Global Logistics and Supply Chain

Management

 John Mangan
 Chandra Lalwani
 Tim Butcher

ISBN: 978-0-470-06634-8

1
TThe
he Contents
Contents of
of the
the Books
Books
(Chapter
(Chapter 11)
11)

Presented by Sean M Hsu

Advisor : Dr. Jr Jung Lyu
 Chapter 11

Measuring and Managing Logistics Performance

3
 Learning objectives
 Understand basic forms of performance measurement used in a logistics
context such as tacho-graphs ( 轉速記錄機 / 行車記錄儀 ) in road haulage ( 運
搬 ) and space utili-zation ( 利用 ; 使用 ) in warehousing
 Illustrate the trend towards measurement of a wider array of activities
and the eight driving forces behind this trend
 Explain why many LSPs (logical signal processor 邏輯信號處理機 ) now
routinely share key performance data with customers
 Understand the role of benchmarking in the context of logistics
performance management
 Identify 「 how many 」 and 「 which KPIs 」 to track, 「 how 」
they are embedded within the organization, 「 how 」 they fit with
wider company objectives, 「 where 」 the requisite-data (
) will come from, and 「 who 」 (at what levels within the
organization) should receive the information generated by these KPIs
 Understand in particular warehouse/inventory metrics and total landed

[tqUh
costs
4
 Basic measurement

 LSPs traditionally employed measures that were

either very basic from an operational viewpoint,
or imposed on them by law

5
 The tacho-graph

 Fitted to a truck to record its speed, distance

travelled and any breaks taken ( 行車記錄器 / 黑盒子 )
 Used by police forces to ensure that laws relating
to the maximum hours a truck driver can work are
observed
– The rules are designed to limit continuous driving time
and detail minimum breaks and rest periods

6
 Resource utilization measures

 At the broader company level the key inventory measure:

– Inventory turnover (from a financial perspective) 存貨週轉
 Warehouse utilization measures 倉庫利用率
– Total number of pallet ( 棧板 ) or carton spaces consumed vs. total
available
– Total space consumed within the warehouse
– Throughput ( 生產處置能力 / 吞吐量 ) , e.g. total number of
shipments received
 Road transport utilization measures
– Total number of deliveries successfully completed vs. ‘dropped
deliveries’ (i.e. failed deliveries)

7
 A contemporary viewpoint
 Today’s 3PLs not only have to display expertise in
operational management, they must also keep track of each
transaction and ensure that they and their customers and
agents can have access to information relating to this flow as
and when it is required
 Such is the importance of monitoring this information that
many 3PLs now have dedicated staff who’s job it is to record
data that can be used in the development of metrics ( 發展成效
量測的指標 / 關鍵 ) SCOR Model 的 Metrics （衡量指標）

 效能度量 (metrics) Performance Metrics: The Measurement of Healthcare Delivery

Performance within a New Built Hospital
 研究現狀－ USCERT 標準
Security Scoring Standards of USCERT
US-CERT 用 metric value 來評價一條漏洞的嚴重程度， metric value 是一個在 0 到 180
之間的數值。
The Metric Value is used to score a vulnerability by USCERT, and the range of the metric
value is from 0 to 180.

8
 Key performance indicators

 KPIs are shared with staff at all levels and in all

functions, with partners and agents, and most
importantly with customers
 Most large customers now hold formal business
reviews with their 3PLs where the presentation of
KPIs is a key part of the meeting’s focus
 Logistics businesses now see measurement of the
performance of all operational areas as a common
requirement from their customers

9
 )

引
下
而
上
由
展
導發
(

形成
策略

展開
策略

工作
行先導
策略執
護 連
維
及
現
呈
統
系
訊
資 酬 分
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核
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績
結 算
預
製
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源
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配 題
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定
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方
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行
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目
略
策
展
發
展
發 景
願
展
發 析
分
境
環
KPI

