A method to compare supply chains of an industry

F. Jalalvand a
a
Department of Industrial Engineering, Iran University of Science and Technology
Tehran, Iran
fateme.jalalvand@gmail.com

E. Teimoury a
Teimoury@iust.ac.ir

A. Makui a
amakui@iust.ac.ir

M.B. Aryanezhad a
mirarya@iust.ac.ir

F. Jolai b
b
Department of Industrial Engineering, College of Engineering, University of Tehran, Iran
fjolai@ut.ac.ir
Abstract

Purpose – The purpose of this paper is to develop a method to compare supply chains (SCs)
of an industry in the scope of supplier's supplier to customer's customer.

Design/methodology/approach – The proposed method is based on five processes provided

in SCOR model version 9.0 (plan, source, make, deliver and return) and main business stages
of the industry. It uses Data Envelopment Analysis (DEA) and PROMETHEE II, a multiple
criteria decision making technique, as tools to compare SCs in the process level, business
stage level and SC level. Therefore, the method is basically a new combination of existing
models and methods including SCOR model, DEA and PROMETHEE II. To show the
applicability and strength of the method in comparing of SCs, it has been implemented in the
seven SCs of Iran broiler industry as a case study.

Findings – Comparing SCs of an industry via the proposed method results in process
benchmarking, business stage benchmarking and SCs ranking in the scope of supplier's
supplier to customer's customer.

Originality/value – The suggested method provides realistic and attainable information for
SCs' owner and managers to find out the strengths and weaknesses of their SCs and improve
their performance by process benchmarking and business stage benchmarking. Also they
could identify their competitive position in the industry by SCs ranking.

Key words comparison of SCs, business stage, SCOR model, Iran broiler industry

Paper type Research paper

1. Introduction
The comparison of supply chains (SCs), as influential systems in the business environment,
becomes important from two aspects. On the one hand, SCs owners and managers can find
out the strengths and weaknesses of their SCs and improve their competitive advantages via
comparing their SCs with the best and most effective SCs from different facets. This implies
benchmarking which has been widely investigated in the past literature as a management tool
for attaining or exceeding the performance goals (Anand and Kodali, 2008). Despite
increasing utilization of benchmarking in the organizations, a unifying theory to guide its
advancement has not been developed. Also models and frameworks that integrate many
aspects of organizational benchmarking have not been provided and advanced (Dorsch and
Yasin, 1998). This point fits precisely in the field of supply chain management (Wong and
Wong, 2006). On the other hand, SCs ranking is accomplished through accurate comparison
of SCs based on suitable criteria. SCs ranking can become important for several reasons. For
example, one of the important points for SCs' managers is their competitive position in the
industry. If they wish to know their competitive position among their competitors, SCs must
be properly ranked. Moreover, if a governmental organization tends to award the best and
most efficient SCs in a particular industry, it should rank those SCs accurately. Resource
allocating to the more efficient SCs of an industry also needs to rank them precisely. This
issue has not been sufficiently examined in the past studies, particularly models and methods
that rank SCs with different structures and strategies in the span of supplier's supplier to
customer's customer have not been introduced. In fact, past researchers such as Kirytopoulos
et al. (2008), suggesting a model to rank suppliers in pharmaceutical industry, have often
proposed models to rank special tiers of SCs rather than the whole SCs from supplier's
supplier to customer's customer.
This paper develops a method to compare SCs of an industry in the scope of supplier's
supplier to customer's customer. This method is based on five main processes of SCOR
model version 9.0 (plan, source, make, deliver and return) and industry's major business
stages. Data Envelopment Analysis (DEA) and PROMETHEE II, a multi criteria decision
making technique, are the tools that the proposed method uses to reach its purpose. DEA is
used to calculate the efficiency scores of processes for process benchmarking. Although the
SCOR model provides benchmarking data of its proposed metrics based on best-in-class
results of similar companies for its users, it does not present a total measure to evaluate
processes and compare them with each other easily and effectively. By using DEA, the
method considers processes as Decision Making Units (DMUs), calculates their efficiency
scores and provides appropriate reference processes for benchmarking. Then the method
computes the grades of business stages by aggregating the efficiency scores of their processes
using PROMETHEE II. Business stages of a given industry in the span of supplier's supplier
to customer's customer are the main activities to produce end products of that industry and
precisely defined in section 3. The grades of business stages could be used for business stage
benchmarking. At last the ranks of SCs, extended in the span of supplier's supplier to
customer's customer, are obtained by aggregating the grades of their business stages using
PROMETHEE II again.
The significant matter in the comparison of SCs is the selection of definable and applicable
criteria for all SCs with diverse structures and strategies. According to SCOR model version
9.0, like height, width and depth which are standard characteristics to describe a physical
object, five performance attributes of SCOR model including reliability, responsiveness,
agility, costs and asset management are standard characteristics to describe a SC. These
attributes allow a SC to be evaluated against other SCs with competing strategies. In other
words, without these performance attributes it is extremely difficult to compare an
organization that competes based on low-cost strategy against an organization that chooses to
compete on reliability. Hence, the proposed method uses these performance attributes as
suitable criteria to compare SCs. To show the strength and applicability of the method, it has
been implemented in the seven samples of SCs of Iran broiler industry. The paper is
organized as follows. Section 2 reviews the past literatures and applied methods in the SCs
comparison context. Then a brief introduction to the SCOR model, DEA and PROMETHEE
II technique are given. Section 3 presents the proposed method. Section 4 demonstrates the
obtained results from the implementation of the method in the seven SCs of Iran broiler
industry. Finally, some conclusions and future researches are given in Section 5.

2. Literature review
This section consists of four parts. First we present a brief review on the research works
discussed about SCs comparison issue. Then we give a short description of SCOR model,
DEA and PROMETHEE II consecutively.

