Leveraging Supply Chain Productivity with Dynamic S&OP


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Dynamic S&OP is a combination of processes, technologies and data mining.

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  • S&OP serves 2 purposes:Provides the link between the strategic and business plans through the detailed planning and execution systems in the company.Provides a regulator for all the other plans, including the setting of Master Plan Schedule or Global Supply Plan, Inventory investment and commitment of resources.S&OP serves only one goal and one company plan
  • S&OP is an “umbrella’ process that links several distinct processes:Forecast generationDemand PlanningSupply PlanningFinancial PlanningIt is more than just the Sales and Production Plan: it is part of the overall company business process, including Marketing, Warehousing and Distribution, Finance as well as Production, Supply and Procurement Planning.The S&OP cycle wheelThe monthly cycle starts with previous month realization analysis, and re-forecast of the future month, for the sales, the supply and the inventory position. S&OP process owners in their respective scope of work and responsibility must first work in parallel to allow later reconciliation
  • The forecasting wheelSales forecasting is a management process, not a computer programThis distinction is important because it affects so many areas across an organization
  • NMC has collected POS mass data from all outlets. However, these valuable data were left not analyzed. The first step of the process is to perform a data mining process that comprises:Analyzing regional, category, sub category differences and behaviors Identifying correlation, patterns, trendsAnalyzing purchase behaviorsThus help to make strategic decisions
  • Discover meaningful new correlations, patterns and trends using large amount of data and integrate their results or their related decisions through the S&OP processProducts and regions sometimes managed by different departments
  • Leveraging Supply Chain Productivity with Dynamic S&OP

    1. 1. Leveraging Supply Chain Productivity with Dynamic S&OP<br />Prof. John Paul<br />Managing Director<br />iCognitive<br />Manufacturing Supply Chain Officer Summit 2011 - Shanghai<br />
    2. 2. Agenda<br />Why Dynamic S&OP?<br />Benefits of Dynamic S&OP<br />Dynamic S&OP for Manufacturing<br />2<br />
    3. 3. Why Dynamic S&OP? <br />3<br />
    4. 4. Why dynamic S&OP?Dynamic S&OP – The response to several business challenges<br />Volatile business environment calls for more excellent operational efficiency and effectiveness.<br />Internal collaboration is often not sufficient to face today’s highly competitive market place.<br />Companies’ data containing valuable information are often not analyzed. Companies able to identify these information have firsthand opportunities.<br />4<br />
    5. 5. Why dynamic S&OP?Sub-optimized inventory management results in reduced profitability<br /><ul><li>Poor supplier fill rate
    6. 6. Stock-outs
    7. 7. Stock obsolescence
    8. 8. Excess inventory</li></ul>5<br />Loss of Sales<br />High Working Capital<br />
    9. 9. Implementing Dynamic S&OP <br />6<br />
    10. 10. Implementing dynamic S&OPDynamic S&OP - A combination of processes, technologies and data<br />7<br />
    11. 11. Forecast Generation<br />Implementing dynamic S&OP Forecast - Projecting achievable sales revenue<br />8<br />
    12. 12. Implementing dynamic S&OP<br />Dynamic S&OP - A combination of processes, technologies and data<br />9<br />
    13. 13. Implementing dynamic S&OPS&OP - One Goal, One Plan, One Company<br />10<br />
    14. 14. Implementing dynamic S&OP S&OP - A Succession of interlinked processes<br />11<br />
    15. 15. Implementing dynamic S&OP S&OP - A Wheel inside the Wheel<br />12<br />
    16. 16. 13<br />Implementing dynamic S&OP<br />Dynamic S&OP - A combination of processes, technologies and data<br />
    17. 17. Data mining is the process of discovering meaningful new correlations, patterns and trends by sifting through large amounts of data stored in repositories, using pattern recognition technologies as well as statistical and mathematical techniques.<br />14<br />
    18. 18. Implementing Dynamic S&OPForecast Accuracy through Data Mining<br />Point of Sales Data<br />Data Analysis (by region, product category, sub-category, time slot…)<br />Identification of correlations, patterns, trends<br />Analysis of consumer buying behaviors to make operational decisions<br />15<br />
    19. 19. Implementing Dynamic S&OPData Mining integration into the S&OP process <br />Analysis of consumer buying behaviors to make operational decisions<br />16<br />
    20. 20. Implementing dynamic S&OP<br />Dynamic S&OP - A combination of processes, technologies and data<br />17<br />
    21. 21. Implementing dynamic S&OPKey Factors for Successful Dynamic S&OP Implementation<br />Clear Expectations<br />Top Management Support<br />Effective Collaboration<br />Collaboration Tools<br />Cadence<br />Performance Measurement<br />Analysis<br />18<br />
    22. 22. Benefits of Dynamic S&OP<br />19<br />
    23. 23. Improved product availability<br />Higher supplier fill rate<br />Reduced obsolescence<br />Increase forecast accuracy and sales<br />360° Supply chain Visibility End to End<br />Enhanced collaboration and better teamwork<br />20<br />Dynamic S&OP Benefits<br />Higher customer service, profits and growth<br />
    24. 24. Dynamic S&OP provides deep analysis and forecast to respond to a volatile environment and leverage supply chain productivity<br />21<br />
    25. 25. Full presentation including case study is available on: http://www.icognitive.com/index.php?option=com_phocadownload&view=category&id=6%3A&download=102%3Adynamic-s-op-msco&Itemid=64&lang=en<br />iCognitive Downloads: http://alturl.com/878ek<br />22<br />
    26. 26. iCognitive, an expert in supply chain innovation<br />BENCHMARKING<br />CONSULTING<br />RESEARCH IN SUPPLY CHAIN<br />TRAINING<br />TECHNOLOGY<br />23<br />
    27. 27. Thank you 谢谢<br />For more information please contact us at<br />info@icognitive.com or +65 6325 2810<br />