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Purposful Collaboration: What it could mean for your S&OP process

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To view the on-demand webcast, visit: http://info.kinaxis.com/webcast-purposeful-collaboration?ac=pcsop&campaign=70170000000a8Oy&ls=community

Even with heavy investments in Sales and Operations Planning (S&OP), many organizations are not achieving material or sustainable breakthroughs. This is often because they are executing a sequential, disjointed process with contributors operating in their narrow functional box. In this on-demand, learn how purposeful collaboration can connect content, conversations, colleagues and communities to drive improved business outcomes.

Topics covered:

Harnessing and capitalizing on “working social” in a B2B environment
Using the key tenets of purposeful collaboration to enable effective decision-making, resolution and consensus building
Capabilities required to facilitate purposeful collaboration in S&OP
Changing the mindset away from the individual supply chain / S&OP functions to connecting functions and most importantly, people

Speakers:
Alan Lepofsky, VP and Principal Analyst, Constellation Research
With almost two decades of experience in the software industry, Alan helps organizations understand how to develop, purchase and implement collaboration solutions. Rather than evangelizing how social software can change the way people work, he instead focuses on how organizations can improve their existing business processes by providing access to the colleagues, content and communities that can help people get their work done more effectively.

Trevor Miles, VP Thought Leadership, Kinaxis
As vice president of Thought Leadership, Trevor serves as an expert source for Kinaxis customers, prospects, industry analysts and journalists. Known throughout the supply chain field, he has published many articles, presented at various industry events, and is the primary contributor to the Kinaxis 21st Century Supply Chain blog.

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Purposful Collaboration: What it could mean for your S&OP process

