• Demand driven supply chain
• Usage of common components
• To Combine manufacturing and distribution
operations located in Mexico
• Reduction of supplier base and strengthen the
partnership with chosen few suppliers
AT&T SERVICES – LEVEL 3

Specific elements improvement.

• Real time information on available to promise
quantity: integration with scheduling and
inventory management system
• Electronic order handling

• Ship complete orders

• Handle 90% order on FIFO basis

AT&T SERVICES – LEVEL 4
BENEFITS - POST IMPLEMENTATION
• Immediate financial improvements just by
closing down and consolidating the SC into a
make-to-order environment
• By the second year of implementation
• Gross margin was improved by 10% of revenues –
resulted in $200 million worth of savings
• Significant reduction in inventory – 55% reduction in
inventory
• Improvement in cash flow – cash-to-cash cycles
were reduced by about 70%
• Improvement in delivery performance – cycle times
were reduced by 80% (12 weeks to 2 weeks)
LEARNING

• Need for fact-based analysis

• Identification of strategic performance
advantages
• Top management involvement
• Need for continuous updation of
• Value proposition
• Benchmarks
• Refining supply chain
REFERENCES

• SCOR Overview 9.0- Supply Chain Council.

• www.supply-chain.org
• Handbook on Supply Chain Management
• Evolving Enterprise: Volume 1-Lionheart
Publishing.
• www.ism.ws
Thank You