What Great Sales & Operations Planning (S&OP) Feels Like!

EXECUTIVE S&OP by Tom Wallace WWW.TFWALLACE.COM

Tom Wallace/Agility Series Webinar September 17, 2013

What Great S&OP Feels Like


What Great S&OP Feels Like

Two Ways to Measure:

• Quantitative

- Checklists

- Maturity Stages

• Qualitative- How Does It Feel?


1. A Visible Increase in Teamwork

Successful S&OP = Better Teamwork

• When Teamwork does not improve,

S&OP wasn’t implemented properly

• Improved Teamwork is a given, if . . .

you do it right.

“This process enables my staff (the vice

presidents) to view the business through

my glasses.” Division President


Check Up

Question: has teamwork in your

company visibly improved from

before S&OP?


2. Demand and Supply

Normally in Balance

This is S&OP’s most fundamental task.

If it can’t do this, you can forget about the rest

“Tom, I used to spend most of my day out on

the plant floor expediting and putting out

fires. Now, I have to remind myself to get out

of my office and make an appearance in the

plant.” Plant Manager


Check Up and Poll Question

Question: has “fire fighting”

decreased from before S&OP??”

A. We do very little fire fighting anymore

B. It’s about the same as before S&OP

C. It’s worse than before S&OP


3. Communications

Clearer and More Certain

“We need better communications

around here.”

The Executive S&OP process is

“communication rich” and “collaboration driven”

• open and complete communications

• cross-functional collaboration

for resolution of issues and problems

http://www.steelwedge.com/solutions/executive-sales-and-operations-planning/


Check Up

Question: are fewer things “falling

through the cracks?”


4. Fewer Surprises -

Resolved Quickly

“Window Into The Future”

• Keep potential problems from

becoming real problems

• Resolve real problems quickly

“With S&OP and one set of numbers,

we can now resolve problems in less

time than we needed to decide whose

numbers to use.” VP Product Supply



Question: when “surprises” occur, such as

demand spikes or supply crashes, does

your S&OP process allow for mid-period

adjustments to be made quickly?

A. Yes, we are much more agile than before

B. We’ve improved but need to do better

C. No change from before S&OP


5. Eighteen Months or More

Forward Visibility

Q. Why 18 months?

A. 18 months “wraps around” the fiscal year

Example:

• Fiscal Year Ends 12/31

• Start working on next year’s plan in

August of the current year

• 18 months covers all of next Fiscal Year

• Demand Plans, Supply Plans, Finished

Goods Inv Plans + Others already exist


Check Up

Question: does your annual financial

planning process use demand plans

and supply plans from Executive S&OP

or does all of the data it uses come from

other sources?


6. One Set of Numbers Internally

Multiple Display Formats/Multiple Units of Measure

- Sales

- Marketing

- Finance

- Operations

- Supply Chain . . .

. . . all coming from one set of data

Underpromise & Overdeliver

S&OP doesn’t care what you tell Wall Street

or Corporate. Tom Wallace



Question: is everyone singing off the same

sheet of music . . . or not?

A. Absolutely. We run with 1 set of numbers

B. Some departments are still not on board

C. It’s the same as before S&OP


7. Top Management engaged

and enthusiastic

“Tom, when I think back to last year, before

we had S&OP, I can’t imagine how we

were able to run this business.” CEO

Attendance at monthly Exec S&OP Meeting?

- Good News

- Bad News



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?

A. Absolutely.

B. It’s spotty.

C. It’s the same as before S&OP


8. Executive S&OP helping to

achieve strategic goals From S&OP: Beyond The Basics:

1. BASF – Strategic Goal: become #1 in the world

“While BASF does many things well, S&OP has

contributed significantly to helping us achieve

our present #1 position in the industry.”

Business Process Education Manager



achieve strategic goals – cont’d

2. Cisco Systems – Strategic Goal: create a new

business far different from its traditional

products

“We at Cisco consider the Telepresence story a

great example of how S&OP can make major

contributions to the company’s strategy. Being an

early mover into a new market requires a different

approach than when we take on more mature

markets, regardless of our market position.”

Director, Sales & Operations Planning



achieve strategic goals – cont’d

3. Dow Chemical – Strategic Goal: integrate

the Rohm and Haas acquisition into Dow

Implementation of Executive S&OP within

our combined businesses played a

significant role in helping to integrate the

two companies. This was a driving force for

enabling cost and growth synergies.”

VP Supply Chain


Check Up

Question: is your company’s use of

S&OP confined to balancing demand

and supply, integrating financial and

operational plans – the basics – or is it

also being used in a major way to

support strategic initiatives?


