The S&OP/IBP journey
The journey towards S&OP excellence starts by realizing that outstanding results do not appear overnight: they require time and persistence. At the start of the journey there are several potential obstacles including limited technology enablers, lack of governance, rigid functional silos, lack of shared performance measures, and more. Every company goes through this process.
We determine your maturity based on the 5 phases by Gartner
Stage 1: React
Imbalances in demand and supply lead to reactive mode of working resulting in short term focus and very likely higher costs, imbalances in inventory and missed sales. Meetings tend to focus on sales review.
Stage 2: Anticipate
Recognition to balance demand and supply by supply chain organisation to improve business performance. Formal structures established to manage demand and supply. Key performance metrics on customer service, inventory are implemented.
Stage 3: Integrate
Stage 4: Collaborate
Focus on profitability emerges in the meetings – particularly the financial impact of any decisions. A number of scenarios are developed and one is recommended to optimise the business plans to the leadership team. The S&OP process is now truly integrated business planning process.
Stage 5: Orchestrate
Business ownership at multiple levels with strong participation from executives and finance. Collaboration extends to include customers and suppliers. Process becomes balanced, dynamic and event driven. Tools support risk-value trade-offs and price optimization.