SCOR Project Workshop - Sales & Operations Planning (S&OP) Health Check - How is Your Pulse

1 © 2013 Steelwedge Software, Inc. Confidential.

October 22, 2013 With Peter Bolstorff and Nari Viswanathan

S&OP Health Check: How is Your Pulse?

S&OP Health Check How is Your Pulse?

Webinar Objective

1. Discuss the concept of S&OP sustainability

2. Introduce a simple S&OP Health Check assessment

3. Score your company

Copyright SCE Limited 2013 3

4

Peter Bolstorff

20+ years of experience in operations management, consulting, and executive

leadership (3M and Imation)

Experience: Manufacturing, Planning

Survived and prospered with S&OP, DRP, MPS, MRP, ERP – and many other 3

letter acronyms

Co-authored Supply Chain Excellence: A

Handbook for Dramatic Improvement Using

the SCOR model, 3rd Edition,

AMACOM Publishing 2011

2 Terms of service on the Supply-Chain

Council Board of Directors; past Plan Process

Technical Chair

Over 150 projects Supply Chain Excellence (SCOR)

50 S&OP Implementations

S&OP Sustainability

Principles

There are 18 factors that affect

S&OP maturity

Maturity can be calculated by

basic competency – yes, no, or

partial

Sustainability is defined by

maturity over time

Common Traps

Leadership turnover and the

‘boiled frog’ syndrome

Process ownership and the

‘rudderless ship’ syndrome

Goal setting and ‘functional

silos’ syndrome


Sustainability – Company X

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011 2012 2013 2014

Company X S&OP Maturity


Company X Facts

Consumer Products

Retail

Private Label and Branded

Segmented Customers

Collaborative with Key Accounts

Fortune 500

North America

ERP and Advanced Planning

Systems

Optimized Network


Timeline

2007 – pre-implementation

baseline

2008 – implementation (design,

pilot, rollout)

2009 – formal continuous

improvement


0%

20%

40%

60%

80%

100%

2007 2008 2009

Timeline

2010 – alignment issues with

plant, sourcing, and planning

2011 – Turnover in demand,

supply, and finance

2012 – President and supply

chain leadership change

2013 – Re-engagement based on

quick maturity assessment


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2010 2011 2012 2013 2014


S&OP Maturity

Quick Maturity Assessment

0 – No, my company does not perform this activity

1 – My company performs this activity on special occasions

based on business events

2 – Yes, my company performs this activity as a normal

business practice


Trading Partners

_ Does your SOP strategy define the relationship between collaboration with customers and demand planning? and with suppliers and supply planning?

_ Are collaborative processes integrated with your SOP process cycle?

_ Does your SOP process incorporate review of key performance indicators from collaborative activity?

_ Trading Partner Total


Organization

_ Is your SOP top down, driven by the leader of the business unit

or enterprise?

_ Does your formal supply chain organization reflect an effective

SOP structure? Globally?

_ As part of SOP, do you review a scorecard that balances

internal versus external measures?

_ Organization Total


Physical Flow

_ Have you defined rough cut operational capacity goals that are

they mutually agreed to by manufacturing, sourcing, and

planning?

_ Is your chosen operational strategy reflected in the item

configuration?

_ Are your cost, inventory, and service level metrics and targets

aligned and managed effectively?

_ Physical Flow Total


Process

_ Have you defined SOP process requirements based on best

practice?

_ Do you have documented Demand, Supply, Reconciliation, and

Leadership Review processes in the form of a blue print?

_ Do you have an SOP policy reflecting meeting dates,

participants, and agenda?

_ Process Total


People – Jobs

_ Is there a human resource strategy that supports the sustainment

of SOP?

_ Are all the supply chain job classifications aligned? Globally?

_ Do the performers understand the job goals (outputs they are

expected to produce and standards they are expected to meet?)

_ People – Jobs Total


Technology

_ Do you have appropriate technology (data, functionality and

reporting) that supports the SOP supply chain process blue

print?

_ Did you configure your system and master data based on the

business requirements defined in a TO BE process Blue Print?

_ Have appropriate technology performance measures been

identified?

_ Technology Total


Technology

Poll Question #1

_ Do you have appropriate technology (data, functionality and

reporting) that supports the SOP supply chain process blue

print?


Technology

Poll Question #2

_ Did you configure your system and master data based on the

business requirements defined in a TO BE process Blue Print?


Technology

Poll Question #3

_ Have appropriate technology performance measures been

identified?