  1. 1. Copyright © 2014 Kinaxis All Rights Reserved. Purposeful Collaboration: What It Could Mean For Your S&OP Process Alan Lepofsky VP and Principal Analyst Constellation Research Trevor Miles VP, Thought Leadership Kinaxis
  2. 2. © 2010 - 2014 Constellation Research, Inc. All rights reserved. How Collaboration Can Improve Sales and Operations Planning Alan Lepofsky – VP and Principal Analyst @alanlepo Enable effective decision-making, resolution and consensus building Oct 2014
  3. 3. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Communications Is Not A New Idea 2
  4. 4. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Collaboration Is Working Together 3
  5. 5. © 2010 - 2014 Constellation Research, Inc. All rights reserved. The Evolution of Collaboration Software Email & Chat Blogs & Wikis 4
  6. 6. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Sharing Is The New Normal 5
  7. 7. © 2010 - 2014 Constellation Research, Inc. All rights reserved. 6 So Who’s Sharing? Millennials Vs. Boomers
  8. 8. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Defining Digital Proficiency Knowledge Education Experience Accessibility Comfort Beliefs Desires Trust Determines needs and behaviours Proficiency 7
  9. 9. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Not good at it Want to do it Good at it Don’t want to do it Good at it Want to do it Not good at it Don’t want to do it Knowledge Comfort 8 Defining Digital Proficiency
  10. 10. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Knowledge Comfort 9 Defining Digital Proficiency Holdouts Immigrants Natives Voyeurs Disengaged
  11. 11. © 2010 - 2014 Constellation Research, Inc. All rights reserved. The Evolution of Collaboration Software Email & Chat Blogs & Wikis Enterprise Social Networks 10
  12. 12. © 2010 - 2014 Constellation Research, Inc. All rights reserved. It’s Not About What You Had For Lunch 11
  13. 13. © 2010 - 2014 Constellation Research, Inc. All rights reserved. 12 It’s not about “being social” Connect people Make information available Improve business processes
  14. 14. © 2010 - 2014 Constellation Research, Inc. All rights reserved. ERP CRM 13 Getting Work Done In The Stream
  15. 15. © 2010 - 2014 Constellation Research, Inc. All rights reserved. The Evolution of Collaboration Software Email & Chat Blogs & Wikis Enterprise Social Networks Socially Enhanced Enterprise Software 14
  16. 16. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Social HR/HCM Learning/Development Customer Support Sales / CRM Marketing Supply Chain Engineering Sharing In The Content Getting Work Done 15 Finance
  17. 17. © 2010 - 2014 Constellation Research, Inc. All rights reserved. 16 Make “Social” A Feature of Your Processes Support Ticket Customer Record Marketing Campaign Social Network
  18. 18. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Network Effects 17
  19. 19. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Team Collaboration • Sales • Marketing • Support • Engineering • Finance • Etc. 18
  20. 20. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Cross Functional Collaboration Sales Marketing 19
  21. 21. © 2010 - 2014 Constellation Research, Inc. All rights reserved. All Company Collaboration 20
  22. 22. © 2010 - 2014 Constellation Research, Inc. All rights reserved. External Collaboration Customers Partners 21
  23. 23. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Here is where it gets really exciting 22
  24. 24. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Supply Chain Shipping Manufacturing Distribution Supplier Customer Supplier Supplier Invoicing Retailer 23
  25. 25. © 2010 - 2014 Constellation Research, Inc. All rights reserved. Recap • Understand the differences between Communication and Collaboration as well as the strengths and weaknesses of each • Collaboration needs to be woven into business processes • Networks effects = the more the merrier 24
  26. 26. © 2010 - 2014 Constellation Research, Inc. All © 2010 - 2014 Constellation Research, Inc. All rriigghhttss rreesseerrvveedd.. www.constellationr.com TM Alan Lepofsky @alanlepo
  27. 27. Copyright © 2014 Kinaxis All Rights Reserved. Why Purposeful Collaboration is so important for Effective S&OP Trevor Miles | VP, Thought Leadership @MilesAhead | +1.647.248.6269 | tmiles@kinaxis.com
  28. 28. 3 Copyright © 2014 Kinaxis All Rights Reserved. Class A People Technology Process Requires focus, alignment, and engagement throughout the company Adapted from Oliver Wight, Ventana Research and AMR Research Key Tech Capabilities  What-if analysis  Integrate supporting applications  Workflow management  Action item assignment  Automate financial reconciliation  Reporting & Visibility  Include executives, finance, manufacturing, demand planning, supply marketing, product engineering & design and IT  Use cross functional teams for developing & reporting  Align operations with strategic corporate objectives  Regular demand and supply reviews  Compare forecast vs actuals  Include multiple lines of business / brands / factories  Have all departments use S&OP output as the plan of record  Engage the CEO or CFO as the sponsor Sales & Operations Planning It cannot be performed without collaboration
