High Tech Perspective: Overlooked Opportunity from S&OP
 

High Tech Perspective: Overlooked Opportunity from S&OP

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Steelwedge Agility Webinar Series ...

Steelwedge Agility Webinar Series

Featured Presenter - Dennis Omanoff, a well respected leader, consultant and lecturer who has lead end-to-end global supply chains at major multi-billion dollar public companies and start-ups

Kick off the New Year with perspective from Dennis Omanoff, whose deep experience as Chief Supply Chain officer at some of the High Tech industry's largest manufacturers like Seagate and MacAfee will illuminate a discussion on the hit-and-miss realities of using S&OP to make a difference in High Tech business. Mr. Omanoff will offer his view and real world examples, of where S&OP strategy, practice and technology could be better used to sense and respond to the changing dynamics that are a particular challenge in the High Tech industry.

Register for this webinar to learn about how you can approach the most overlooked potential of S&OP in High Tech customer value networks: Driving Top Side Revenue.

Key topics include:
• the biggest, and most overlooked opportunity of S&OP
• connecting “the other side” of the sales order
• changing focus from 30 day P.O.’s to daily/weekly change response

Presenters:
Dennis Omanoff is a well respected leader, consultant and lecturer who has lead end-to-end global supply chains at major multi-billion dollar public companies and start-ups in the Information Security, Networking, Storage, Telecom and Retail sectors.

Nari Viswanathan is the VP of Product Management and Marketing at Steelwedge and was previously the lead Supply Chain analyst at Aberdeen.

For more information about S&OP, please visit: http://www.steelwedge.com/solutions/

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  • Didi to open session, introduce speakers to turn over to Dennis for opening context and remarks from his vantage point as Chief Supply Chain Officer across numerous industries, but most recently with leading high-tech businesses at Seagate and MacAfee…
  • Dennis: I’d like to start today with a look at the challenges increasingly commanding the attention of the C-suite across the High Tech Industry….(Add some perspective on what you saw atSeagate, MacAfee regarding) volatility of an interdependent supply chain, variability and complexity in configure to order markets, impact of global emerging marketsand time constraints of fast and fickle customer tastes.
  • Dennis:S&OP is well established practice for managing supply chains in High Tech.But there is a chronic problem where the incentives for salespeople trying to make a revenue number and those of procurement people trying to save money lead to poor forecasts no matter how disciplined the S&OP process. What seems to be missing is any mechanism for placing a meaningful value on the flexibility that customers demand from their suppliers. This means strong customers push for costly things like dedicated inventory at VMI hubs and super-short lead times for delivery. Suppliers feel unable to push back despite knowing that such demands create waste in the value chain that all must ultimately pay for. For smart High Tech organizations, powering the flexibility can net in A HUGE HIDDEN VALUE OF S&OP– TO DRIVE TOP SIDE REVENUE. For the rest of this webinar, we’ll look at where YOU are in leveraging S&OP; compare that with your peers, and talk to how you can approach delivering top side revenue from S&OP at your organization.(Dennis it add examples of large high tech firms that missed this lesson….)
  • Dennis:Let’s take a moment to check in on today’s webinar audience and see where YOU are.Please see the polling panel on the right side of your screen and click the answer that best fits with how YOUR COMPANY uses S&OP today to deliver top side revenue.PLease select:#1. If you are using S&OP to deliver top side revenue today#2. If you aren’t doing it yet but it’s a 2013 priority#3. If you aren’t there, but want to learn how#4. if you don’t do it and don’t see how you could.Note: Dennis and Nari, Didi will step in and ask you each for your take on the results. Unlikely that we’ll have a majority of #1 votes, but please think about how you will respond to a majority vote at any level. What does that say about potential S&OP Maturity, type of High Tech company, etc?Now, Dennis makes the segue to the next slide to compare these results with a study done in late 2012 with 600 supply chain leaders, who analyzed where they captured most of their S&OP value today…
  • Dennis:Lets step back to take a look at where companies ARE capturing S&OP value today.Three Level of Value for S&OP:InternalExternal and Information VisibilityWhile Internal and Information Visibility are better captured today, we could do better overall….let me tell you first
  • Dennis:Let’s move to our second poll.Go back to the polling panel to the right and chose the number corresponding to the response that best matches your situation.Note: Dennis and Nari, be prepared here to comment on the results and how closely they do or don’t mirrow what you each have experienced in the market….Dennis then segues to the next slide with results from the August study done with SCM World….
  • Dennis:(Talk about the issue of conflicting agendas….)
  • Dennis[Introduce the idea of S&OP maturity and ownership. Talk about why that matters in High Tech manufacturing when it comes to the unique and complex pressures of balancing supply/demand, NPI, internal/external and information visibility.]Ask for Nari to comment on this.Then focus on the key role of sales….
  • DennisBut the most common issue is leaving everything with the sales order…. This can’t be as flexible as High Tech manufacturers need to be in today’s volatile economy and market, as we discussed at the beginning of the session.If you can connect customers and suppliers to the “other side of the sales order” then you start to unlock the potential….and explore the missing link…
  • Dennis:Flexibility Pricing today with S&OP “as is” . (talk to this slide)
  • Dennis:Here is where you start to see that value…. (talk to this slide)And the best way to drive that value is by powering better data visibility,I am going to turn it over to Nari to talk to the advantages of S&OP technology to link internal and external stakeholders and information from one platform….
  • NARIFirst, I would like to hear from you. Please return to your polling panel on the right of your screen and select the numbered answer that most aligns with your situation as it relates to data access and visibility.
  • NARI:
  • NARI:Let me give you an example of how this works…..
  • NARI to deliver..
  • Nari
  • NARI
  • NARI
  • NARI

