Organizations are facing more complex supply chains than ever before, caused by increasing economic growth in emerging economies and other global factors like COVID-19. Silos are typical in most organizations due to varying department goals and processes. Increasing customer demand volatility magnifies the issues with poor visibility into sourcing, inventory, warehousing, optimized orders, and more.
Sales and operations planning helps executives make more informed decisions based on multiple information sources across different departments. While most employees tend to be focused only on their own tasks, executives need to understand every portion to gain a high-level perspective. When it comes to supply chain management, S&OP is how executives get the information to make the decisions they need to achieve excellence.
Sales and Operations Planning, commonly referred to as S&OP, is a key business activity where leadership and executive teams meet monthly to ensure each business function aligns to balance the supply and demand. S&OP requires cross-organizational collaboration to create detailed forecasts for predicted sales.
The S&OP process includes forecasting, demand and supply planning, and executive review. It integrates sales and marketing strategies with supply chain considerations, allowing for a more unified mission across multiple departments or businesses.
So how can your organization improve sales and operations planning?
Steps of the S&OP Process
- Product Review: Analyze the market viability of current products and existing pipelines to decide product planning.
- Demand Review: Forecast demand to see future product needs for the business. Use historical data and future modeling to forecast how demand could look.
- Supply Review: Aim to connect with the demand plan while also reducing inventory and customer service costs.
- Preparation: Get the departments’ leaders together to identify the gaps and disconnections and create strategic approaches to fixing them.
- Execution: Take the plans created in the previous steps, sync them together, and assess various possible scenarios.
How to Choose S&OP Software
S&OP software complements an ERP solution that aligns the sales and operations teams and connects supply with demand.
The success of an S&OP initiative hinges on the strength of the supply chain planning software. To choose S&OP software, first, consider the requirements. You will need software to integrate all aspects of your supply chain and your sales and marketing efforts to create the necessary forecasts.
Second, the software must be able to evolve with your organization. Having software that can scale with the organization and grow with changes in the supply chain is vital.
Third, it needs to be readily usable by a regular user without too much assistance from support!
With Vanguard Predictive Planning™ for S&OP, organizations build their S&OP process on a state-of-the-art platform that instills collaborative planning across all business lines. Vanguard Predictive Planning™ enables decision-makers to collaborate easily and reach consensus on a single operating platform that encompasses the needs of your entire enterprise. Through Vanguard, organizations gain a comprehensive view of supply and demand that aligns strategic business plans with operational capabilities and constraints.
Sales and Operations Planning (S&OP) is a key aspect of supply chain management that integrates activates across the entire business. With the proper software, organizations can align operations and strategy, enabling collaboration among decision-makers and facilitating consensus on a single plan while gaining an organizational view of demand and supply.
To learn more about how Vanguard Software can help you achieve higher and more reliable revenue, improve margins, and increase profitability, contact us today.