SCOR vs. the Value Reference Model (VRM)

Today I got a very interesting question. Essentially, this company is looking to adopt a standard SCM business process model and is considering SCOR http://www.supply-chain.org/ versus the Value Reference Model (VRM) http://www.value-chain.org For many of my clients, SCOR is the de facto standard so it’s not often we get asked for alternatives. So I’m off to an inauspicious start here with my sourcing and supply chain advice blog since I don’t actually don’t have a great answer.

There are the obvious pros/cons here to consider – VRM is newer on the scene so less proven but that newness also means agility to update the process model as rapidly as the modern supply chain requires. On the flip side, SCOR is proven with a large number of clients to share best and worst practices with. Given the higher adoption, your odds of being able to actually do some meaningful benchmarking once you’ve rolled out the process model are much better. SCOR has been criticized for its inability to support the entire scope of the “value chain” but quite honestly, who are we kidding? I’ve never talked to a single company who has been able to roll out a process model that spans from product design to service and still maintains a level of detail that’s actually usable.

So what is the right answer here? My initial thinking is that a hybrid approach is the best one. Take the best of both process models and make them work for you. The issue I have is that I don’t know of any companies that have done this. So if anyone has done a detailed comparison between the two methodologies please drop me a note. I’d be really interested in hearing the results.

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  1. I am the enterprise business architect for a growing, multi-national, non-profit organization with annual revenues nearing $500M. Our organization required a business process modeling framework that addressed all facets of the enterprise. The following remarks explain why we selected VRM over SCOR as our reference framework for enterprise business process modeling.

    Both SCOR and VRM provide a hierarchical conceptual framework for contextualizing our business processes.

    At first we were strongly considering SCOR, which at release 9.0, in unquestionably mature.

    Even so, SCOR itself not a complete framework for the enterprise as it only addresses supply chain. When we reviewed the Design Chain Operations Reference (DCOR) and Customer Chain Operations Reference (CCOR) frameworks offered by the Supply Chain Council, we found them to be comparably immature when compared to SCOR. We found comparably fewer resources available for DCOR and CCOR and that represented a fundamental problem for us as we considered socializing these frameworks to our organization.

    In contrast, we found VRM to be a more complete framework for the addressing concerns of enterprise business architecture. VRM has an integrated framework that covers the domains of supply chain, product design, and customer relations.

    While VRM 3.0 is newer than SCOR 9.0, VRM 3.0 in my assessment is more complete and more normalized in the sense that all domains (supply chain, customer relations, product development) are receiving equal attention from the Value Chain Group in the scope, integration and evolution of the model. In contrast, while SCOR 9.0 in my assessment is very complete in its expression of the supply chain domain, the customer relations (CCOR) and product development (DCOR) domains of the reference model are conspicuously incomplete when compared to SCOR 9.0 and VRM 3.0

  2. Thanks, Chuck! All excellent points.

    I had a chance yesterday to check in with the folks over at the Value-Chain Group (VCG) and they were good enough to answer a few of my questions.

    Here’s a summary of the conversation:

    Question:
    When would VRM be a better fit for clients versus SCOR?

    VCG Response:
    When the client is pursuing model driven enterprise architecture or BPM centric approach.

    When processes involve connected value streams (spanning product development, sales, service, etc), not just supply chain management community.

    When customer wants to pursue a comprehensive transformation methodology because VRM is extensible with XRMs and SFDs, spanning all levels of modeling, analysis, blueprinting and SOA enablement

    Question:
    In your view, what are the key benefits?

    VCG Response:
    Speed and accuracy of transformation requirements determination, model based reuse, much more direct integration into run time architecture, complete value stream coverage and extensibility of the concept across all processes, suppliers, customers and industry standards.

    Question: Lastly, are times when you would not apply your framework
    and recommend SCOR?

    VCG Response:
    Only in cases when the scope is very narrow (SC only), transformation can be managed by few people, document based architecture is sufficient and the team does not require integration of processes within run time architecture based on SOA interfaces.