High Tech Perspective: Overlooked Opportunity from S&OP High Tech Perspective: Overlooked Opportunity from S&OP Presentation Transcript

  • © 2013 Steelwedge Software, Inc. Confidential. 1Plan. Perform. Profit. High Tech Perspective: Overlooked Opportunity from S&OP Jan 15, 2013 Single Line of Sight: Plan, Perform, Profit
  • © 2013 Steelwedge Software, Inc. Confidential. 2Plan. Perform. Profit. Presenter: Dennis Omanoff Dennis is a seasoned executive in Supply Chain and Procurement with experience across security, storage, networking, telecom and retail sectors. Recent leadership positions at Seagate and McAfee resulted in low inventory backlogs, low cost of goods as a percentage of sales , and high annual inventory turnover rates. Dennis was appointed by the U.S. Secretary of Commerce to serve as a Malcolm Baldridge National Quality Examiner. A member of the advisory board for SCM World, he lectures at universities and is a frequent keynote speaker at industry events. President, Omanoff Consulting Twitter: @DennisOmanoff
  • © 2013 Steelwedge Software, Inc. Confidential. 3Plan. Perform. Profit. High-Tech Challenges•  Volatility: Manufacturing supply chains face ever-increasing threats from unexpected natural disasters such as the Japanese tsunami and Thai floods Increasing High Tech Demand/Supply Pressures: •  Escalating Variability: Configure-to-order customization demand growing •  Uneven Markets: Emerging markets lead growth but high buy/use fluctuation •  Fickle demand: Consumers change mobile devices every 7 months
  • © 2013 Steelwedge Software, Inc. Confidential. 4Plan. Perform. Profit. The Over Looked Value of S&OP In High Tech: Driving Top Side Revenue
  • © 2013 Steelwedge Software, Inc. Confidential. 5Plan. Perform. Profit. Poll #1 Do you use S&OP to deliver top side revenue? 1. Yes 2. Not yet, but it is a priority for 2013 3. Not yet, but want to understand how to do it 4. No
  • © 2013 Steelwedge Software, Inc. Confidential. 6Plan. Perform. Profit. Value Captured from S&OP Today Source: SCM World, 2012
  • © 2013 Steelwedge Software, Inc. Confidential. 7Plan. Perform. Profit. •  Leadership/Internal Engagement •  Customer Engagement •  Connecting the “other side” of the order: Supplier Engagement •  Information Visibility Getting to the Value of S&OP
  • © 2013 Steelwedge Software, Inc. Confidential. 8Plan. Perform. Profit. Poll #2 Who runs your S&OP? 1. Finance/General Management 2. Sales & Marketing 3. Supply Chain/Operations 4. Other
  • © 2013 Steelwedge Software, Inc. Confidential. 9Plan. Perform. Profit. Supply Chain Runs Most S&OP Today Source: SCM World, 2012
  • © 2013 Steelwedge Software, Inc. Confidential. 10Plan. Perform. Profit. When Sales is involved in S&OP, things work better Source: SCM World, 2012
  • © 2013 Steelwedge Software, Inc. Confidential. 11Plan. Perform. Profit. When Sales is involved in S&OP, things work better Source: SCM World, 2012
  • © 2013 Steelwedge Software, Inc. Confidential. 12Plan. Perform. Profit. Connecting Customers and Suppliers to the “Other Side” of the Sales Order Common practice: focus on sales order Downside: Supply disruptions - amplified by poor visibility into customer inventory and supplier capability Value of getting it right: Maximize revenue and customer loyalty; Create stockholder and stakeholder value
  • © 2013 Steelwedge Software, Inc. Confidential. 13Plan. Perform. Profit. The Missing Link: Flexibility Pricing Source: SCM World, 2012
  • © 2013 Steelwedge Software, Inc. Confidential. 14Plan. Perform. Profit. The Missing Link: Flexibility Pricing Source: SCM World, 2012
  • © 2013 Steelwedge Software, Inc. Confidential. 15Plan. Perform. Profit. Poll #3 What are you doing to deliver information visibility? 1. Collecting data in functional systems for respective departments (CRM for sales, SCM for operations, ERP for finance, etc.) 2. Connecting functional data manually with spreadsheets for monthly S&OP meetings 3. Connecting company-wide data with S&OP specific tools for monthly S&OP meetings 4. Connecting company-wide data with S&OP tools for updated access anytime
