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    S&OP: What Great S&OP Feels Like

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    Cyrus Nyori
    This document outlines 8 qualitative signs that an organization's Sales and Operations Planning (S&OP) process is working well: 1) Visible increase in teamwork across functions, 2) Clearer and more certain communications, 3) Demand and supply are normally balanced, 4) There is one agreed upon set of numbers used internally, 5) Fewer surprises that are resolved quickly, 6) Forward visibility of 18 months or more, 7) Top management is engaged and enthusiastic in the S&OP process, 8) S&OP is helping the organization achieve strategic goals. It provides questions for each sign to help evaluate if an organization's S&OP demonstrates that quality.

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    S&OP: What Great S&OP Feels Like

    Uploaded by

    Cyrus Nyori
    12 views3 pages
    This document outlines 8 qualitative signs that an organization's Sales and Operations Planning (S&OP) process is working well: 1) Visible increase in teamwork across functions, 2) Clearer and more certain communications, 3) Demand and supply are normally balanced, 4) There is one agreed upon set of numbers used internally, 5) Fewer surprises that are resolved quickly, 6) Forward visibility of 18 months or more, 7) Top management is engaged and enthusiastic in the S&OP process, 8) S&OP is helping the organization achieve strategic goals. It provides questions for each sign to help evaluate if an organization's S&OP demonstrates that quality.

    Original Description:

    What great S&OP looks like

    Original Title

    Great S&OP

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    This document outlines 8 qualitative signs that an organization's Sales and Operations Planning (S&OP) process is working well: 1) Visible increase in teamwork across functions, 2) Clearer and more certain communications, 3) Demand and supply are normally balanced, 4) There is one agreed upon set of numbers used internally, 5) Fewer surprises that are resolved quickly, 6) Forward visibility of 18 months or more, 7) Top management is engaged and enthusiastic in the S&OP process, 8) S&OP is helping the organization achieve strategic goals. It provides questions for each sign to help evaluate if an organization's S&OP demonstrates that quality.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    12 views3 pages

    S&OP: What Great S&OP Feels Like

    Uploaded by

    Cyrus Nyori
    This document outlines 8 qualitative signs that an organization's Sales and Operations Planning (S&OP) process is working well: 1) Visible increase in teamwork across functions, 2) Clearer and more certain communications, 3) Demand and supply are normally balanced, 4) There is one agreed upon set of numbers used internally, 5) Fewer surprises that are resolved quickly, 6) Forward visibility of 18 months or more, 7) Top management is engaged and enthusiastic in the S&OP process, 8) S&OP is helping the organization achieve strategic goals. It provides questions for each sign to help evaluate if an organization's S&OP demonstrates that quality.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    S&OP: What Great S&OP Feels Like

    Often individuals raise questions about how S&OP is performing in their company.
    They ask: how can I know if its really working well?

    There are two answers to this question, one qualitative and the other quantitative.
    The latter is in the form of checklists: Here, however, Id like to focus on the
    qualitative aspects of answering the question: is it working well.

    1. A visible increase in teamwork.


    When you implement Executive S&OP successfully, your teamwork will improve; its
    virtually a sure thing. This is because you get away from the confusion and suboptimal performance thats part and parcel of the silo mentality. Even for companies
    not doing the silo thing, teamwork will improve.

    Question: has teamwork in your company visibly improved from what it was prior to
    implementing S&OP?

    2. Communications clearer and more certain.


    You may have heard the complaint: we need better communications around here.
    The odds are that the person did not mean faster fax machines or enhanced e-mail,
    but rather how effectively people share information. The Executive S&OP process is
    communication rich and collaboration driven. It requires open and complete
    communications on important issues and also requires cross-functional collaboration
    for their resolution.

    Question: are fewer things falling through the cracks?

    3. Demand and Supply normally in balance.


    The most fundamental task for Executive S&OP is to help create the demand/supply
    balance. This is how S&OP got started, helping people balance demand and supply
    and to maintain that balance as the company moves forward through time. Getting
    demand and supply in balance is essential for the rest of the important elements
    within S&OP to work well.

    Crisis management putting out fires is no longer a way of life.


    Question: has fire fighting visibly decreased from before S&OP?

    4. One set of numbers internally.


    In many companies, multiple sets of numbers abound: Sales and Marketing has
    their set of plans, Operations has theirs, and Finance has a third. And guess what?
    hardly ever do those different sets of numbers agree;. With effective Executive
    S&OP, there is one and only one set of numbers serving these different groups,
    expressed in different units of measure.

    Many companies take the position: Under Promise but Over Deliver. Thats fine;
    S&OP doesnt care ... What is required is to use only one set of numbers internally
    within the business. And companies that do so will tell you its a nice way to live.

    Question: is everyone singing off the same sheet of music, or are there still some
    separate sets of plans remaining, perhaps from the old days.

    5. Fewer surprises, resolved quickly.


    Executive S&OP provides a window into the future. Its uncanny; with S&OP
    working well, people can see into the future; it enables people to see potential
    problems and to resolve them before they move into the near term and become real
    problems.

    Does this always happen? Of course not; please note the first word above fewer.
    When a surprise does occur, it can often be resolved quickly thanks in part to the
    one set of numbers covered earlier.

    Question: does your S&OP process allow for mid-period adjustments when
    surprises occur, such as demand spikes or supply crashes, and to make those
    mid-period adjustments quickly?

    6. Eighteen months or more forward visibility.


    Why 18 months? Why not 12 or 15 months? Because a planning horizon of 18 or
    more months best supports the creation of next years Annual Financial Plan. Take
    the case of a company with a January to December fiscal year: work typically begins
    on next years plan in August or September.

    At that point, an 18-month S&OP horizon covers all of next year, January through
    December. The demand forecast, the supply plans, finished goods inventory
    projections and other plans already exist, and theyve been worked every month for
    quite some time. This makes the creation of next years Annual Plan much easier
    and much less hassle.

    Question: does your annual planning process depend on demand plans and supply
    plans from Executive S&OP or does all of the data it uses come from other sources?

    7. Top Management engaged and enthusiastic.


    This means youll no longer have to worry about attendance at the monthly
    Executive Meeting; the execs will be there because theyre deeply involved in the
    Executive S&OP process. They know it helps them to run the business better.
    Question: does your executive team, up to and including the leader of the business,
    participate hands-on in the Exec S&OP meeting each month?

    8. Executive S&OP helping to achieve strategic goals.


    S&OP does not create strategy, but rather it helps companies to reach strategic
    goals. One example is the launch of major new products;

    Question: is your companys use of S&OP confined to the traditional processes of


    balancing demand and supply, integrating financial and operational plans, and so
    forth or is it also being used to support strategic initiatives?

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