S&OP

Manufacturers in the Consumer Packages Goods Sector were the early adopters of Supply Chain Forecasting. Catering to the firm demands of the Retail Partners, CPG manufacturers focused on minimizing the forecast error and making better forecasting the major driver of fill rates and lower inventory carrying costs.

Most CPG supply chains have an active Sales and Operations Planning Process, which is cross-functional with participation from Sales, Marketing, Logistics, Supply Planning, Finance, Sales Planning and Demand Planning functions. Typically, there is a one-number philosophy although the more practical processes advocate tolerances between forecasts with different objectives.

Sales and Operations Planning Process thrives on collaboration and honest communication between key organizational players.  Our process design approach is driven by the understanding of key touch points in the organization and how effective demand and supply communication among these touch points can be improved.  This is a unique process embodying several information sharing sessions and decision forums, with the final intent to generate an organizational Plan and key Sales and Operations issues for the top organizational  manager to decide on.  

1. Assess the key objectives of the Planning Process  Identify and Involve stakeholders in Sales, Supply Planning, Operations, Marketing, and Finance during the process definition phase.  Interview key General Managers and understand their informational needs from the Sales and Operations Planning process. 

2. Identify the key pain points    

3. Identify the Key Component Meetings      

4. Design Content and Timing of Meetings     

5. Meeting Templates  We will help you design appropriate templates and summary reports to facilitate the meetings to be focused on key issues and arrive at a consensus recommendation.  Demandplanning.net has designed various templates and has a vast collection of process reports in its knowledgebase.  We will help you design a template that is customized to the process needs.

6. Supply Collaboration Process    

7. Budget Shortfall Review  Depending on the pain points of the current organizational process, Demandplanning.net can design this meeting to reconcile top-down market share forecasts with the operational demand plan.  The GAP identification and resolution is a major part of the Sales and Operations Planning Process. 

8. Exception Management   

9. Sales, Operations and Inventory Planning  This is a key part of the Operations Planning and review.  The organizational consensus team will examine the Sales, Production and Inventory Plans and discuss major issues and bottlenecks in the process.  

10. Supply constraints and Scenario Management

11. Value Chain Metrics  The Sales and Operations Planning process will be guided by the various value chain metrics that highlight performance and pin point areas of improvement.  The Metrics should be a good indicator of the state of the business and should call for quantifiable corrective action.  The design of the metrics should help you align incentives holistically to help achieve the organizational objectives.  The key metrics include customer service (FTFR), inventory targets, forecast accuracy, on-time delivery, order cycle times.  Demandplanning.net will help you design metrics customized to how various functional players are aligned in your organization.  With our research and analytics in this area, we have a unique advantage in designing proper Supply Chain Metrics and implementation.

If you would like to find out more details on facilitating or developing an S&OP planning process, please contact us.