Sales and operations planning (S&OP) is a process that achieves alignment between various functions of an organization including sales, production, inventory and finance. It develops a coordinated operating plan that balances supply and demand at a volume level in support of customer demand and business strategy. The S&OP process results in monthly planning activities based on an annual operations plan and provides benefits such as enhanced teamwork, better decision making and financial planning, and increased accountability.

2. ¤ Definition
¤ Role
¤ Process
¤ Benefits
¤ Value
¤ Implementation
¤ Uses

3. What is SALES AND OPERATIONS
PLANNING (S&OP) ?
¤ is an integrated business
management process through which the
executive/leadership team continually
achieves focus, alignment and
synchronization among all functions of
the organization. The S&OP plan includes
an updated sales plan, production plan,
inventory plan, customer lead time
(backlog) plan, new product development
plan, strategic initiative plan and
resulting financial plan.

4. ¤ is a powerful decision
making tool for business
executives as well as
line managers.

5. S&OP’s role is to
balance supply and demand
at the volume level.
Companies who do a
good job at this level find
much less problem at
balancing the supply and
demand at mix level.

6. S&OP is effective because it
develops a well coordinated operating
plan in support of your customer
demand, your business plan and your
strategy. It gives a complete picture
of forecasted demand, supply capacity
and corresponding financial
information.

7. ¤ S&OP is the result of
monthly planning activities.
¤ It is usually based on an
Annual Operations Plan (AOP)
that acts as the company's
annual target in terms of sales
and supply.

10. ¤ Enhanced Teamwork
¤ Embedded Communications
¤ Better Decisions And Better
Financial Plans
¤ More Focused Accountability
And Greater Control
¤ A window Into The Future

11. To assess the value of S&OP for your
company, consider these typical problems that
are addressed by the S&OP process:
¤ Organizational structures where are each
department or business unit operates and
plans for inputs independently of one
another, often out of alignment with the
corporate strategy.
¤ Financial plans are inaccurate resulting in
high variances between budget and actual
results.
¤ New products regularly miss their launch
dates.

12. IMPLEMENTATION OF S&OP
¤ highly focused on top
management, “Implementation
begins and ends with the Leader
(president, CEO, general manager)
of the business’.
¤ if they’ve implemented S&OP
and teamwork hasn’t visibly
improved, they didn’t implemented
it well.

13. EXECUTIVE S&OP:
¤ It is an executive decision-
making process.
¤ Balances demand and supply.
¤ Ties operational plans to financial
plans.
¤ Is the forum for setting relevant
strategy and policy.
¤ Is what we called, for years,
SALES AND OPERATIONS PLANNING

14. THANKS FOR
LISTENING
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