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Introduction
Once, at a seminar on the supply chain operations reference model, an executive in attendance opened the Q&A portion with this request: "Most of us don't have good control of our supply chains—inside the company or with trading partners. What two or three things would you say to motivate us to address the supply chain?""If you can define your supply chain—which isn't hard to do—then you can measure it," Peter answered. "Once you've measured it, you'll find the opportunities are so big that you won't need any more motivation. You'll want to drive continuous improvement in your supply chain."This book is not a manifesto on the power of supply chain management. In fact, the two paragraphs that you've just read are the only argument you're going to get in this book about why supply chain management is important.The rest of this book is about the how—how to achieve these two fundamental principles of supply chain management: Define/measure and drive performance improvement.
Defining Supply Chains
Like most bandwagons, supply chain management (SCM) has been defined and redefined in many ways over the past ten years. To a large degree, the definition depends on your motivation and interest.A technology provider trying to sell software might align SCM with using advanced planning functionality; a third-party logistics provider (3PL) trying to sell its outsourcing capabilities will align SCM with distribution practices; and a consulting firm selling services will align SCM with its intellectual property. But there really is an objective, unbiased way to define supply chain management; it's a cross-industry standardized model called the Supply Chain Operations Reference—or SCOR—which is the foundation of this book.