2.1. Review of SCs comparison methods

The subject of SCs comparison consists of SC benchmarking and SCs ranking. According to
Anand and Kodali (2008), benchmarking is described as a self-improvement work in
organization by evaluating organization's current standards in strategies, functions,
processes, products or services, performances, etc and comparing them within or between
best-in-class organizations to change the scale or exceed those standards. This work is done
by acquiring information through proper data collection methods. SC benchmarking also has
been discussed in the past literature and includes several aspects such as processes,
performances, products and strategies (Wong and Wong, 2006). For example, Niemi and
Huiskonen (2008) have identified best logistical practice in some business units by utilizing
an internal benchmarking approach and Fawcett et al. (2009) have benchmarked the viability
of collaborative SCs business models for small businesses. In this field, process
benchmarking has been specially discussed. Andersen et al. (1999) have used benchmarking
in a project to enable industrial partners to learn from the best practices through identification
and study of other enterprises' processes. The work of Puschmann and Alt (2005), which
recognizes the need of an alignment of various e-procurement solutions along the
procurement process by benchmarking to integrate procurement solutions, is another
example. Although it could be claimed that SCOR model which provides benchmarking data
of its proposed metrics based on best-in-class results of similar companies, is the most
comprehensive model in process benchmarking, it does not present a total measure to
evaluate processes and compare them with each other easily and effectively. It seems using
some methods such as DEA to acquire a total measure for process benchmarking is very
useful. The precise review of the past literature in the SC benchmarking is not the aim of this
paper. Wong and Wong (2006) have surveyed SC benchmarking literature in detail and
revealed the problems associated with this field. Some of these problems are bulleted as
below:
• Past literatures on SC performance benchmarking had not considered SC as a whole
entity. Therefore, it is hard to evaluate performance if there are various inputs and outputs
to the system with complex relationships to each other.
• Past studies had been unsuccessful in concerning the collaborative relationships
particularly in the area including joint decision making.
They have imported that one of the robust, standard and transparent methodology which
made it appropriate as a SC benchmarking tool is DEA. DEA calculates efficiency without
the need to determine the relationships among performance measures. It also specifies
appropriate references for benchmarking.
Another face of SCs comparison is SCs ranking. Most studies about SCs ranking suggest
models and frameworks in order to rank a part of SCs or indeed special tiers. For instance,
Bhuttaand and Huq (2002), Shore and Venkatachalam (2003), Teng and Jaramillo (2005),
Liu and Hai (2005), Bottani and Rizzi (2006), Wong and Wong (2007), Pressey et al. (2007),
Levary (2007), Kirytopoulos et al. (2008), Buyukozkan et al. (2008) and Wu and Blackhurst
(2009) have proposed models to rank special tiers such as suppliers, manufacturers or 3PL
(Third Party Logistics) service providers. In the most of the above mentioned works, a
multiple criteria decision- making (MCDM) model such as AHP (Analytical Hierarchy
Process), TOPSIS (Technique for Order Preference by Similarity to Ideal Solution) or DEA
has been applied to rank and select the most appropriate suppliers, manufacturers, etc. For
instance, Wu and Blackhurst (2009) have offered a supplier evaluation methodology based on
augmented DEA and Bottani and Rizzi (2006) have presented a multi-attribute approach
based on TOPSIS technique and the fuzzy set theory for selection and ranking of the most
suitable 3PL service providers. Although ranking similar tiers of SCs by these methods is
practical, the problem becomes more complicated and these methods are not usable if our
purpose is comparing and assessing SCs in the scope of supplier's supplier to customer's
customer with different structure and strategies. Besides above researches, some
investigations have compared SCs based on specific aspects like managerial, behavioral and
relational facets. For example, Burcher et al. (2005), Wiley et al. (2006), Burcher et al.
(2007), Golicic (2007), Halldorsson et al. (2008), Thakkar et al. (2008) and Mena et al.
(2009) have suggested issues such as managers' perspectives, interorganizational
relationships and network relations as basics of SCs comparison. In these works, the main
issue is evaluating the relational and behavioral aspects in SCs not assessing the elements of
SCs especially in the in the scope of supplier's supplier to customer's customer.
Therefore, a method or model which can evaluate and compare SCs with different structures
and strategies from supplier's supplier to customer's customer has not been introduced yet.
This article proposes a method to compare SCs of an industry from supplier's supplier to
customer's customer in the platform of SCOR model and main business stages of the industry
using DEA and PROMETHEE II. Capturing SCs based on business stages similar for all SCs
rather than companies different from one SC to another, decomposing business stages into
processes of SCOR model, using DEA to calculate efficiencies of processes based on their
related metrics and employing PROMETHEE II as one of the multiple criteria decision-
making (MCDM) technique to obtain the grades of business stages and ranks of SCs are the
main steps of the proposed method. In other words, this method uses the advantages of SCOR
model, DEA, PROMETHEE II techniques and the business stage concept simultaneously to
compare and evaluate SCs from supplier's supplier to customer's customer. The results are
process benchmarking, business stage benchmarking and SCs ranking.

