3. What is SALES AND OPERATIONS
PLANNING (S&OP) ?
€ is an integrated business
management process through which the
executive/leadership team continually
achieves focus, alignment and
synchronization among all functions of
the organization. The S&OP plan includes
an updated sales plan, production plan,
inventory plan, customer lead time
(backlog) plan, new product development
plan, strategic initiative plan and
resulting financial plan.
4. € is a powerful decision
making tool for business
executives as well as
line managers.
5. S&OPâs role is to
balance supply and demand
at the volume level.
Companies who do a
good job at this level find
much less problem at
balancing the supply and
demand at mix level.
6. S&OP is effective because it
develops a well coordinated operating
plan in support of your customer
demand, your business plan and your
strategy. It gives a complete picture
of forecasted demand, supply capacity
and corresponding ïŹnancial
information.
7. € S&OP is the result of
monthly planning activities.
€ It is usually based on an
Annual Operations Plan (AOP)
that acts as the company's
annual target in terms of sales
and supply.
8.
9.
10. € Enhanced Teamwork
€ Embedded Communications
€ Better Decisions And Better
Financial Plans
€ More Focused Accountability
And Greater Control
€ A window Into The Future
11. To assess the value of S&OP for your
company, consider these typical problems that
are addressed by the S&OP process:
€ Organizational structures where are each
department or business unit operates and
plans for inputs independently of one
another, often out of alignment with the
corporate strategy.
€ Financial plans are inaccurate resulting in
high variances between budget and actual
results.
€ New products regularly miss their launch
dates.
12. IMPLEMENTATION OF S&OP
€ highly focused on top
management, âImplementation
begins and ends with the Leader
(president, CEO, general manager)
of the businessâ.
€ if theyâve implemented S&OP
and teamwork hasnât visibly
improved, they didnât implemented
it well.
13. EXECUTIVE S&OP:
€ It is an executive decision-
making process.
€ Balances demand and supply.
€ Ties operational plans to financial
plans.
€ Is the forum for setting relevant
strategy and policy.
€ Is what we called, for years,
SALES AND OPERATIONS PLANNING