值
標
目
KPIs
導入架構

)
回
上
而
下
由
整
饋調

(
 好的 KPI 衡量基礎 --SMART
 S – Simple (or Specific 定義明確 )
簡單、不複雜、有意義
 M – Measurable (or Money 確實可以衡量 )
可以被量化、資料是可提供的
 A – Achievable (or Approachable 達得到的 )
可達成的
 R – Realistic (or Result-oriented 目的導向 )
可實現、合理的 、實際可行的
 T – Timely (Timing 掌握時效關鍵、切對時間點 )
有時效性的、如每月或每季 ( 不能無限展延 )

※ 不論是量化的 KPI 、或者是質化的完工百分比法 (%) - Money 是唯一共

通的語言
Fundamentals- 基本的管理報表介紹

一般代表性的程度衡量或分類： 新產品銷售百分比、客戶
接受度、市場佔有率、及時上市 …
財務績效： NPV, ROI, EVA, BET (Break-Even Time 損益兩平 )
…
客戶滿意： 退貨率、抱怨率、滿意度 …
員工滿意： 招募 / 離職率
成長、創意與學習： 專利數、版權數
生產力與資源運用率： 專案與能力比重負荷
作業掌控： 製造良率、訂單週期
對成功的衡量： 依據各家策略與商務行為達成的程度，去認
定他的成功水準。
 Driving forces for
performance measurement
 Increased reliance on  contract manufacturers
 Strategic importance of LSPs to  supply chain success
 Adoption of  manufacturing management principles
 Impact on  customer experience
 Increased  competition
  Information technology improvements
  Empowerment practices
活力化 ( 企業組織賦予員工更大的授權、參與決策權力、組織工
作團體、目標設定及訓練的作為 )
  Employee motivation

13
 Selecting the best measures

 ‘measure results, not activities’

– it is all too easy to focus on simply assimilating data ( 消
化吸收 / 同化 ) without necessarily understanding how this
data may be used 【 only Focus on KPI 】
– When setting KPIs, focus on what benefit one hopes to
gain as a result of having these measures in place 【 to
be in proportion 】
– Don’t focus on what data may be easily available

14
 Quantitative vs. qualitative KPIs
 The majority of measures should be focused on
quantitative results ( 量化 )
– Measures based on raw data can often be better for accurately
comparing performance over time, and indeed for predicting
future results
– Quantitative results are more reliable when comparing over time,
as long as the data used to generate them can be replicated without
error (Forecasting & Predicting)
– Forecasting : 時間是最主要因素，利用過去的數值來推測未來，模型是用來
預測不在輸入值中的推測值，例：下次什麼時候，有人會買這項產品。

– Predicting : 時間因素通常不被考慮，找出一個預測的模型 ( 規則 ) 來對一個

或多個變數進行預測，模型僅能包括輸入值的範圍，無法超出。如：在何種
條件下，有人會買這項產品。
 Some qualitative measures can also be useful ( 質化 )

15
 Benchmarking

 Companies should always look to emulate/ε/ best in

class
– This is the role of benchmarking
 Logistics companies rely on referrals / / from
not just customers, but also from competing firms
– The referring company may not have the required capacity

[qati
but wants to fulfil their customer’s requirement
– It is therefore important that some benchmarking of
performance can first take place

16
 Benchmarking

 To benchmark against the industry, the company needs to

use a similar set of measures in order to map
performance against the companies being benchmarked
 The time to first consider benchmarking is when a
company is initially putting together a set of performance
measures
 It should be seen as a continuous process, and not as a
once off project
 Today’s logistics industry is very dynamic and benchmark
levels of performance can constantly change

17
 Figure 11.1 Category of metric reporting
Top-down & Bottom-up : Strategy vs. KPI

※ OTD is on-time delivery; FTE is full-time equivalent, i.e. the equivalent of one employee 18
Figure 11.2 Goals and Metrics for use in a typical balanced scorecard. Source:
based on Kaplan, R. & Norton, D. (1992)
The balanced scorecard – measures that drive performance,
19
Harvard Business Review, January–February
 平衡計分卡的四個構面
衡量過去努力成果
“To succeed
financially, Objectives Measures Targets Initiatives
how should
we appear to
our share-
holders?”
財務
有關重大企業流程 , 創新能力
股東與顧客的外界衡量 學習及成長的內部衡量
“To achieve “To satisfy our
Objectives Measures Targets Initiatives Objectives Measures Targets Initiatives
our vision, shareholders
願景 &
內部流程
how should and customers,
we appear
to our
customers?”
顧 策略 what business
processes must
we excel at?”