2.2. SCOR model

The SCOR model, published in 1996 by Supply Chain Council (SCC), is based on the
concepts of business process reengineering, benchmarking and process measurement. This
model provides a common process oriented language which helps SC partners to
communicate with each other (Lockamy and McCormack, 2004). It spans all customer
interactions, all physical material transactions and all market interactions from supplier's
supplier to customer's customer. The Model is organized around the five primary
management processes of Plan, Source, Make, Deliver, and Return (SCOR model version
9.0). Five performance attributes of SCOR model, involving reliability, responsiveness,
agility, cost and asset management are standard characteristics to describe a SC that allow it
to be evaluated against other SCs with competing strategies . The SCOR model is
hierarchical. It has three process levels that lower levels are sub processes of higher levels.
Level 1 (top level) defines the scope and content of the SC, level 2 (configuration level)
describes configuration of the SC based on process categories and level 3 (process element
level) gives detailed information for each process category of level 2 based on process
elements. Performance metrics in any level are given in conjunction with five performance
attributes to evaluate processes of that level. Except level 1 metrics, which do not necessarily
relate to a SCOR level 1 process (SCOR model version 9.0) and present a view of overall SC
performance (Theeranuphattana and Tang, 2008), level 2 and level 3 metrics evaluate
performance of processes associated with their levels. Having above characteristics, SCOR
model enables SCs to benchmark against others in both overall SC and their processes. The
usefulness of SCOR has been verified. The report of Geary and Zonnenberg (2000) in the
benchmarking study conducted by the Performance Measurement Group, have shown that the
best-in-class SCs have gained considerable financial and operating advantages compared to
their peers by using the SCOR model (Wong and Wong, 2006). Although the metrics related
to processes of level 2 and 3 can be applied for process benchmarking, using models such as
DEA to aggregate these metrics to a common measure facilitates the process benchmarking
effectively and enables mangers to evaluate and improve their processes based on the
common index.

2.3. Data Envelopment Analysis (DEA)

DEA model was first introduced by Charnes, Cooper and Rohdes (1978) and became popular
as CCR (comes from the first letter of the name of above persons) model. DEA analyses
DMUs (Decision Making Units) and evaluates their relative efficiency scores based on linear
programming. DMUs often have multiple inputs and outputs as performance measures. The
efficiency score is defined as a ratio of weighted sum of outputs to weighted sum of inputs.
The weights are calculated in a way that highest possible relative efficiency score to a DMU
is assigned. So far many different types of DEA models with different aims have been
developed. In most of them like CCR, if DMUs are efficient, their efficiency scores are equal
to 1 otherwise if they are inefficient, their efficiency scores are between 0 and 1. Although
ranking inefficient DMUs, these models can not specify the preferences of several efficient
DMUs with 1 efficiency score. In fact, if there are several efficient DMUs with 1 efficiency
score, it is impossible to rank them with classic DEA models. A modified version of DEA
models based upon comparison of efficient DMUs is developed by Andersen and Peterson
(1993) and called AP model. The AP model provides a framework for ranking efficient
DMUs and facilitates comparison of them by assigning efficiency scores more than 1 to
efficient units (Andersen and Petersen, 1993).
DEA has been widely applied in measuring efficiency in benchmarking issues for example in
telecommunications industry (Collier and Storbeck, 1993), banking and finance industry
(Barr and Seiford, 1994) and grocery industry (Athanassopoulos and Ballantine, 1995).
Because benchmarking of performances stems from the foundations of efficiency
measurement and then ranking of efficiency measured, DEA is considerably applied in
benchmarking in various applications as an efficiency measurement tool. But its applicability
in SC performance measurement has not so far been reported (Wong and Wong, 2007).
According to Wong and Wong (2006), one of the robust, standard and transparent
methodology which made it appropriate as a SC benchmarking tool is DEA. Wong and Wong
(2006) have specified factors for suitability of DEA as a SC benchmarking tool. Some factors
referred by them are:
• DEA calculates efficiency without the need to determine the relationships that relate
performance measures or tradeoff among them.
• DEA has features which allows managers to analyze a large number of inputs and outputs
both quantitative (i.e. time, cost) and qualitative (i.e. reliability, quality) based on
different scales.
• DEA specifies both appropriate reference DMUs for benchmarking and efficiency
parameters which are useful to determine realistic and attainable benchmarks.
Wong and Wong (2007) have employed DEA to measure internal SC performance within
manufacturing firms. They have applied the model in 22 companies by taking them as DMUs
and calculate their efficiencies to analyze the performance of companies and take right
remedial actions for continuous improvement. In other work, Wu and Blackhurst (2009) have
proposed a supplier evaluation and selection methodology based on DEA by taking supplier
companies as DMUs. Although considering companies as DMUs is helpful to analyze the
total performance of them, for more examination it is better to take composing elements of
companies like processes as DMUs. Hereby, the companies are not evaluated as a black box
and their performance are precisely estimated by efficiency scores of their business
processes.

2.4. PROMETHEE II
PROMETHEE methodology, a Multi Criteria Decision Making (MCDM) technique, was first
developed in 1982 by J.P. Brans (Brans and Mareschal, 2005). This methodology includes
various types such as PROMETHEE I (partial ranking), PROMETHEE II (complete ranking)
and PROMETHEE III (ranking based on intervals) applied in different conditions for
different purposes. According to Brans and Mareschal (2005), a large number of fields such
as Banking, Manpower planning, Industrial Location, Investments, Water resources,
Medicine, Chemistry, Health care, Tourism, Ethics in OR and Dynamic management have
successfully applied the PROMETHEE methodology. They have emphasized that
mathematical properties and friendliness of use are the reasons of success of the
methodology. The PROMETHEE II, which ranks alternatives completely, requires very clear
information for both the analysts and the decision-makers. These information include
decision making matrix that contains decision maker's trade-offs data between alternatives in
any criterion, weights (relative importance) of the criteria and preference functions. The
PROMETHEE methodology prefers and prioritizes alternatives based on pairwise
comparisons. In other words, the deviation between the evaluations of two alternatives on a
particular criterion is specified. Preference functions convert this deviation to a number
between 0 and 1 and present the preference of decision maker between alternatives in each
criterion .The larger the number, the higher the preference. Brans and Mareschal (2005) have
proposed six types of preference functions. Decision maker can employ either these
preference functions or his own arbitrary preference function. Next section describes the
method that compares SCs of a given industry.

