Major Techniques and Current Developments of Supply Chain Process Modelling

Major Techniques and Current Developments of Supply Chain Process Modelling

DOI: 10.4018/978-1-5225-7362-3.ch082
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Modeling of supply chain processes is fundamental to the analysis of these processes and is essential for process design prior to implementation of a supply chain management system. In this chapter, the background of business process modeling is first introduced. This is followed by a summarized description and critical discussion of the major techniques for supply chain process modeling such as the SCOR model, BPMN, UML, IDEF, and simulation. These techniques have been widely used in academic research and development of management information systems. Finally, future trends are pointed out, and the chapter is concluded.
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Supply chain management (SCM) has received increasing attention in the literature since the early 80’s (Ellram & Cooper, 2014). While there are many definitions of SCM, it can be defined as the integration of key business processes covering a wide range of activities from the original supplier to the end customer that add value to stakeholders in terms of products, services and information (Cooper, Lambert, & Pagh, 1997; Mentzer et al., 2001). Many researchers support this process view of the supply chain and argue that it helps to reduce supply chain costs and enhance customer satisfaction (Trkman, Stemberger, Jaklic, & Groznik, 2007).

There are a number of models or frameworks for a holistic understanding of supply chain processes (Ellram & Cooper, 2014). The supply chain operations reference (SCOR) model developed by the Supply Chain Council (SCC) identifies six core processes in a supply chain: plan, source, make, deliver, return and enable (SCC, 2012). Meanwhile, the Global Supply Chain Forum (GSCF) pinpoints eight key business processes in a supply chain that work at both the strategic and operational levels for the improvement of internal and external results (Croxton, Garcia-Dastugue, Lambert, & Rogers, 2001). Recently, Xu, Koh, and Parker (2009) propose a research framework that consists of seven business processes for manufacturing coordination in a complex supply network. Though these supply chain models or frameworks have different purposes and scopes, the business processes proposed in these models or frameworks need to be analysed and implemented in practice through modelling.

Clearly, SCPM is closely related to business process modelling (BPM) as a supply chain process can be viewed an extended business process. BPM is often used as a platform for achieving a common understanding of a business process (Aguilar-Saven, 2004). It has been broadly recognised that good process models are essential for business process re-engineering (BPR) (or improvement) or for information system development. Generally, BPM can be regarded as a methodology which employs software systems to analyse, design and improve business processes so that a company’s business performance in terms of productivity and profits can be improved (Bae & Seo, 2007; Trkman et al., 2007).

Key Terms in this Chapter

Benchmarking: A performance management practice by which a company compares its own business processes and performance metrics to those of the best in the industry.

Business Process Modelling: The activity of representing a company’s business processes so that the current process can be performed in a more effective and/or efficient way leading to improved business performance.

Internal Processes: The business processes that can be executed without involvement of an external business partner such as the internal production process.

External Processes: The business processes that cannot be executed without involvement of an external business partner such as the customer relationship management process.

Process Integration: An approach of attaining close alignment and seamless coordination of internal and/or external business processes.

Object-Oriented: System design or analysis, or software program that use objects.

System Dynamics: A method through which the dynamic behaviour of a complex system over time can be better understood by taking into account internal feedback and time delays.

Business Process Reengineering: A method by which business performance can be dramatically improved through rethinking and redesign of processes.

Monte Carlo Simulation: A computerized simulation technique which is usually used for analyzing the behaviour of a system or a process involving uncertainties.

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