客
“To achieve
our vision, Objectives Measures Targets Initiatives
how will we
sustain our
ability to
change and
學習與成長
improve?”

驅動未來績效
Source: The Balanced Scorecard Collaborative
 成功關鍵因素
企業領導者的帶動
動員企業作改變
(Policy & Top-down)

將策略轉換成
作業條例
( 標準化 / SOP/ SIP)
- Strategy maps
- Balanced Scorecard
- Integrate operational tools
- Mobilization
- Strategic Management
擬定策略是
持續性的過程
(Continuous Improvement)
- Learning organization
- Analytics and IS
- Link budgets & strategy

將企業組織與策略 擬定策略成為
緊密聯繫 每個人的職責
(Cop/ Sop/ Mop) (Top-down & Bottom-up)

- Corporate role - Strategic awareness

- Business unit synergies - Personal scorecard &
- Support unit synergies compensation
 建構平衡計分卡所須具備的條件

 提供發展平衡計分卡的指導原則與策略核心矩陣
(Core-Tech, Top-down, and Strategic Matrix)
 彈性的展現方式 ( 策略與矩陣管理 )
 多樣化的資料存取方式
 整合分析的能力 , 例如 OLAP Reports
‘On-Line Analytical Processing’
 可執行與可運作的工具
 整合教育訓練與溝通
 知識管理與平衡計分卡相關文件的管理
 與其他系統的整合
– 如 ERP, BI (Business intelligence, BI), ISO 9000, 6σ
– 知識就是力量。 BI 系統收集您客戶的相關信息並加以分析，以幫助您確定商機和創建
可以滿足客戶需求的戰略。數據倉庫、數據挖掘和決策支持中的先進技術創建大量的
BI ( 商業智慧 / 商務智能 ) 工具。
 系統擴充之容易度
 發展平衡計分卡之步驟

規劃並建構
釐清策略 設計平衡計分卡 系統環境
經營環境 財務構面策略目標 KPI 所需資料來源

願景與使命 客 戶 構面策略目標 指定資料提供者

營運方針目標 流程構面策略目標 現有系統支援程度

業務策略 學習構面策略目標 資料更新時間

經營模式 各構面 KPI 規劃系統運作功能

策略地圖 & 因果關係 開發系統運作環境

圖
KPI 清單
 平衡計分卡
願景

產業結構分析
競爭力分析

導入分析
導入分析 策略

•股東權益與獲利 •方針管理
•財務績效 價
價 •企業 e 化
•集資計劃 財務 值
值 內部流程 •企業流程改造
鏈
鏈
•行銷通路 ::
機 •職涯規劃 職能庫
•網路行銷 機 •教育訓練
•策略聯盟 顧客 能
能 學習成長 •薪酬制度
•客戶關係管理 管
管 •人力結構
•客服中心 理
理
 Balanced Scorecard:
Causal Relationships
Strategy

Internal Customer Financial

Process T1 T2
T0

Learning
T3
 Inventory / warehouse
related metrics - receiving
 Generally the first to be recorded, because receipt of product is often
the most important transaction
– If the receiving process is well thought out and implemented, then stock
accuracy and product in/tegrity should also be well managed
– If product is received into the correct location, and in the correct quantity,
then the subsequent picking process too has a good chance of being
problem free
 Receiving metrics
– Receiving time
– Receiving On-Time Delivery
– Delivery paperwork detail is correct
– Part numbers, lot numbers and purchase order numbers match that on the
paperwork and as against the ASN
– Product is physically inspected with unit / carton or pallet count
completed, product inspected for any signs of in-transit damage,
repackaging, etc
26
 Inventory / warehouse
related metrics - put-away