3. The supply chains comparison method

The proposed method to compare SCs has five phases described as follows:
Phase1. Determining business stages: The industry's business stages in the extent of
supplier's supplier to customer's customer are determined in this phase. Business stages of a
particular industry are the main operations and activities which are performed to acquire row
materials and convert them to the final products consumed by the end customers. The experts
and practitioners of the industry must agree with the definition of the industry's main business
stages. For example, the business stages of Iran broiler industry can be defined as Grand
Parents production (GP), parents production, broiler production and processing stages which
are explained in detail in section 4. The number and the type of business stages in the extent
of supplier's supplier to customer's customer are similar for all SCs of an industry and
independent from the number of companies forming different SCs. Therefore, considering the
business stages as composing elements of SCs rather than companies enables us to compare
SCs of an industry in the span of supplier's supplier to customer's customer. Due to
considering SCs based on companies, past researches had been unsuccessful to compare and
rank them in the span of supplier's supplier to customer's customer. It should be noted that a
company in a particular SC may include one business stage or several business stages
according to the main operations and activities executed in it. Also some business stages may
be common in several SCs (like a distribution center which distributes the products of several
manufacturers). The proposed method covers above issues and they do not affect the
comparison of SCs based on business stages.
Phase 2. Decomposing business stages into processes: In this phase the business stages are
decomposed into SCOR level 2 processes (process categories). As mentioned earlier, at level
2 the configuration of a SC is specified using process categories. Except plan process which
includes four process categories (P1, P2, P3, P4), the rest of processes like source (S1, S2,
S3) have three process categories. Process categories are configured in line with operation
strategies of SCs (Theeranuphattana and Tang, 2008). For instance, (M1) make-to-stock,
(M2) make-to-order and (M3) engineer-to-order are configuration types of make process.
Figure 1 illustrates a particular SC in the Iran broiler industry that its business stages have
been decomposed into process categories. In Figure 1 bold vertical lines separate companies
and dashed vertical lines separate business stages. Therefore, company B includes three
business stages while company A contains only one business stage. As mentioned earlier, a
company in a particular SC may include one or more business stages but the number and type
of business stages are similar for all SCs of an industry and independent from the number of
companies composing SCs.
Take in Figure 1
Phase 3. Calculating process efficiency scores: This phase calculates the efficiency scores of
processes, configured in previous phase, using DEA. To do it, same processes are considered
as homogenous DMUs. Because the same processes in the same business stages in the same
industry have similar nature, they can be considered as homogenous DMUs whose efficiency
scores are computable using DEA. Hence, plan process categories are taken with each other,
source process categories are considered with each other and so on. Considering performance
metrics suggested by SCOR model to evaluate process categories, it clarifies that the type and
the number of performance metrics assigning to evaluate each type of process categories like
(S1, S2, S3) are very similar and they differ from each other in only one or two metrics.
Therefore, the common and similar metrics for each type of processes like (S1, S2, S3) can
be applied to assess that type. In this phase, input and output variables are chosen from these
common metrics depicted in Table 1. Because performance metrics are defined in
conjunction with five performance attributes which are reliability, responsiveness, agility,
cost and asset management consequently these attributes are the criteria to evaluate the
processes or indeed the SCs. Decision makers or industry's practitioners and experts who tend
to compare SCs, are responsible for selecting input and output variables among common
metrics in Table 1.
Take in Table 1
Evaluating efficiency scores of processes by considering them as DMUs results in the
following advantages:
• The most efficient processes can be considered as benchmark references for the rest of
processes in each business stage. Also the inefficiencies sources of other processes are
precisely and effectively specified. This helps SCs' owners and managers to improve the
performance of their processes by process benchmarking.
• The strengths, weaknesses and causes of inefficiency in the SCs are precisely clarified
based on their processes.
So, the consequence of this phase is process benchmarking, as one of the aims of this study.
Phase 4. Specifying business stages grades: This phase aggregates the efficiency scores of
processes to obtain the grades of business stages using PROMETHEE II. To do it, suppose
that m SCs in a given industry with n business stages must be compared with each other
(Figure 2). In Figure 2 vertical lines separate companies and a company may include several
business stages. For example, in SC 1 a company contains stage 2 and stage 3. Hence, as
mentioned earlier the number of companies may differ from one SC to another, but their
business stages are equal.
Take in Figure 2
The efficiency scores of processes belonging to a particular business stage in m SCs are
placed in matrixes as shown in Figure 3. So, n matrixes (the number of business stages) with
m rows (the number of SCs) and six columns (the number of process types) are made. By
considering these matrixes as decision making matrixes the grades of business stages,
illustrated in Figure 3 by α ij , are obtained using PROMETHEE II. The α ij indicates the

grade of business stage j in SC i . The weights (importance) of processes and preference

functions are determined by decision makers or industry's practitioners and experts. Similar
to previous phase, SCs' managers in this phase can take into account business stages with
highest grades as references for benchmarking to enhance the performance of their business
stages.
Take in Figure 3
Phase 5. Determining SCs ranks: The ranks of SCs are acquired by aggregating their
business stages grades using PROMETHEE II again. The business stages grades of all SCs
construct a decision making matrix as illustrated in Figure 4. Like prior phase, the weights
(importance) of business stages and preference functions are obtained based on judgments of
decision makers or industry's practitioners and experts. In Figure 4 the rank of SC i is shown
by β i . A diagram of phases which must be tracked in the proposed SCs comparison method is
depicted in Figure 5.
Take in Figure 4
Take in Figure 5

4. Case study
The proposed method presented in the previous section, was implemented in the seven
samples of SCs of Iran broiler industry. Iranian broiler SCs or chicken SCs have several
stages to produce chicken products including Grand Parents production (GP), parents
production, broiler production and processing stages explained in detail in the following.
Besides complete structure from supplier's supplier to customer's customer in which the
products of previous stages are the raw materials of further stages, these SCs have a
complicated nature to evaluate due to their structures. These points conducted us to select
SCs of Iran broiler industry as a suitable case for implementing the proposed method.
Nevertheless, choosing Iran broiler industry does not mean the proposed method is especially
designed for broiler industry. Other sectors and industries such as automobile industry,
electrical equipment industry, etc can easily and effectively evaluate the processes and
business stages of their SCs as well as the whole SCs by applying the method step-by-step.
However, executing the method is a time-consuming procedure due to the need to data
gathering and interaction with experts and practitioner of the industry through interviews,
questionnaires, etc. Especially determining the business stages of industry is the most critical
issue in the applying of the method which should be carefully performed according to the
comments of industry's experts. If business stages are precisely defined, implementing the
rest of the method will be a straightforward task.