Recap –

What Great S&OP Feels Like 1. A Visible Increase in Teamwork

2. Demand and Supply Normally in Balance

3. Communications: Clearer and More Certain

4. Fewer Surprises - Resolved Quickly

5. Eighteen Months or More Forward Visibility

6. One Set of Numbers Internally

7. Top Management Engaged and Enthusiastic

8. Executive S&OP Helping to Achieve Strategic Goals


News Flash #1

New on LinkedIn:

Tom Wallace’s S&OP/Q&A Group

Mission: for people working with S&OP, to help them get

clear, easy to understand answers to their questions

Fair Warning: I don’t have all the answers. Sometimes

I may be asking you for answers

So don’t be bashful; asking questions is easy

and quite painless


News Flash #2

My latest book: Sales & Operations Planning: Beyond

the Basics, is available to participants in this webinar for

a 25% discount.

To order, go to www.tfwallace.com. In the Bookstore, as

you purchase the book, use discount code

STEELWEDGE 9-17.

That will get you the friendly price for that book

plus other items.

http://www.tfwallace.com

24 © 2013 Steelwedge Software, Inc. Confidential.

Nari Viswanathan/Agility Webinar September 17,2013

Technology: Making S&OP Feel Even Better


• How Does Technology Help S&OP Feel Better?

• Gets Everyone on the Same Page

• Collaborative planning: aggregates team, data

• Gets Supply, Demand and Finance in Balance

• From Fire Fighting to Integrated Reconciliation

Agenda


Demand Collaboration: Everyone on the Same Page

Marketing Forecast

Account Forecast

Sales Manager Forecast

Demand Forecast

Inputs

Forecast,

NPI & EOL,

Product

Volume

Sales, Orders,

Opportunities,

Budget &

Master Data

Account Level

Forecast

Sales Region

Forecast

Demand

Review and

Geo Forecast

Consensus

Forecast

Planning Processes

Nightly

Transaction

Files

Demand

Analyst

Marketing

Account

Management

Sales

Management

Demand

Planning

Consensus

Team

Compass Inputs

and Outputs

Consensus Forecast

Insight

S&OP Apps

Customer Collaboration

NPI/EOL Modeling

Promotion Modeling

Historical Demand Analysis

Statistical BOM

Inverse SBOM

Supersession

S&OP Sales

S&OP Ops

Executive S&OP

Collaboration

Performance

Current Plan

Finance

Waterfall

KPI Dashboard

Collaboration

• Demand Collaboration

• Classic example of multi-

functional collaborative

process

• Critical to engage Sales

and Marketing

• Majority of S&OP

implementations fail due

to lack of sales or

management executive

participation

2.10 Marketing_3848_Marketing_Multi.xlsx

2.40 Acct Mgr XP Max Str_276_Account_Manager_Single.xlsx

2.80 Laptops Geo_2337_Demand_Planner_Multi.xlsx

Performance_Report_2011-01-23_13-07-15.xlsx

Current Plan Report.xlsx

../../../../../Opportunities/Opportunity Presentations/Demo Decks/Steelwedge - CE9StdDemo 20121001/Dashboard.xls

Collaboration Insight Report.xlsx


Modeler

Update the marketing forecast in

units and revenue

Add Macro Economic Data

to influence the forecast

Product View for all

customers Add Market Size to determine the

market share percentage

Outlook Metrics

• VP of Marketing

• Key participant missing

in many S&OP

Processes


Products by Customer

Rapid entry of Update

Unit and ASP Forecast

• Sales Personnel

• 1000’s of users

• Remote regions

• Have inhibition using

supply chain tools


Performance report

Sales Sales analysis

• Metrics drive behavior

• Key to be flexible and

agile in terms of metrics

• Cross-functional as well

as functional metrics are

required




• Gets Supply, Demand and Finance in Balance:

Scenario Modeling for Tradeoff Visibility

• From Fire Fighting to Integrated Reconciliation

Agenda


2.90 Consensus plan

• Finance Plan is a

key input to S&OP

as well as output


Agenda



• Gets Supply, Demand and Finance in Balance

• From Fire Fighting to Integrated Reconciliation:

• Real Time Exception Handling


Exception Handling: Sales Beyond the S&OP Cycle

VP of Sales

• Gets Real-time

Updates on Sales

Performance

• Can Trigger ad-hoc

S&OP Cycles


Exception Handling: Supply Beyond the S&OP Cycle

• VP of Supply

• Integrated Scenario

Management

• Drives Reconciliation

and Tradeoffs


ROI of Steelwedge S&OP Solution

• Average savings $5-$10M

per $1B in revenue

• Better scale

• Master data

management

• Collaborative planning

• Scenario modeling

• Single view of your

business

What Great Sales & Operations Planning (S&OP) Feels Like!

Technology

Transcript of What Great Sales & Operations Planning (S&OP) Feels Like!