 Put-away metric ( 把 ... 收起 ; 放好 )

– Number of pallets, cartons or units put-away

• Compared against the resource available to produce a
productivity measure
– Percentage of product put-away within a stated time
• Many warehouses might have good receiving metrics, but have
product sitting on the floor yet to be put away ( 儲存 / 拋棄 ; 放棄 )

27
 Inventory / warehouse
related metrics - inventory accuracy
 Inventory metrics act as a measure of operational performance, and
reflect the ad/herence to processes, rather than the performance of the
inventory team who conduct cycle counts
 Cycle-counting of product is an activity that customers usually take a
keen interest in because the material being counted generally sits on
their balance sheet rather than the 3PL’s balance sheet
 Cycle-counting measures the length of time that inventory is sitting
in the warehouse
– An aged stock report, detailing the number of weeks product is in stock is
easiest to report
– An overall view of stock movements within the warehouse can be given with a
report outlining the number of inventory turns

28
Figure 11.3 Total landed costs

29
 Logistics costs performance

 A purchasing decision should consider all related

costs:
– Freight ( 貨運 )
– Carrying Costs ( 運送成本 )
– Duty ( 稅 )
– Packaging ( 包裝 )
– Warehousing ( 入庫 )
– Locali/zation ( 局部化；地方化 )

30
 3PL cost models

 Cost plus margin ( 利潤 ; 賺頭 )

– Often the preferred model for 3PLs
– Advantages: ( 利多 )
• It provides complete trans/parency for all parties involved
• Risk is reduced for both parties
– Disadvantages: ( 利空 )
• Often a reluctance for the 3PL to drive continuous improvement
• Resources may be fixed at a level that meets the peak season demand
• Resources employed may not be adequate to meet business
requirements
• Little opportunity for 3PLs to make high profits

31
 3PL cost models

 Transactional Pricing
– 3PLs will use all their available resources across multiple
customers and quote a unit rate for standard warehouse activities
– Advantages:
• Resources are generally not fixed by the customer
• The 3PL will be highly motivated to drive efficiency at all stages of
their process as any savings made will result in higher profits
– Disadvantages:
• The customer may not always get the customer service that they
require
• The 3PL needs to ensure that special requests are charged separately
• The customer does not have transparency ( 透明 ; 透明度 )

32
 Service level agreements

 A mutually agreed and understood agreement put in place

between both the company buying the service and the company
providing the service

 To include:
– Roll-out and duration of the service or process being
purchased
– Scope of services
– Areas of responsibility (i.e. who is responsible for what) -PIC
– Performance metrics

33
Supplementary
Supplementary Matter
Matter
(Chapter
(Chapter 11)
11)

~ Some Additional Remarks ~

 The Cultivating for Quality ( 舉例 )

 Top-Management Top Down

 TQM (Total Quality Management)
 Division Managing
 Policy Deployment
 Dept. Managing
TQM
 Dept. Managing  QMU (Quality Management for Unit)

 Unit Managing  SPC/ SQC Training & Problem-solving

 Engineer Managing  Manufacturing Consulting

SQC
 Engineer Operating  QCC Training
 Operator Operating  Work Training
Bottom Up
QCC
 方針整理流程
問題點對 ○○ 年度 XX 部 公司內部 公司外部 競爭公司
策 門 問題點 問題點
一覽表
問題點對策 展望目標
○○ 年度 XX 部 公司內部 公司外部 競爭公司
一覽表 門 問題點 問題點
問題點對策 展望目標
○○ 年度 XX 部 公司內部 公司外部 競爭公司
一覽表 門 問題點 問題點
展望目標

總經理目標方策 TQM 戰略
評價分析矩陣圖 要因矩陣圖

總經理年度 TQM 戰略要因

目標方策分析矩陣 S-W 分析
圖

○○ 年度總經理方針
 流程式組織 -- 橫向管理 & 縱向
管理
(COP-SOP-MOP)
機能別管理與部門別管理的相互關
係
方針管理

機能別管理　 機能別管理
新產品開發 新產品開發
品質保證 品質保證
量 管 理 量 管 理
成本管理 成本管理
標準化 標準化
教育訓練 教育訓練
　 　
　
QMU 部 門 別 管 理 品經體活動
Matrix Organization & TQM
 基本名詞