The selected SCs of Iran broiler industry have been called SC1, SC2, SC3, SC4, SC5, SC6
and SC7. Consulting by the directorates and experts of the Iran ministry of Jihad-e-
Agriculture conducted us to select above SCs. SC1, SC2 and SC3 are vertically integrated
from supplier's supplier to customer's customer. They have well-known brands in the chicken
market and are very successful in their business. Nevertheless, they have captured less than 5
percent of market share due to the dominance of non-integrated structure in the Iran broiler
industry. In fact, most of the activities in this sector are performed independently. SC4, SC5,
SC6 and SC7 were chosen among this structure. In the each of the above SCs three
companies work together to produce chicken products consumed by end consumers.
Although these SCs have similar structure, their business styles are different from each other.
In the SC4, SC5 and SC6, companies have strong collaboration with each other and do not
change their partners in diverse market conditions. They associate based on collaborative
relationships. Contrary to these SCs, the elements of SC7 have not enough collaboration and
may rupture their partnership in different circumstances. That is to say, companies of SC4 to
SC6 earn more profit in the market prosperity and aid each other in the slump conditions
through collaboration. Whereas, the companies of SC7 only think about their benefits in good
circumstances and may change their partners. In unfavorable conditions they cannot undergo
the sufferings and may go bankrupt. We chose three SCs from integrated structure, three SCs
from collaboration structure and one SC from fully independent structure as samples of their
business style.

This section gives the consequences of execution the proposed method in the above-
mentioned SCs. The results are demonstrated according to the method phases.

Phase 1. Determining business stages: Main business stages of Iran broiler industry were
identified in this phase. Different ways like observation of SCs and discussions and
interviews with industry experts was applied to recognize business stages. Three directors of
integrated SCs, managers of each of the companies composing SC4, SC5 and SC6, three
experts from SC1, three experts from Iran ministry of Jihad-e-Agriculture and a practitioner
from day old breeder chicks association are the persons interviewed. Every session was
approximately lasted two hours and discussions were recorded. Some experts such as the
directors and experts of SC1 and SC3 and the experts of Iran ministry of Jihad-e-Agriculture
were repeatedly discussed. The topics of sessions were around the main operations and
activities from supplier's supplier to customer's customer performed to acquire row materials
such as feeds and day old chicks to convert them to the chicken meat and other products
consumed by consumers. As a result, the business stages of Iran broiler industry were defined
as Grand Parents (GP) production, parents production, broiler production and processing
stages. Figure 6 shows the business stages of Iran broiler industry. The activities and
operations accomplished in the above stages to produce their products and deliver them to the
next stage are too complex to explain exactly, and complete elucidating of them is not the
intention of this paper. The activities of each stage can be summarized and simplified as
follows:
The products of the GP production stage are day old breeder chicks which are delivered to the
parents production stage and grown in this stage to produce broiler eggs. Day old broiler
chicks, gained from broiler eggs, mature in the broiler production stage and become
slaughterable birds. These birds are slaughtered and processed in the processing stage and
then delivered to the end customer for food consumption. In the seven studied SCs, the GP
production stage is done by one company. Therefore, it is similar for all SCs and was ignored
in the comparison of them. So, parents production, broiler production and processing stages
were only analyzed for the comparison of seven SCs.
Take in Figure 6
Phase 2. Decomposing business stages into processes: The decomposition of parents
production, broiler production and processing stages into process categories was the result of
this phase. Like the previous phase, observation from parents production, broiler production
and processing stages of various SCs and interviews, which were structured based on SCOR
model definitions of processes and distributed among above mentioned practitioners, were
tools to achieve this intent. Because all of SCs in the Iran broiler industry compete based on
demand forecasting, the configuration of process categories for all of them is S1 (source
stocked product), M1 (make-to-stock) and D1 (deliver stocked product). In addition, return
process has not been defined in the broiler industry due to the nature of its products. Figure 7
depicts the structure of SC1, SC2 and SC3. As mentioned earlier, in these SCs one company
comprises the entire business stages and they have similar structure called integrated
structure. As shown in Figure 8, SC4, SC5, SC6 and SC7 whose business stages are
performed in distinct companies have also similar structure. Nonetheless as suggested before,
the elements of SC4, SC5, and SC6 have strong partnership with each other and associate
based on collaborative relationships while there is not enough collaboration among the
companies of SC7 and they change their partners based on market conditions.
Take in Figure 7
Take in Figure 8
Phase 3. Calculating process efficiency scores: Recognizing influential and relevant metrics
in evaluation of processes based on Table 1 metrics and specifying their types (input or
output) was the first action done in this phase. To do it, type 1 questionnaires, structured
based on SCOR level 2 processes, were mailed to the 50 practitioners of parents production
stage, 50 experts of broiler production stage and 40 practitioners of processing stage. The
numbers of practitioners were determined based on availability of them in Tehran and north
of Iran. They were not only the managers and experts of selected SCs but also the members
of day old breeder chicks association, Tehran and north of Iran broiler farmers unions, Tehran
slaughterhouses union and the experts of Iran ministry of Jihad-e-Agriculture itself. 35
parents production questionnaires, 40 broiler production questionnaires and 30 processing
questionnaires were completed and returned resulting in response rates of 70 percent to the
parents production questionnaires, 80 percent to the broiler production questionnaires and 75
percent to the processing questionnaires. Table 2 indicates the distributions of those experts
in different sections, number of completed questionnaires and the response rates. The answers
were validated via interviews and telephone calls with practitioners.
Take in Table 2
The second action was data collection from seven SCs by type 2 questionnaire, constructed
based on influential metrics determined by type 1 questionnaires. The data belong to the year
2007. Tables 3, 4 and 5, provide influential metrics in every stage, the type of them and their
values in the seven SCs. In these tables some points should be attended as follows:
• Because the stages' costs are proportionate to their production capacity and the higher the
production capacity the more the costs, to normalize and homogenize cost metrics they
are divided to the production capacity of their stages.
• In the SCOR model version 9.0 product acquisition costs are defined as costs incurred for
the production of product for example product management and planning costs, supplier
quality engineering costs, etc. Therefore, the product acquisition costs in the parents
production and broiler production stages can be seen as quality of day old chicks, which
 are acquired from previous stage, and quality of feed. The higher the product acquisition
costs, the better the quality of feed and day old chicks.
• The perfect order fulfillment metric in broiler stage is equivalent to production number
(PN) index which is a measure have been defined in broiler industry to address points
approximately similar to reliability parameters.
• Qualitative metrics such as feed quality are scaled with likert scale. The higher the
number the better the performance of stage.
• In the processing stage, influential metrics signified by experts are cost to source in
source process, cost to make in make process and cost to deliver and cash-to-cash cycle
time in deliver process. Because few metrics were available to determine both input and
output variables for source and make processes (less than 2), source, make and deliver
processes were merged, called integrated process (IP) and considered as one DMU whose
input variable is total costs (sum of cost to source, cost to make and cost to deliver) and
output variable is cash-to-cash cycle time.
• One company performs processing stage for SC5 and SC6 thus they are similar in
processing stage.
Take in Table 3
Take in Table 4
Take in Table 5
The efficiency scores of processes were calculated by DEA Online Software (visit
www.deaos.com) based on output oriented AP model and placed in matrixes as shown in
Figure 9. Most efficient processes are marked with * and can be considered as benchmark
references for other processes.
Take in Figure 9
As seen in Figure 9, for example, the plan process of SC5 in the parents production stage is
the most efficient process among other plan processes of this stage. From Table 3, the
environmental compliance cost/ capacity for SC5 is 0.49 million I.R.I Rials, the return on
supply chain fixed assets is 1.94 and the return on working capital is 3.93. Although the
environmental compliance cost of SC5 is higher than that of other SCs, because of the good
asset management, the return on supply chain fixed assets is greater than that of other SCs
and the Return on working capital is the second value among the rest. Therefore, the plan
process of SC5 has become the most efficient plan process in the parents production stage.
Achieving these targets, can be examined by owners and managers of other SCs, and are
considered as pattern to improve performance of plan processes in parents production
stages. As another example, the plan process of SC1 in the broiler production stage has the
highest efficiency score among the rest. Although in this case, plan process of SC3 is
efficient too, its efficiency score is lower than that of SC1. Thus, the metrics values of plan
process of SC1 can be taken as benchmark targets for other plan processes in this stage. In a
similar way, determining benchmark targets for other processes can be explored from Table
3, 4 and 5. Figure 9 shows clearly that all of the most efficient processes belong to either
integrated SCs such as SC1 or collaborative SCs such as SC5. This result emphasizes the
importance of collaboration among partners to achieve better performance.

