The Sales & Operations Planning (S&OP) Journey Continues at IBF

IBF's S&OP Workshop

IBF's S&OP Workshop

Last week, I attended IBF’s Executive S&OP workshop with Tom Wallace and companies such as LG, Celegene, Integra Life Sciences, UGG Boots, and more.   Some folks flew in to New Jersey from beautiful Southern California just for the S&OP education.  Bless them for coming to the North East.  If that doesn’t show dedication to the field, I think it certainly comes close.

I am often amazed how demand planning, forecasting, and S&OP always initiate great discussion.  This program was no different.  We’ve been covering S&OP for some time and I truly enjoy when a program provides nuggets of new thought to take back.

Here are some thoughts, questions, and/ or takeaways from the workshop:

1) There is still confusion between what is demand planning software and S&OP software.  Of course, any S&OP software does need input from demand planning & forecasting.  But, is it ok to call a demand planning application a S&OP application?

2) Some companies call the S&OP meeting the compromise meeting.  This certainly resonates well with me when I think of shopping with my wife on a budget :).

3) What are the steps that need to be taken during and after a company acquisition?  Tom says, S&OP should be leading the discussions prior to acquisition.

4) How do you change behaviors and thinking when a company has been extremely successful with double digit growth? How can we be proactive during this time to ensure we have a process in place to handle anything which might arise in the future?

5) Is one number planning truly one number or one set of numbers that drives planning?

6) There are many companies that have successfully implemented a S&OP process without a  consultant. This, of course, depends on the knowledge of the person driving the new process.  If completely new, it may be in the best interest of a company to hire an S&OP consultant to save time and resources in order to reach the benefits of the process much faster.

7) Tom always says the S&OP process is balancing Supply with Demand, not the other way around. However, for example, Ugg shoes uses supply to drive demand?!  I will talk more about this in a later post.

If you have any further thoughts on the above, or have an answer to these questions, we would love to hear from you.

Thanks for listening.

Anish Jain
Managing Director
Institute of Business Forecasting & Planning – IBF

One Response to The Sales & Operations Planning (S&OP) Journey Continues at IBF

  1. I have a problem with forecasting and Oliver Wight’s an many other MRP, ERP etc. professionals that promote demand management as the solution. (S&OP is OK – it is after all a place where different functions come together to talk strategy and tactics in the reasonably near future.

    Business spends many millions on forecasting software and what are they getting for it?

    Don’t forecasts tend to confuse what is already on hand in terms of information?

    Take inventory – the inventory on hand represents the maximum you expect to sell until the next replenishment comes in. So, its a forecast of the reasonable maximum sales until the next delivery. Correct? So why not use it as the forecast rather than confusing the issue with a forecast based on history.

    Good forecasts are some number PLUS a range around that number. The downside number is irrelevant and the upside number is the equivalent of your inventory. (Your target inventory is the amount you expect to sell between replenishments – the maximum amount. Inventory takes into account that a forecast is uncertain – something many managers do not. Managers are in love with deterministic numbers; but the World is chaotic!).

    Think about it – the idea should work whether you are in distribution or purchasing. What I have not talked about is communication, and the strategy to set something up based on the idea.

    If you are interested you can sign up for the following webinar … it is about consumer goods distribution, but most of what is in that webinar applies to any “MFA” environment. MFA = Make For Availability and implies a commitment to clients that when they need an article it will always be available.

    You can register here: https://www2.gotomeeting.com/register/431386690

    I will be presenting! Hope nobody minds the bit of self advertising!!

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