Score

Add your ‘layer scores together

and divide by 36

Resulting competency or

maturity score can be viewed in

quartiles, pure percentage, or

using a grading scale

A > 90%

B > 80%

C > 70%

D > 60%

F < 60%


Detailed Assessment


Summary

The business environment is getting more complex

S&OP maturity can fluctuate based on a number of factors

A good S&OP assessment as part of continuous

improvement can mitigate maturity variation

The quick assessment can define improvement opportunities

as well as act as an education event for new team members



S1.1Schedule Product Deliveries

S1.2Receive Product

S1.3Verify Product

S1.4Transfer Product

M1.1Schedule Production Activities

M1.2Issue Product

M1.3Produce and Test

M1.4Package

M1.5Stage Product

M1.6Release Product to Deliver

D1.3Reserve Inventory and Determine Delivery Date

D1.8Receive Product from Source or Make

P1.2Identify, Prioritize and Aggregate Supply Chain Resources

P2Plan Source

P3Plan Make

P4Plan Deliver

Rough CutCapacity Plan

8 Week MasterSchedule

Replenishment STO

Material Requirements

Released Production Orders

Kanban Signal

Tactical Planning


Thank You! Scelimited.com

Using SCOR® Series

Supply Chain Excellence: The Blog

Linked in - http://www.linkedin.com/in/peterbolstorff

facebook - http://www.facebook.com/pages/Supply-Chain-Excellence/257802574290912

Twitter - https://twitter.com/#!/SCEsupplychain

Email: [email protected]

+1 651 439 3422

http://www.linkedin.com/in/peterbolstorff

http://www.linkedin.com/in/peterbolstorff

http://www.facebook.com/pages/Supply-Chain-Excellence/257802574290912






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mailto:[email protected]



27 © 2013 Steelwedge Software, Inc. Confidential. October 22, 2013

Technology: Making S&OP Feel Even Better


Role of S&OP Technology

Technology

Trading

Partner

Collaboration

Organization Physical

Flow

People Process

Technology has a role to play in every dimension.


Trading Partner Collaboration

Technology

Trading

Partner

Collaboration


Flow

People Process


Demand Collaboration: Everyone on the Same Page

Marketing Forecast

Account Forecast

Sales Manager Forecast

Demand Forecast

Inputs

Forecast,

NPI & EOL,

Product

Volume

Sales, Orders,

Opportunities,

Budget &

Master Data

Account Level

Forecast

Sales Region

Forecast

Demand

Review and

Geo Forecast

Consensus

Forecast

Planning Processes

Nightly

Transaction

Files

Demand

Analyst

Marketing

Account

Management

Sales

Management

Demand

Planning

Consensus

Team

Compass Inputs

and Outputs

Consensus Forecast

Insight

S&OP Apps

Customer Collaboration

NPI/EOL Modeling

Promotion Modeling

Historical Demand Analysis

Statistical BOM

Inverse SBOM

Supersession

S&OP Sales

S&OP Ops

Executive S&OP

Collaboration

Performance

Current Plan

Finance

Waterfall

KPI Dashboard

Collaboration

• Demand Collaboration

• Classic example of multi-

functional collaborative

process

• Critical to engage Sales

and Marketing

• Majority of S&OP

implementations fail due

to lack of sales or

management executive

participation

2.10 Marketing_3848_Marketing_Multi.xlsx

2.40 Acct Mgr XP Max Str_276_Account_Manager_Single.xlsx

2.80 Laptops Geo_2337_Demand_Planner_Multi.xlsx

Performance_Report_2011-01-23_13-07-15.xlsx

Current Plan Report.xlsx

../../../../../Opportunities/Opportunity Presentations/Demo Decks/Steelwedge - CE9StdDemo 20121001/Dashboard.xls

Collaboration Insight Report.xlsx


2.53 Cust VMI Laptops Max Stores-M

Products by Customer

Customer replenishment

forecast

Delta between customer and AM

forecast (supplier)


Organization

Technology

Trading

Partner

Collaboration


Flow

People Process


Orchestration of Global S&OP

Revenue, Margin, and Volume Scenario Planning Management and Reporting

Corporate Executive S&OP

Resource Planning - Key Material Planning - Strategic Business Planning (Divest/ Acquire)

Optimization & External Collaboration

Integrated Inventory and Network Optimization –

Strategic Partner Collaboration

BU2

BU3

BU1

Revenue, Margin and Volume Scenario Planning Management and Reporting


Physical Flow

Technology

Trading

Partner

Collaboration


Flow

People Process


Physical Flow Determines Approach

Volatility

Imp

ac

t

Statistical

Forecast

Collab &

Exception

Stocking Strategy: Min/Max,

Safety Stock, etc


Modeler

Update the marketing forecast in

units and revenue

Add Macro Economic Data

to influence the forecast

Product View for all

customers Add Market Size to determine the

market share percentage

Outlook Metrics



Accelerate S&OP Adoption and Business Value

Time

L1

L2

L3

L4

Q1 Q2 Q3 Q4

Val

ue

Accelerated

Time to Value

Step Change

Maturity & Performance

Avoid

Process Failure


• Technology is a key enabler across --and between-- all 6

dimensions of S&OP maturity

• Three examples:

• Trading Partner collaboration – Technology enables Agility and

Scale

• Organization – Technology enables Consolidation and

Reconciliation

• Physical flow – technology enables complex demand-supply

Network Modeling

Summary


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Category:	Technology
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