Appropriate Level 1 Metrics for Feets Company
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Introduction
Supply Chain Management SCM is crucial for organizations that specialize in buying and selling commodities in the market. It enables a smooth movement of products from producers to the final consumers either directly or through intermediaries. The supply chain involves all actions and members facilitating a smooth and consistent flow of commodities from a firm to the final consumer or another firm. A business needs to apply the SCOR model to have an efficient and successful supply chain. The Supply Chain Operations Reference SCOR model allows a firm to achieve a perfect supply chain by evaluating the supply chain performance, identifying performance gaps, and techniques to narrow and eventually eliminate the gap (Hammadi et al., 2021). A business can utilize the SCOR model in three distinct levels and performance attributes to achieve efficiency and consistency. This paper will discuss the level one metrics for Feets Athletics wear distribution chain company, the implementation, and recommendations.
The Feet athlete’s footwear company can use a set of level one metrics to better its supply chain performance and maintain relevance in the shoe industry. Level one metrics of the SCOR model are used by company heads to measure the performance of a firm’s supply chain (Ayyildiz & Gumus, 2021). They are the most aggravated level in the model hence being referred to as the ‘parent’ category. The first level 1 metric is that can be employed by Feet company is the Perfect Order Fulfillment POF. The POF refers to the percentage of order deliveries that reach the buyer in good condition, with no delivery damages and perfect documentation. Basically, it meets the delivery performance, and its performance credit is supply chain reliability. This aspect means that the supply chain is trusted to transition the products from one level of the supply chain to the other without any difficulties.
Feet company can perfect its supply chain and ensure that its products reach the buyers in good conditions or the products from the vendors reaches them in good condition through various ways. One method is through streamlining the supply chain. It involves reducing suppliers’ congestion and order processes to minimize the risk of mistakes at different levels of the supply chain (Hammadi et al., 2021). The company can reduce the number of vendors or buyers depending on their objective as a business to ensure that there is no delivery confusion. In addition, it can also evaluate the inventories regularly to ensure they are accurate and updated. These actions enhance the performance of the Feet shoe company and a smooth running of operations.
The second level one metric is the Order Fulfillment Cycle Time, OFCT. OFCT is how fast a company can consistently deliver its products to its customers. It refers to the average cycle timeframe that a company consistently fulfills orders to its customers (Ayyildiz & Gumus, 2021). Its performance attribute is the responsiveness of a company’s supply chain. The Feet shoe company can improve its delivery speed and consistency by embracing advanced transportation channels to deliver the commodities to the buyers. The company can also group the commodities into different transportation channels such that products under the same route are placed in the same transportation channel. These improvements will enable the distribution company to save on time and transportation costs and, most importantly, deliver the products to buyers on time (Bindi et al., 2021). The Feet company needs to understand that delayed deliveries can disorient the supply chain. It might cause an increase in demand in the retailing sector, which would increase the prices of the commodity and disrupt the workflow at different levels of the supply chain.
The Supply Chain Management cost, SCMC, is also a level one metric vital for achieving a stable supply chain. SCMC can be defined as the total cost required to run the supply chain effectively. It also involves the cost of facilitating the procedures of level 2 of the SCOR of planning, sourcing, delivering and returning (Nguyen et al., 2021). The Supply Chain Management Cost is attributed to the Supply Chain Costs. The Feet Shoe Company should meet its supply chain costs during any season of the year. It means that regardless of a shift in demand for the products due to changes in market trends and consumer preference, the company should have strategies that will help its supply chain stay afloat until a peak season picks up. The company should utilize this metric to run its supply chain effectively without any financial strains. Adopting this metric would allow Feet to evaluate the resources available in the firm and the percentage to allocate to the supply chain such that areas do not run dry. The company then develops a plan with strategies to be used over a certain period. The plan should accommodate uncertainties in the market.
The SCMC metric will help the Feet Company keep track of its shipment and other costs in the supply chain, isolate any irregularity and tackle it before it affects other levels of the supply chain. This metric will also help the Feet Company identify financial loopholes and unnecessary spending in the supply chain that is eating into the firm’s capital and address it either by themselves or by hiring a financial expert (Bindi et al., 2021). Unnecessary spending can be reduced by limiting sales and promotions. Promotions by Feet Company to its buyers will require them to increase their purchase from their vendors, yet they might not experience a high product demand. This approach to increasing sales is risky as it can lead to extreme losses and cause an imbalance to other levels of the supply chain. Feet Company should strive for financial stability in its supply chain. Consequently, other supply chain levels will run smoothly, thus improving performance.
Conclusion
Despite a difference in priorities for companies, the SCOR framework still proves essential but not necessarily all the steps in it. It is undeniable that the level 1 metrics of the SCOR model are essential for the success of any given company. It gives a business the right perspective and the areas to focus on in the supply chain. The model allows firms to develop and customize their product to satisfy their customers. In addition, it brings a correlation among the different levels of a product’s supply chain. Technological inventions have further enhanced the model’s effectiveness and made things easier and faster, right from the manufacturer, storage in the warehouses and shipment to various regions in the country. Organizations under different levels of the supply chain should therefore incorporate the model in running its operations to experience its benefits.
References
Ayyildiz, E., & Gumus, A. T. (2021). Interval-valued Pythagorean fuzzy AHP method-based supply chain performance evaluation by a new extension of SCOR model: SCOR 4.0. Complex & Intelligent Systems, 7(1), 559-576.
Bindi, B., Bandinelli, R., Fani, V., & Pero, M. E. P. (2021). Supply chain strategy in the luxury fashion industry: impacts on performance indicators. International Journal of Productivity and Performance Management.
Hammadi, L., Souza, D. C. E., Barbu, V. S., Ait Ouahman, A., & Ibourk, A. A. (2018). A SCOR model for customs supply chain process design. World Customs J, 12(2), 95-106.
Ikasari, N., Sutopo, W., & Zakaria, R. (2020, October). Performance Measurement in Supply Chain Using SCOR Model in The Lithium Battery Factory. In IOP Conference Series: Materials Science and Engineering (Vol. 943, No. 1, p. 012049). IOP Publishing.
Nguyen, T. T. H., Bekrar, A., Le, T. M., & Abed, M. (2021, May). Supply Chain Performance Measurement using SCOR Model: A Case Study of the Coffee Supply Chain in Vietnam. In 2021 1st International Conference on Cyber Management and Engineering (CyMaEn) (pp. 1-7). IEEE.
