Navigating the Journey to Streamlined S&OP: Initiative, Tools, and the Value of Decision Support

Since the term S&OP was first coined in the 1980s, sales and operation planning has become an important mission for companies striving to align forecasting, production, inventory management, and other organizational functions for optimal results.

While S&OP sounds straightforward in theory (after all, how difficult can it be to get all departments on the same page and working toward the same goals?), a properly implemented strategy is anything but easy to attain.  In his work with manufacturers, Aberdeen Group vice president and principal analyst Bryan Ball emphasizes the importance of solid, streamlined S&OP for companies of all sizes and across all industries.

Singling out best-in-class companies that have streamlined their S&OP processes, Ball says Aberdeen's research shows that such firms have nearly a 10 percent improvement in customer service rates and a 38-day cash-to-cash cycle advantage over all other businesses. The problem, says Ball, is that S&OP cannot be completed effectively without reliable, accurate information gathered from across the organization.

"The S&OP team must have up-to-date information regarding future time-phased demand, production capabilities, inventory status, and any limitations on resource availability to realize these best-in-class benefits," says Ball.

Getting there requires more emphasis on management support and belief in S&OP, says Ball in an interview with MSDynamicsWorld, and less focus on the related processes. Those processes typically revolve around bringing information from disparate systems into view on a single map - something that can't be done until all managers and decision makers are on board with the unified S&OP vision.

Leveraging Microsoft Dynamics ERP ...