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.