 BSC: Balanced Scorecard 平衡計分卡

 CPM: Corporate Performance Management 企業績效管理
 KPI: Key Performance Indicator 關鍵績效指標
 ERP: Enterprise Resource Planning 企業資源規劃
組織整體運作能力，而非績效指標，為組織競爭力來源
• 要知道績效之良莠，需要有正確的【績效衡量指標】
使用好的【績效管理】方式來評核與獎懲員工，驅動其
行為
• 員工的行為，必須依照【策略規劃展開】後的行動計劃
• 【組織整體運作】為競爭力持續性最終來源，故策略展開之行
動計劃用於建構組織整體運作能力

價值創造之
具體能力之展現
程度高低

檢視經營內涵 組織整體運作

給予激勵╱懲處 策略規劃展開

提供資訊 績效管理

績效衡量指標

• 財務面 • 監控 • 策略 • 組織
• 非財務面 • 評核 • 行動計劃 • 流程
• 獎懲 • 人員能力
• 資訊科技
 建立企業績效管理／平衡計分卡制度對企業之
幫助

 將策略轉換為不同層次之營運用語
 將組織目標平衡地連結至企業整體策略目標
 依據組織目標進行行動規劃與資源分配
 監控策略之達成程度
 採用策略管理流程並使其在組織內成為一個永續的流程
 透過決策領導動員變革

 而不是僅僅為了衡量而建立關鍵績效指標 KPI
 平衡計分卡僅為企業績效管理架構之一
 大衛．諾頓 (David Norton) 與羅伯．柯普朗 (Robert Kaplan) 教授根據其對許
多發展出創新績效衡量系統公司進行個案研究之研究結果後，於 1992 年提出
「平衡計分卡」 (Balanced Scorecard, BSC) 模式。成為企業績效管理使用之
衡量架構之一。
展開架構 (Deployment Framework)

本公司的未來為何？ Vision
願景

Strategy
本公司如何達成願景 ? 策略方向

Strategic Objectives
本公司的策略量化目標為何 ? 策略目標

Key Performance Indicators 主要績效指標

如何全面衡量本公司績效水 Financial Customer
Internal Learning &
財務 Process Growth
準? 顧客
內部流程 學習成長

如何面對我們 希望我們的顧客 期望我們的作業 我們如何持續成長、

的股東？ 如何看待我們？ 流程表現如何？ 改善並創造價值？
平衡計分卡 (Balanced Scorecard) 的四個構面

財務
欲達成財務目標，我們該以
何種姿態面對股東？

內部流程 學習與成長
為滿足股東與顧客之需 遠景與 為達成企業遠景，我們該
求與期望，我們必須在 策略 如何保持學習成長，並進
那個流程上保持優勢？ 行必要的變革與改善？

顧客
既有及潛在的客戶如何
看待我們，我們如何繼
續提供價值給客戶？
 平衡計分卡的特色與效益
特色 (Characters) 效益 (Benefit)
由質化之願景與策略展開至可量 績效衡量指標皆為可充份衡量策略的成功
化的策略目標與績效衡量指標。 與否之「關鍵」「量化」指標。

由質化之願景與策略展開至可量 將策略轉換成組織內不同功能部門、不同
化的策略目標與績效衡量指標。 層次之營運績效指標：從全行、事業單位
、功能部門、工作團隊至個人。

四個衡量構面： 可平衡地衡量：
- 財務面 - 財務性 vs. 非財務性績效
- 顧客面 - 內部性 vs. 外部性績效
- 內部流程面 - 短期性 vs. 長期性績效
- 學習成長面 - 結果性 vs. 中間性績效

