By
Chaman L. Jain, Ph.D.
Tobin College of Business
St. John’s University
8000 Utopia Parkway
Jamaica, New York 11439
USA
J...
•  How S&OP works
•  What obstacles do we encounter, and how to
overcome them
•  Benefits of S&OP
Step	
  5	
  
Exec	
  S&OP	
  
(Review,	
  finalize	
  and	
  implement	
  plans)	
  
	
  
Source: 	
  Adapted	
  from	
  t...
1.  Align demand with supply
2.  Integrate operational plans with strategic
goals/budget
3.  Manage product portfolio
4.  ...
Obstacles to Implementation
•  Lack of support from upper management
•  Silo structure
•  Excuses and excuses for not atte...
Benefits of S&OP
•  Improves forecasts
•  Increases sales and reduces stock-outs and
inventory
•  Improves customer servic...
7
BENEFITS	
  DERIVED	
  FROM	
  THE	
  IMPLEMENTATION	
  OF	
  S&OP	
  PROCESS	
  
Company	
   Period	
  
Improvement	
  ...
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Bologna s&op-may -2014-rr

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Presentation of Dr. Jain, Professor at Saint John's University, about S&OP - IBF seminar of 20th may organized by Advance School in Italy

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Bologna s&op-may -2014-rr

  1. 1. By Chaman L. Jain, Ph.D. Tobin College of Business St. John’s University 8000 Utopia Parkway Jamaica, New York 11439 USA Jainc@stjohns.edu
  2. 2. •  How S&OP works •  What obstacles do we encounter, and how to overcome them •  Benefits of S&OP
  3. 3. Step  5   Exec  S&OP   (Review,  finalize  and  implement  plans)     Source:  Adapted  from  the  book,  Thomas  F.  Wallace.  Sales  &    Opera+ons        Planning:  The  How  to  Handbook.  CincinnaG,  Ohio:  T.  F.  Wallace  &          Co,  2004,  p.  59.                           Step  3   Supply  Planning  Group   (Ability  to  meet  the  demand;  if  not,  what  opGons  do  we  have)         Step  4   Pre-­‐Exec  S&OP   (Prepare  a  proposal  for  the  Exec-­‐S&OP)                           Step  1   Data  Gathering   (Gather  data,  and  prepare  staGsGcal  forecasts)                                   Step  2   Demand  Planning  Group   (Finalize  forecasts,  and  send  them  to  the  Supply  Planning  Group)         Working of Sales and Operations Planning Process                        
  4. 4. 1.  Align demand with supply 2.  Integrate operational plans with strategic goals/budget 3.  Manage product portfolio 4.  Integrate product mix with total volume/profit    
  5. 5. Obstacles to Implementation •  Lack of support from upper management •  Silo structure •  Excuses and excuses for not attending meeting •  No champion •  Concentrating on SKUs, not on category and brand •  Goals and metrics are not clearly defined •  Guidelines for resolving conflicts and courage to act on difficult issues •  No centralized data warehouse •  No technology to facilitate the process •  Conflicting incentives 5
  6. 6. Benefits of S&OP •  Improves forecasts •  Increases sales and reduces stock-outs and inventory •  Improves customer service •  Reduces cost of production •  Reduces obsolescence •  Reduces freight cost •  Enables to make decisions faster and with less efforts •  Creates harmony among different functions 6
  7. 7. 7 BENEFITS  DERIVED  FROM  THE  IMPLEMENTATION  OF  S&OP  PROCESS   Company   Period   Improvement  in   Forecasts   Improvement  in   Inventory   Improvement  in   Customer   Service   Source   Air  Products  &  Chemical           JohnsonDiversey         Syngenta           On  Semiconductor     2003-­‐06           2002-­‐05         2001-­‐06         2004-­‐05   21%           23%         49%         NA   20%           18%         5-­‐10%         14%   10%           6%         NA         1%   Stephen  P.  Crane,   Dir.  of  Supply  Chain   Performance   Polymers       Greg  Reyman,   Director  GAPAC   Value  Chain     Richard  Herrin,       Currently,  Director   of  Supply  Chain,   Georgia  Gulf   Corporation       Tim  Williams,   Demand  Forecasting   Mgr.     1. Herrin,  Richard.  “Managing  Products  via  Demand  Variability  and  Business  Importance.”  Journal  of  Business  Forecasting.  Spring  2007,  pp.  6-­‐10.     2. Reyman,  Greg.  “How  JohnsonDiversey  Implemented  S&OP  in  Europe.”  Journal  of  Business  Forecasting.  Fall  2005,  pp.  20-­‐23,  28.   3. Williams,  Tim.  “Forecasting  Journey  at  On  Semiconductor.”    Journal  of  Business  Forecasting.  Spring  2006,  pp.  29-­‐32.     4. Crane,  Stephen  P.,  “How  to  Incorporate  Market  Intelligence  into  Statistical  Forecasting,”  Presentation  at  the  Demand  Planning  &  Forecasting  Best  Practices  Conference  in      Orlando,   Florida,  of  Institute  of  Business  Forecasting  and  Planning,  Appeared  in  the  Conference  Manual  (New  York:  Institute  of  Business  Forecasting  and  Planning,  October  2006):  327-­‐347.  
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