  3. Some Additional Thoughts

    Earlier in my career I worked as a lowly supply chain business analyst — toiling away at object oriented use cases, swim lanes and class diagrams. One of the main goals was to save time on the project by bringing the process design a step closer to the technical specifications used to build the system.

    We relied on industry standard OO process modeling tools and various document based frameworks but there was not a good base starting point to model supply chain entities. In a nutshell, this is what I think VRM is all about – giving the Enterprise Architect and Business Analyst a better head-start.

    My initial impression is that this is a supply chain process modeling tool that Enterprise Architects will really like – especially in industries like automotive where product design is a critical component.

    It will be less appealing and potentially overwhelming at first to process owners sitting in the lines of business tasked with documenting functional requirements.

    So far this has been a pretty one sided view in favor of VCG’s approach. A few notes on SCOR – It looks like TIBCO business studios supports the SCOR library. This is an alternative approach worth considering – especially if you are already running the Business Studio in house today.

    It also looks like SCOR uses IDS Scheer’s ARIS to visualize the reference model (http://www.ids-scheer.com/en/Software/ARIS_Reference_Models_/SCOR/81882.html) and that the Supply Chain Council had partnered with Proforma to restructure the model and publish it in a software agnostic open database.

    If anyone has a take on whether it was successful please let me know.

    VCG on the other hand has a proprietary business modeling tool. This is an important trade-off for enterprise architects to consider.

    High-quality solution design uses today’s collaboration networks to push these models to evolve quickly – characterized better as a living, organic process framework than as a rigid spec document. A big indicator which process framework is the most successful will be how many people take it and extend the base framework to really innovate. If you have the building blocks baked into a real BPM tool that’s awfully good starting point. If you have a way to collaborate with peers on extending an open procedss framework that’s even better. My thinking is that over the next few years this is where SCOR and VRM will go and that will be good for everyone.

  4. <>

    We have not found this to be a liability. In fact, we are using Sparx Systems Enterprise Architect (EA) and Business Process Model Notation (BPMN) 1.1 as our business process modeling tool and language standard, respectively. These are working well in concert with the modeling tool and Value Reference Model (VRM).

    To address the needs of the majority of business analysis/modeling stakeholders, we use this combination of EA and BPMN to provide them with the ability to describe their value chain scenarios as business process diagrams comprised of BPMN elements. For the sake of clarity, I will refer to the work products produced by this set of stakeholders as “value chain models”.

    The notion of a BPMN “activity” element (which is a link in a value chain model) maps perfectly to what VRM refers to as a “work unit”.

    Contextualizing each work unit in a value chains into the VRM is the responsibility of the enterprise business architect role.

    To address the needs of the enterprise business architect (EBA), we employ the VRM reference libraries (in PDF format) as well as the VCG modeling tool as resources. The work products produced by the EBA role are also BPMN models using the EA software.

    There are two major points that I am making here:

    1) The VCG’s proprietary tool is not broadly used in our institution. It is isolated to role of the enterprise business architect who is responsible for contextualizing the value chains produced by business process modelers into the VRM. So, the notion of a lot of people having to deal with a proprietary tool is not our reality.

    2) There is still a considerable amount of enterprise business architectural value to be realized when using the VRM and its tools in concert with a set of business analysts who are using an entirely different set of modeling software (i.e., Sparx Systems Enterprise Architect) and modeling languages (i.e., Business Process Model Notation). The big idea here is that the VRM is working for us even though we are using EA and BPMN.

    So, that accounts for the “important trade-off for enterprise architects to consider”, from my perspective as an enterprise business architect. The net effect from my perspective is that there is no trade-off.

    My two cents…fwiw…

  5. By the way, the preceding post was responding to the comment:

    “VCG on the other hand has a proprietary business modeling tool. This is an important trade-off for enterprise architects to consider.”

    I had bracketed this quote in my preceding post with double chevrons and the HTML encoding erase the entire quote. Oh well, so much for my use of netiquette. :-)

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