各衡量層面間具有因果關係：學 可協助進行績效成果追蹤分析，找出需改
習成長績效
習成長績效 內部流程績效 顧 善之績校因子，並據以規劃改善行動。
客績效 財務績效
 平衡計分卡四構面因果關係圖（策略圖）（例
）
藉由員工發展，高品質之產品與服務，
及員工、股東、顧客之滿意度提昇，成為世界級公司

財務面 顧客面 內部流程面 學習與成長面

股東價值 顧客滿意 流程效率 / 效果 員工滿意

營收成長

市場佔有率
營收成長
提昇整體服務
創造股東價值 品質提昇顧客
滿意
股價 外部顧客滿意度
EPS 帳單相關抱怨百分比
抱怨次數／顧客
改善
改善獲利 縮短服務時間 員工技能發展
供應商關係
利潤率 / 毛利率 供應商 / 企業夥伴滿意度 技術能力
滿足顧客需求之週期時間
資本報酬率 成功作業遵行要求百分比

生產力與效率 達成員工滿意
每位員工收益 員工滿意
 用表列方式呈現的平衡計分卡（例）

KPI 目標值 實際值 差異 行動方案 KPI 目標值 實際值 差異 行動方案

財務面 內部流程面
EPS 供應商／企業夥伴滿意度
營收成長
每位員工收益
利潤率 / 毛利率
成功作業遵行要求百分比
股價
資本報酬率
非交易來源收入百分比
市場佔有率

KPI 目標值 實際值 差異 行動方案 KPI 目標值 實際值 差異 行動方案

顧客面 學習與成長面
外部顧客滿意度 員工滿意
滿足顧客需求之週期時間 技術能力
帳單相關抱怨百分比
抱怨次數／顧客
Gartner Research 對 CPM/BSC 軟體看法
策略地圖的建立
策略地圖 (Strategy Map)
 完整的商業智慧整合解決方案
平衡計分卡 報表系統

績效衡量 (KPI)
商業智慧
 Scorecard Builder Architecture
Scorecard Strategy Map Data Data
Builder Builder Sources Entry
• UI for • UI for • Interface • Data
entering building to map entry
your your
scorecar strategy
scorecar
ds to
interface
for
Scorecard
d data
• Web
maps data custom Presentation
• Visio sources targets
Service

Scorecard • Understands
your BSC data
Engine • Builds the • Deploy your
scorecard scorecards
• Customize
your views
• Sharepoint
Portal
Server
• Captures • BSC-
• Scorecard- information specific
Source Scorecard created Scorecard about your web parts
cube(s)
Systems Cubes • SSABI-based,
DB • scorecard
SQL Server
customizable

ETL
Next Step? 科技
Technology
流程
Process
策略
Strategy

O 財務
商 L
E A 顧客
業 P
R 內部流程
智
P Data
慧 Mining 學習成長
 Managing
ManagingSupply
SupplyChain
ChainInformation
Informationat
atHBOS:
HBOS:
The
TheSRM
SRM(Supplier
(SupplierRelationship
RelationshipManagement)
Management)initiative
initiative

(Chapter
(Chapter 11)
11)
The case always generates much debate about the objectives of the system.
Taken at face value, the system is very successful, but a deeper analysis will
reveal that are potential difficulties with it. In particular

• Is the strategy chosen su/stainable?

• Is it in the long term interest of the bank to institutionalize adversarial
relationships ( 與供應商形成一種對立關係 ) with its suppliers via the
system?
• Is the architecture future-proof? ( 不會過時的技術 )

~ with 3 Questions for the case ~

 Question
Question 11
1. Which procurement decisions and activities
(Strategical, Tactical and Operational) and least well
supported by the new system?
【 A general way of SRM in Taiwan is having a series of Establishing Outsourcee
Evaluation Item Systems, including selection, counsel, guidance and assistance,
adopting QSA, QPA, etc. to do Surveying and Auditing. The approval system, for
Suppliers, Outsourcees, Offshorers, and Subcontractor is combined with Global
Logistics System and SCM, as one part of an integrated operation system. 】