  • © 2013 Steelwedge Software, Inc. Confidential. 16Plan. Perform. Profit. Getting Better Insight from Information Power Internal/External Collaboration With an integrated S&OP technology platform, you can: ü Connect sales forecast, revenue plan and operational budget ü Visualize external demand from channel partners, VARs, and distributors ü Anticipate vendors’ supply disruptions, constraints ü Balance inventory levels, on–time delivery and customer service levels ü Forecast option attach-rates ü Allocate capacity and raw materials across multiple suppliers ü Plan new products via historical performance and curve modeling ü Enable configure-to-order as well as build-to-stock business models in the same environment.
  • © 2013 Steelwedge Software, Inc. Confidential. 17Plan. Perform. Profit. High Tech Case Study •  High value, configure-to-order product mix •  Extremely volatile global demand A single, inaccurate forecasting decision can cost $5M in lost revenue/surplus inventory Therefore, planning MUST: •  Allow visibility across sales, manufacturing and senior executives •  Access latest customer demand and supplier constraints •  Deliver aggregate and drill-down level of data views for meaningful insights •  Provide an automated, forward-looking estimate of working capital investment
  • © 2013 Steelwedge Software, Inc. Confidential. 18Plan. Perform. Profit. Steelwedge Solution •  Scalable data-integration platform integrates: –  Oracle (CRM), SAP (Manufacturing), Business Objects (Sales), Essbase (Corporate Finance) •  Powers collaboration and forecast visibility between 150 users •  Institutionalizes consistent demand data and revenue risk assessment –  8 global business units and 17 customer accounts •  24/7 reporting: real-time data and on-the-fly reports –  Customers (~ 15 parameters across 2000 locations) –  Products (~ 20 parameters across 115 SKU’s) –  Demand Opportunities (~ 40,000 across 7 years) –  Data @ Historical Points-in-time (~ 180 = 6 months) –  Forecast Perspectives (3 – Account Managers, Sales VP + Manufacturing)
  • © 2013 Steelwedge Software, Inc. Confidential. 19Plan. Perform. Profit. Optimizing S&OP for High Tech Manufacturers For the Sales Team ü  Collaborative forecasting: VARs, distributors, customers & sales ü  Plan at any level of detail: including configuration packages ü  Opportunity management: CRM integration ü  AOP visibility ü  View Cross-functional demand
  • © 2013 Steelwedge Software, Inc. Confidential. 20Plan. Perform. Profit. Optimizing S&OP for High Tech Manufacturers For the Product Management Team ü  Develop attach-rate forecasts ü  Support Fixed Bill of Material Planning ü  Forecast at the option level or the planning BOM level ü  Control planning granularity
  • © 2013 Steelwedge Software, Inc. Confidential. 21Plan. Perform. Profit. Optimizing S&OP for High Tech Manufacturers For the Planning Team ü  Drive company specific planning processes with One-Click Planning™ alert-driven workflow ü  Provide planning process visibility and progress reporting ü  Drive assigned or exception-based review policies
  • © 2013 Steelwedge Software, Inc. Confidential. 22Plan. Perform. Profit. Optimizing S&OP for High Tech Manufacturers For the Executive Team ü  Consolidate supply, demand and finance hierarchies into one model ü  Model business complexity and global volatility risks ü  Explore options to resolve gaps ü  Generate upside/downside demand scenarios ü  Enable capacity-adjusted scenarios to resolve exceptions. ü  Enable detailed planning assumptions
  • © 2013 Steelwedge Software, Inc. Confidential. 23Plan. Perform. Profit.
  • © 2013 Steelwedge Software, Inc. Confidential. 24Plan. Perform. Profit. For more information, contact us at www.steelwedge.com