  29. 29. 4 Copyright © 2014 Kinaxis All Rights Reserved. Traditional S&OP Description Gets in the way of collaboration Step 1 Data Gathering Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre-S&OP Meeting Step 5 Exec-S&OP Meeting Actuals Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Decisions. Recommendations, Scenarios, & Agenda for Exec Meeting Decisions & Updated Game Plan
  30. 30. 5 Copyright © 2014 Kinaxis All Rights Reserved. Traditional S&OP Description Results in slow, disconnected processes Step 1 Data Gathering Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre-S&OP Meeting Step 5 Exec-S&OP Meeting Actuals Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Decisions. Recommendations, Scenarios, & Agenda for Exec Meeting Decisions & Updated Game Plan How long does that take? CEO: I want to increase demand In Asia by 5% to compensate for revenue drop in Europe Demand Manager/Planner: Given the last 12 months history and our existing Marketing plans which countries make most sense? Is this spread across all product families? What about NPI? Supply Manager/Planner: Does the usual factory have capacity? If not, where else can we get supply? What will be the additional mfg & delivery cost? Which materials do we need to increase? Can the suppliers meet our new demand? If not, do we have alternative suppliers? Inventory Manager/Planner: How much RM, WIP, and FG do we need to carry? Where are we going to place it? Do we have the warehouse capacity? What does this mean in terms of min order qtys? How close does FG need to be to customers? S&OP Team: Do we have the right demand/supply balance? Will this meet the new revenue targets? Do we need additional Marketing campaigns? What-if the NPI does not take off as we assume? Executive S&OP Team: Can we live with the projected revenue shortfall? Have all the risks been considered? Will Europe drop even more if we shift Marketing emphasis to Asia? What-if we accelerate R&D by 6 months?
  31. 31. 6 Copyright © 2014 Kinaxis All Rights Reserved. Core Issues driving adoption of S&OP What we hear from all customers & prospects • Complexity (regulations, expanding product portfolios, rapid growing sales in emerging markets) – Less predictable demand • Multiple independent systems – Lack of visibility across the supply chain – Employee time spent on non-value-add data collection • Immature S&OP processes – Dependent on individuals and tribal knowledge – No standard metrics • Resulting in, amongst others, – Service levels below target – Excess and obsolete inventory – Asset utilization imbalances
  32. 32. 7 Copyright © 2014 Kinaxis All Rights Reserved. Supply Chain Decisions are Multi-Faceted Requires Trade-Offs which require Collaboration Growth Revenue Cost of Goods Working Capital Corporate Trade-offs R&D Strategy and Investment Asset Strategy and Investment Corporate Social Responsibility Investment Trade-offs Inventory Supplier Strategy Forecast Accuracy Customer Service Channel Strategy Product and Service Portfolio SC Trade-offs Sales Policies Distribution Policies Manufacturing Policies Procurement Policies Logistics Policies Returns Backorders Obsolescence First Pass Yield Material Yield Empty Miles Supply Chain Waste Adapted from Supply Chain Insights
  33. 33. 8 Copyright © 2014 Kinaxis All Rights Reserved. Core Issues driving adoption of S&OP It all leads to Purposeful Collaboration • Supply chains in all industries are facing increased Volatility, Uncertainty, Complexity, Ambiguity • Companies reduce the need for certainty by being able to Observe, Orient, Decide, Act • This requires increased Visibility, Agility, Alignment == Collaboration
  34. 34. 9 Copyright © 2014 Kinaxis All Rights Reserved. Rethinking S&OP It is not about improving the accuracy of the forecast and reducing the amount of uncertainty in the future, it is about eliminating the need for certainty. — Ronald W. Bohl, Eli Lilly Quoted by Kevin Cook, Merck
  35. 35. 10 Copyright © 2014 Kinaxis All Rights Reserved. Rethinking S&OP Step 1 Data Gathering Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre-S&OP Meeting Step 5 Exec-S&OP Meeting Actuals Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Decisions. Recommendations, Scenarios, & Agenda for Exec Meeting Decisions & Updated Game Plan
  36. 36. 11 Copyright © 2014 Kinaxis All Rights Reserved. Rethinking S&OP Step 1 Data Gathering Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre-S&OP Meeting Step 5 Exec-S&OP Meeting Actuals Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Decisions. Recommendations, Scenarios, & Agenda for Exec Meeting Decisions & Updated Game Plan
  37. 37. 12 Copyright © 2014 Kinaxis All Rights Reserved. Rethinking S&OP Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre-S&OP Meeting Step 5 Exec-S&OP Meeting Actuals Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Decisions. Recommendations, Scenarios, & Agenda for Exec Meeting Process: What is Different? • Collaborative • Continuous • Concurrent Technology: What is Required? Embedded: • Process Orchestration • Alerts/Responsibilities • Scenario Planning • Assumption Capture • Balanced Scorecard • Full Audit Trail
  38. 38. 13 Copyright © 2014 Kinaxis All Rights Reserved. SCM World, The Chief Supply Chain Officer Report 2014 , Sep 2014 Purposeful Collaboration is the means. Know Sooner. Act Faster.
  39. 39. Copyright © 2014 Kinaxis All Rights Reserved. Q&A Alan Lepofsky VP and Principal Analyst Constellation Research @alanlepo Trevor Miles VP, Thought Leadership Kinaxis @MilesAhead

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