Phase 4. Specifying business stages grades: The grades of parents production, broiler
production and processing stages, obtained using PROMETHEE II, were the outcomes of this
phase. To acquire these results, the Figure 9 matrixes were taken as decision making matrixes
and the weights (importance) of the processes, illustrated in Table 6, were gained via the type
1 questionnaires. V-shape preference function was selected among six preference functions,
recommended by Brans and Mareschal (2005), for all criteria (processes) in interaction with
practitioners of each stage. Also parameter p was specified 0.05 for all criteria (processes).
Parameter p in the PROMETHEE II method is a smallest deviation which is considered as
sufficient to create a full preference (Brans and Mareschal, 2005).

Take in Table 6
In Figure 10, the values of the left, middle and right columns are the parents production
stage grades, broiler production stage grades and processing stage grades respectively in
SC1 to SC7. The highest grade stages are signified with * and other stages can benchmark
from these stages to improve their performance. For instance, the parents production stage
of SC3 has the greatest grade among that of other SCs and can be considered as reference
benchmark for other parents production stages.

Take in Figure 10
Although different types of preference functions could be used for any criterion, consulting
with analysts, decision makers (industry's experts) concluded that the V-shape preference
function can reflect their utilities in each criterion. In other words, the higher the values of
business stages in each process, the better the preference of decision makers, and these
preferences in all processes (criteria) increased almost linearly similar to V-shape preference
function. But the preference functions may potentially influence the results. By changing the
preference functions, the grades of business stages may become different. For more
examination, the U-shape preference function (q equal to 0.05) and level preference function
(q equal to 0.05, p equal to 0.1) were also used to obtain the grades of parents, broiler and
processing stages considering the matrixes of Figure 9 as decision making matrixes and the
values of table 6 as weights of processes. The results are given in Figure 11 and Figure 12.
Similar to Figure 10 the highest grade stages are signified with *. Comparing the values of
Figure 10, Figure 11 and Figure 12, it clarifies that the ranks of parents, broiler and
processing stages have not altered but their values slightly changed. As a result, owners and
managers of SCs can more certainly consider the stared stages as references for business
stage benchmarking. Although using different preference function has not affected the ranks
of business stages in this case, it may change the results in other circumstances and should be
concerned by analysts and decision makers.
Take in Figure 11
Take in Figure 12

Phase 5. Determining SCs ranks: By considering the matrix of Figure 10 as a decision

making matrix in PROMETHEE II, the rank of SCs were computed based on equal weight
for all stages (0.33) and V-shape preference function with 0.1 parameter p which were
determined in interaction with experts. The results are given in Table 7 showing SC2 has the
highest rank while SC7 lies in the lowest rank. By using these results SCs' owners and
managers can realize their competitive position in the broiler industry and enhance the
performance of their SCs based on main processes and business stages of them.

