The new normal is testing supply chain resiliency and organizations are forced to revisit their demand and supply operations and drive new revenue streams. Sales and Operations planning (S&OP) typically face time, people and monetary constraints. As the new unexpected global crisis tossed aside months of careful planning, business executives were forced to go back to the drawing board, re-planning using traditional tools and solutions. This highlights the glaring gap in S&OP planning as organizations increasingly look at making strategic and data backed decisions now and in the near future.
Sales success invariably depends on integrating the right sales behaviors with real-time planning and analytics to maximize returns. S&OP is the backbone for the entire organization, more so in times of crisis, and hence the process needs to build in inherent resiliency and be ready to respond in any situation. Here we look at a few simple tactics to create S&OP processes that stands the test of time.
To empower S&OP teams to make sophisticated planning decisions, and meet continuously changing business realities, the first step is to do away with the decision latency associated with multiple, disconnected supply chain planning systems. Incomplete S&OP processes are more often than not a result of disconnected sales/marketing, finance and other internal systems. A unified platform goes a long way in enhancing collaboration and aligning decisions across departments. An easy-to-use collaborative platform can not only improve service levels and plan accuracy through better customer and supplier collaboration, but also helps maximize market opportunity, profitability and customer satisfaction while reducing supply chain risks.
“The traditional monthly S&OP cycle will no longer cut it. Rapid re-planning and in-cycle adjustments will become the norm.” Mark Hermans, Managing Director at PwC, Aug 2020
The COVID-19 crisis has well exposed the vulnerabilities of traditional statistical models that cannot portray previously unknown demand patterns. To increase planning efficiency, it is a must to create capabilities that can take into account an entire ecosystem on-demand. There are tools in the market that has the ability to ingest up to multiple data inputs and greatly enhance the quality of the forecast. Inbuilt ML capabilities train forecast models to deliver more tailored outputs. This enables S&OP decision makers to acquire a better understanding of future drivers, predictions, and the impact of different “what-if” scenarios.
Many a time the inherent complexity of an S&OP platform dissuades users from leveraging the same to create meaningful reports. Thus, they are left hanging in the face of supply chain disruptions with no ability to anticipate the sudden demand changes. This highlights the need to adopt tools that simplifies the process, allows flexible modeling, and provides a better user interface. Such a tool doesn’t require any intervention from data scientists or ML experts for configuration, deployment or operation, empowering users to go the full length and unlock intelligent insights. Sales teams can also leverage the platform to easily convert customer data into a format that is forecast friendly thus avoiding tedious manual data preparation
Supply chain resilience is an outcome of an organization’s S&OP resilience. Transforming the S&OP process not only acts as an insurance against future disruptions but also enhances the daily planning activities. Infusing agility into S&OP improves collaboration among sales, product, innovation, finance, operations, and marketing units, increases productivity with improved processes, facilitates better understanding of the underlying risks and opportunities, and help teams make more informed predictions while expending fewer resources. With detailed P&L interactions, intuitive scenario planning, and near real-time supply-demand balancing at their disposal, such teams are a step forward when it comes to quickly and nimbly responding to supply chain emergencies.
Thanks to COVID to make us realize the reality of Supply Chain Disruptions and how we can work towards mitigating the Supply Chain Risk