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To run the S&OP process efficiently and effectively, you need the support of the top management, without which nothing will work ... schedule S&OP meetings at least 12 months into the future so that team members can plan ahead ... the best way to start an S&OP process is to start with a pilot program with one or two product groups.
Sales & Operations Planning (S&OP) is the process by which we bring together all the plans for the business (Customers, Sales, Marketing, Development, Manufacturing, Sourcing, and Financial) into one integrated set of tactical plans. The S&OP process provides management the ability to direct its business to achieve a sustainable competitive advantage. The overall objective of S&OP is to arrive at a business "Game Plan" to help manage and allocate critical resources to meet the needs of a customer at the least cost. Figure 1 shows the five steps in the S&OP process.
Implementation of the S&OP process is a journey that should be undertaken in phases. The first phase involves getting the basics in place. (See Figure 2) Failure to properly build the S&OP foundation will impede progress in the business and result in lower benefits. In some instances, the S&OP approach may fail completely if the fundamentals are not properly implemented.
BASIC STEPS IN S&OP IMPLEMENTATION
The following tasks must be completed before conducting the first S&OP meeting.
1. Educate top management and acquire a champion for the implementation.
2. Determine the S&OP Team members marnes and positions).
3. Set dates for the next 12 S&OP meetings and process steps.
4. Identify planning groups, planning horizon, and resources available.
5. Design and test S &OP data acquiring, data processing, and displaying of tables.
6. Develop S&OP level performance measures and implement the reporting procedure.
7. Develop and issue S&OP meeting agenda and conduct first meeting.
These tasks usually require three to six months. While you need a project plan, try not to exaggerate the effort required, as that would make it more difficult to acquire upper management support. In terms of time and money, a typical S&OP implementation is not very expensive relative to the benefits received. The participants in the implementation are primarily the process stakeholders who will greatly benefit from...