Similar to previous phase, different preference functions may result in different SCs ranks.
To analyze this issue two type of preference function (U-shape and level) were used. The U-
shape preference function (q equal to 0.01), matrix of Figure 11 as decision making matrix
and equal weight for all stages (0.33) resulted in the ranks presented in the middle column of
Table 7. The level preference function (q equal to 0.01, p equal to 0.1), matrix of Figure 12
as decision making matrix and equal weight for all stages (0.33) ranked SCs as shown in
the right column of Table 7. By considering the ranks of SCs with diverse preference
functions in Table 7, different preference functions have not changed the ranks of SCs in
this case.

Take in Table 7
5. Conclusion and future research

This paper proposed a method to compare SCs of an industry with different structures and
strategies in the scope of supplier's suppliers to customer's customers in 5 phases. Phase 1
determines business stages of the industry which are main activities to produce end products.
Phase 2 decomposes business stages into process categories of SCOR model. By taking
processes as DMUs in DEA model, the efficiency scores of them are calculated using DEA
and process benchmarking is consequently achieved in phase 3. Phase 4 specifies business
stages grades using PROMETHEE II and results in business stage benchmarking. The ranks
of SCs are determined in phase 5 using PROMETHEE II again. In fact, the advantages of
SCOR model, DEA, PROMETHEE II techniques and the business stage concept are
simultaneously used by the method to evaluate SCs from supplier's supplier to customer's
customer. There are several important points in this method. Firstly, comparison of SCs in the
scope of supplier's supplier to customer's customer is a new approach which has not been
concerned in the past studies. In that respect one of the main contributions of this paper is
considering SCs based on business stages which are similar for all SCs of an industry rather
than companies differing from one SC to another. Secondly, process benchmarking and
business stage benchmarking provides detail information for managers to evaluate their SCs
from supplier's supplier to customer's customer. Especially, this method gives a common
measure for assessing processes of SCOR model and completes the benchmarking procedure
suggested by SCOR model which is only based on its metrics. Finally, ranking SCs from
supplier's supplier to customer's customer including suppliers, manufacturers, retailers, etc by
the proposed method opens a new horizon in the SCs ranking subject and gives the possibility
to evaluate and compares the whole elements of SCs in the scope of supplier's supplier to
customer's customer. The method was implemented in the seven samples of SCs of Iran
broiler industry and the obtained results show the strength of method in accurate and effective
evaluation and comparison of SCs. By following the phases of the method step-by-step, the
other sectors and industries can also evaluate their SCs based on processes, business stages
and the whole SCs.

Despite the high capability and applicability of the proposed method in the evaluation and
comparison of SCs, there are some constraints and implications in this method. Firstly, the
data collection from industries' expert and practitioners and SCs themselves by interviewing,
distributing questionnaires, etc is a time-consuming process. It should be precisely performed
because the results are based on the deterministic data and the precision of data influence
directly on the accurate process and business stage benchmarking and SCs ranking. In this
respect, using some models covering the imprecision data such as Fuzzy-DEA instead of
DEA would be helpful. Secondly, the results of the method could be analyzed by examining
the other MCDM techniques such as TOPSIS. Lastly, this method compares SCs at a
specified time while the subject of SCs comparison can be investigated dynamically in a time
horizon. In other words, because the SCs operates in a dynamic environment the efficiencies
of processes, the grades of business stages and the ranks of SCs in the future can be analyzed
by forecasting. This helps managers to establish strategies and execute operations which
enhance the performance of their SCs in the future.

Acknowledgments

The authors would like to thank the two anonymous referees for their constructive
comments, which helped strengthen the paper significantly.

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www.DEAOS.com
Performance SC Reliability SC Responsiveness SC Agility SC Costs SC Asset Management
Attributes

Process Type

None Identified Plan Cycle Time, None Identified Cost to Plan supply chain Return on Supply Chain Fixed
Order Fulfillment Cycle Time Cost to Plan (S or M or D) Assets,
PLAN
Environmental Compliance Return on Working Capital,
(P1, P2, P3, P4)
Cost Cash-To-Cash Cycle Time

Perfect Order Fulfillment Source Cycle Time, None Identified Product Acquisition Costs Return on Supply Chain Fixed
Order Fulfillment Cycle Time Cost to Source Assets,
SOURCE Return on Working Capital,
(S1, S2, S3) Inventory Days of Supply
(Raw Material)

Yield, Make Cycle Time, Upside Make Adaptability, Cost to Make, Inventory Days of Supply
Perfect Order Fulfillment Order Fulfillment Cycle Time Downside Make Cost of Goods Sold (WIP),
Adaptability, Return on Supply Chain Fixed
MAKE
Upside Make Flexibility Assets,
(M1, M2, M3)
Return on Working Capital,
Cash-To-Cash Cycle Time,

Perfect Order Fulfillment Deliver Cycle Time, Upside Deliver Adaptability, Cost to Deliver, Return on Supply Chain Fixed
Order Fulfillment Cycle Time Downside Deliver Finished Goods Inventory Assets,
DELIVER
Adaptability, Days of Supply, Return on Working Capital,
(D1, D2, D3)
Upside Deliver Flexibility Order Management Costs Cash-To-Cash Cycle Time,

% of Excess Product Returns
Delivered Complete to the
RETURN (source)
Designated Return Center
(SR1, SR2, SR3)
Source Return Cycle Time,
Order Fulfillment Cycle Time
None Identified Total Excess Material Return
Costs,
Cost to Source Return
Return on Supply Chain Fixed
Assets,
Return on Working Capital,
Rebuild or recycle rate,
Table 1. common metrics of one kind process categories

