Is Your Global Planning Like Whack-a-Mole? [Part 1]
 

Is Your Global Planning Like Whack-a-Mole? [Part 1]

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Steelwedge Agility Webinar Series ...

Steelwedge Agility Webinar Series

Featured Presenters - Tom Wallace, S&OP Author and Educator, TF Wallace & Company and Nari Viswanathan, Vice President, Product Marketing & Management, Steelwedge

The sheer velocity of change - in business complexity, global volatility and available data is making the prospect of managing regional and global planning a more elusive mission, a bit like hitting a whack-a-mole with a mallet - only to have another pesky problem pop up somewhere else.

This session will explore how to tie together smart strategy and integrated software to capture and scale a process that can out-flex even the gnarliest of planning challenges.

Join S&OP author and educator, Tom Wallace, and Steelwedge VP, Nari Viswanathan, to learn how to:
• Do more with S&OP beyond "just" supply/demand balance
• Go global with smart strategy and scalable technology
• Turn your big data into big insights
• Build an agile enterprise: outmaneuver volatility

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    Is Your Global Planning Like Whack-a-Mole? [Part 1] Is Your Global Planning Like Whack-a-Mole? [Part 1] Presentation Transcript

    • 1© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comSingle Line of Sight: Plan, Perform, ProfitIs Your Global Planning Like Whack-a-Mole?May 29, 2013
    • 2© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comS&OP – Here To Stay?Born: 1979, Abbott LabsNorth ChicagoDied: Not Yet. On the contrary . . .
    • 3© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comThe Adoption CurveThere is a 15-25 year lag between thedevelopment of a new process and itswidespread adoption.Executive S&OP TodayExamples: ERP/MRP, TQM/6SIGMA, JIT/LEANInflection Point AInflection Point B
    • 4© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comWhat Has It Done? Balance Demand and Supply Integrate Financial and Operational Planning One Set of Numbers Earnings Calls Simulations Global Retail, Banking, Software, etc Enhance Execution of Strategic Plans
    • 5© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comSTRATEGYTACTICSS&OPQ - Is S&OP Strategic or Tactical? A - Yes
    • 6© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comWhere Is It Going? Balance Demand and Supply Integrate Financial and Operational Planning One Set of Numbers Earnings Calls Simulations Global Retail, Banking, Software, etc Enhance Execution of Strategic Plans Revitalize the Industrial Base of an Entire Country
    • 7© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comWhatever Happened to “Japan Inc.”?Answer: it has stagnated• No longer a monopoly on expertise with the Toyota Production System (TPS)/Lean• Rest of the world is catching up• Silos masked by TPS• Lacking S&OP – the primary coordination tool• “Keep the herd moving roughly west”
    • 8© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comEnergy AlignmentAccomplishment AccomplishmentS&OP: Weak or Non-Existent S&OP: Operating Well
    • 9© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comHow S&OP HelpsWith Energy Alignment• Superior Teamwork• Enhanced Communications• One Set of Numbers Internally• Enhanced Agility: Near Term/Tactical• Enhanced Agility: Medium & Long Term/Strategic
    • 10© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comWords From Wallace“Knowledgeable Japanese executives, academics, and consultants withwhom I spoke believe that the solution to the Japanese stagnation problemlies in S&OP.“They see S&OP as the catalyst to their “re-invention”: able to eliminatesilos and to enable far superior execution of strategic plans.“Many of them viewS&OP as the key – to renewed prosperity in Japan
    • 11© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.com
    • 12© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comEarnings Calls > Procter & Gamble• Annual Sales ~ $80 billion• Countries with Operations: 80• Number of Employees: 138,000• Number of Brands: 300 within 3 majorbusinesses:• Beauty & Grooming• Health & Well-Being• Household Care
    • 13© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comProcter & Gamble – Earnings CallsP&G’s Global S&OP Process operates on two axes:The 3 Businesses (Beauty & Grooming, Health & Well-Being,Household Care)The 5 Regions around the worldRequirement: Their S&OP numbers must match
    • 14© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comBusiness Unit andRegion Integration14BUABUBBUCBUDReg1Reg2Reg3 X XXXX XXXX XXX
    • 15© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comBusiness Unit and Region Integration15Alignment between the Businesses and the Regions:- Is essential- Is worked closely by S&OP people- Is made to happen prior to generation of earnings calls to Wall StreetThe leader of the Businesses and the leader of the Regions must be in syncbefore giving the numbers to the CEO and CFO
    • 16© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comS&OP’s Role at P&G“S&OP is one of the – some would say THE –primaryplanning tools within the company.”Dick ClarkGlobal Supply Network Ops1953 - 2011
    • 17© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comBASF – Global Production Optimization• The world’s largest chemical company –“The Chemical Company”• HQ in Ludwigshafen, Germany• Annual Sales ~ $72 Billion• Over 100,000 employees• More than 60 SBUs• 100 large manufacturing sites + many smaller
    • 19© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comRegionalDemandPlansGlobalConsolidationGlobalSupplyPlanGlobalS&OPMeetingRegionalSupplyPlansRegionalSales & OpsPlansThe Global S&OP Process at BASFOptimization
    • 20© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.com• Shift from local volume orientation to global valueorientation.• Increased visibility across the supply chain (Inventories,Sales, etc..).• Global transparency of supply chain costs and focus ontotal delivered cost.• Improved communications and teamwork across regionsand functions.• Increased profitability through simulation andoptimizationBenefits Achieved
    • 21© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comThe Bottom LineBASF has experienced substantial growth over thelast decade, bypassing major competitors to becomenumber one in the chemical industry.“While BASF does many things well, S&OP hascontributed significantly to helping us achieve ourpresent #1 position in the industry.”Alan MillikenBusiness Process Education Mgr21
    • 22© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comUsing Executive S&OP to Help Create an EntirelyNew BusinessCISCO SYSTEMSSan Jose, CaliforniaCommercial and Consumer ElectronicsAnnual Sales: $40 billion
    • 23© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comTelePresence:Video Conferencing on Steroids
    • 24© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comCisco SystemsFor Cisco, this initiative meant:• New Suppliers• New Contract Manufacturers• New Product/New Technology• New Customers and Market• A Brand New Business Unit
    • 25© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comHow They Did ItTelePresence S&OP process established with TP Business Unitand Central S&OP Staff. They set: Strategy against key operational objectives High-low scenarios for first six months Year 1 and Year 2 growth plans Inventory Buffering Strategies Upside Flexibility Targets Component Sourcing Strategies Capacity Expansion Plans includingInternational Contract Manufacturers
    • 26© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.com• Product launched on time and on budget• No major lead time increases during launch• Order fulfillment lead time: < 5 days• On-time shipments > 98%• Cisco now No. 1 in this multi-billion $ marketResults
    • 27© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.com“ . . . there’s no way we could have generated the98%+ on-time shipping performance and therapid response between order and shipmentwithout S&OP.”Brad TallmanSenior DirectorGlobal Planning
    • 28© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comComplexity, Change andCoordinationImpact of:Lean ManufacturingLengthy Supply ChainsDoing Business Globally
    • 29© 2013 Steelwedge Software, Inc. Confidential.Tom Wallacewww.tfwallace.comComplexity, Change andCoordination – Part 2Increased Complexity:• Doing Business Globally• Lengthy, Fragile and Non-Agile Supply Chains• Responsiveness/Agility• Customer Service Levels• Big Data• OtherConclusion:For most companies, the days of“Blood, Sweat and Excel” are over