※ 行銷大師菲利浦科特勒曾經將市場行銷問題歸結為三個重要的方面
：
戰略、戰術和可持續發展。並指出戰略的關鍵是定位，戰術的關
鍵是
差異化，而可持續發展的關鍵是品牌。
※ 戰略的觀念即為鬥智，亦為作戰指導，它包含了戰鬥的計畫和指導
，
戰術是一場戰役的行動，為戰鬥本身的計畫和執行而能擊敗對手
 Internal Business Process Measures
& the Balanced Scorecard (Source: Kaplan & Norton, 1996)
Model of Internal Business Process Logistics

Customer Innovation Operations Post-Sale Customer

Need Process Process Service Need Satisfied
Identified Process

Identify Create Build Deliver Service

Market Product Product Product to the
Customer

• Development • Quality • Delivery • Service

Relevant Cycle Time Defects Cycle Satisfaction
Metrics: Time
• MCE
Strategic level : ( 戰略 )
According to Walters (2002) the logistics strategy of an organization consists of “all the
strategic decisions, policies, plans, culture relating to the management of its supply chain”.
Strategic decisions in purchasing will therefore be concerned with determining the mission of
the purchasing function, decisions about principles and decisions about implementation.
HBOS seems to have set out (begun) on a cost reduction mission. The main strategic benefit
of the system is that it enhances HBOS’s power over its suppliers.
Through the system, HBOS has the ability to ‘realize’ the combined purchasing power of the 2
merged banks. Ultimately this could lead to a cost advantage for HBOS.

Tactical level : ( 戰術 )
The system aids analysis by presenting information to the purchasing team in a way that aids
tactical decisions and explore opportunities for saving. For instance, buyers have more
information available about suppliers and their performance, which helps the negotiation process.
Again is can be useful to add depth to the discussion here by asking students how supplier
performance seems to be measured by HBOS at the moment. More insightful answers would will
recognize that supplier performance only seem to be measured through price at the moment. Tan et
al. (2002) have shown that is increasingly becoming unusual with Quality levels, Service levels and
on-time delivery (QCD) ranked as the most important supplier evaluation practices by the companies
they surveyed.

Operational level : ( 營運操作 )

At an operational level, the system is of limited use in so far as ( 只要在 ... 的範圍內 )
no information exchange is currently taking place with suppliers. More insightful answers argued
that other secondary operational benefits are likely such as enhanced reporting information.
 Question
Question 22
2. Explain what is likely to have contributed to the success
of the project.
※ DeLone and McLean’s model (1992; 2003) is useful to explore system success.
 Question
Question 33
3. What challenges are facing HBOS on the road to ‘true’
Supplier Relationship Management?
Ward and Griffith’s (or McFarlan’s) Grid show that the system is evolving,
and the objective is to expand its true SRM functionality beyond the
decision support functions that are currently in use.
Some people will have realized that the system is seemingly designed to
improve HBOS’s bargaining power. This is recognized by Taylor when he
argues: “Unless purchasing is delivering significant savings, all its
other work is devaluated”.
There are no features in the system that seem to support ‘relationships’.
The new move into eauctions seems to confirm this strategy. We know for
instance that little or no electronic information exchange takes place with
suppliers. In moving to true SRM, HBOS may realize that its suppliers
are demanding more of a ‘win-win’ situation and they are unlikely to relish
collaborating with a system designed solely to drive prices down. At an
architecture level, the data-warehousing solution implemented is unlikely to
be well suited to supporting e-purchasing, and information exchange with
suppliers. It is therefore likely that the move to true SRM would require
substantial additional investment.
 xRM defined
(Extended Relationship Management…)

1. PRM - Partner Relationship

2. CRM - Customer Relationship
3. ERM - Employee Relationship
4. SRM - Supplier Relationship
5. ChRM - Channel Relationship
Supplier Relationship Management
- Objectives (SRM)

Source: JDEdwards.com
 System Success

Source: DeLone, W. H. & McLean, E. R. 2003

 Recent research:
opportunities and obstacles to SRM

• Increased customer service

• Increased Switching costs
• Increased Geographical Reach
• Be viewed as a technology leader
• Network and System instabilities
• Integration Difficulties
• Security Risks