% of MRO/ Excess returns Deliver Return Cycle Time, Upside Deliver Return Cost to Deliver Return Return on Supply Chain Fixed
delivered to the correct service Order Fulfillment Cycle Time Flexibility, Assets,
RETURN (deliver) provider location Upside Deliver Return Return on Working Capital,
(DR1, DR2, DR3) Adaptability Return rate,
 Table 2. Type 1questionnaires distributions and experts features
Business stage
Parents Broiler Processing
production production

Number of SCs experts 10 10 7

Number of day old breeder chicks 35 - -

association experts

Number of Tehran broiler farmers - 18 -

union experts

Number of north of Iran broiler - 15 -

farmers union experts

Number of Tehran - - 26
slaughterhouses union experts

Number of Iran ministry of Jihad- 5 7 7

e-Agriculture experts

Total 50 50 40

Number of completed 35 40 30
questionnaires

Response rates 70% 80% 75%

Influential Metrics Unit of Metric Type SC1 SC2 SC3 SC4 SC5 SC6 SC7
measurement
in Parents production stage
input output Capacity: Capacity: Capacity: Capacity: Capacity: Capacity: Capacity:
161000 80000 210000 30000 173000 200000 17000

PLAN
Environmental Compliance Cost/ million RIALs
0.034 0.031 0.041 0.048 0.049 0.034 0.015
capacity

Return on Supply Chain Fixed Assets none
0.17 0.60 1.34 0.19 1.94 0.67 0.08

Return on Working Capital none
0.22 0.81 3.32 5.00 3.93 0.25 2.00

SOURCE

Source Cycle Time days
60 60 60 60 60 60 180

Cost to Source / capacity million I.R.I
0.14 0.29 0.15 0.17 0.26 0.23 0.26
Rials

Day old breeder chicks quality Likert
4 3 4 5 4 5 3

(Product Acquisition Costs )

Feed quality Likert
3 4 4 5 5 5 4

(Product Acquisition Costs )

MAKE
Make Cycle Time days
540 540 540 540 540 540 610

Cost to Make/ capacity million I.R.I
0.23 0.14 0.18 0.21 0.15 0.17 0.38
Rials

Perfect Order Fulfillment Likert
3 4 5 5 4 4 1

DELIVER
Cost to Deliver/ capacity RIALS
844 675 728 1000 3400 4600 5400
Table 3. Influential metrics in parents production stage, the type of them and their values

Upside Deliver Adaptability Likert
3 2 3 1 4 4 1

Cash-To-Cash Cycle Time days
10 11 10 9 12 7 15

Influential Metrics Unit of Metric Type SC1 SC2 SC3 SC4 SC5 SC6 SC7
measurement
in Broiler production stage
input output Capacity: Capacity: Capacity: Capacity: Capacity: Capacity: Capacity:
1430000 500000 150000 60000 150000 33000 20000

PLAN
Environmental Compliance Cost/ million RIALs
0.020 0.022 0.040 0.025 0.016 0.017 0.035
capacity

Return on Supply Chain Fixed none
0.52 0.46 1.44 0.37 0.26 0.22 0.39
Assets

Return on Working Capital none
16.53 3.50 14.32 0.41 0.29 0.85 0.07

SOURCE

Cost to Source / capacity million I.R.I
0.19 0.13 0.22 0.18 0.14 0.10 0.25
Rials

Day old broiler chicks quality Likert
3 5 4 5 4 4 3

(Product Acquisition Costs )

Feed quality Likert
2 4 4 5 5 3 2

(Product Acquisition Costs )

MAKE
Cost to Make/ capacity million I.R.I
0.21 0.18 0.26 0.20 0.17 0.18 0.19
Rials

Perfect Order Fulfillment Kg/ day
228 265 257 225 223 209 177
(production number)

DELIVER

Deliver Cycle Time days
2 2 2 9 4 3 5

Cash-To-Cash Cycle Time days 3 4 4 6 3 2 17

Table 4. Influential metrics in broiler production stage, the type of them and their values

Influential Metrics Unit of Metric Type SC1 SC2 SC3 SC4 SC5 SC6 SC7
measurement
in Processing Stage
input output Capacity: Capacity Capacity: Capacity Capacity Capacity Capacity:
4000 : 4000 4000 : 2000 : 4000 : 4000 2000

PLAN

Environmental Compliance Cost/ million I.R.I
2.32 2.12 1.98 2.57 4.50 4.50 3.41
capacity Rials

Return on Supply Chain Fixed none
1.52 0.82 0.85 0.14 0.15 0.15 0.01
Assets

Return on Working Capital none
3.87 3.90 2.85 1.45 1.72 1.72 0.72

Integrated process

Total costs million I.R.I
4.65 3.04 3.15 5.15 9.00 9.00 4.60
Rials

Cash-To-Cash Cycle Time days
1 1 2 4 3 3 9

Table 5. Influential metrics in processing stage, the type of them and their values
 Table 6. The weight of processes

Process type

Business stage Plan Source Make Deliver

Parents production 0.22 0.385 0.25 0.197
Broiler production 0.262 0.364 0.196 0.178
Processing 0.456 0.12 0.162 0.27

Table 7. The ranks of SCs

SC Score Rank Score Rank Score Rank
(V-shape) (V-shape) (U-shape) (U-shape) (Level) (Level)
SC1 0.11 4 0.11 4 0.14 4
SC2 0.67 1 0.67 1 0.67 1
SC3 0.33 2 0.33 2 0.36 2
SC4 -0.09 5 0.00 5 0.00 5
SC5 0.26 3 0.17 3 0.17 3
SC6 -0.28 6 -0.28 6 -0.33 6
SC7 -1.00 7 -1.00 7 -1.00 7