Simple Steps For Implementing An Effective Sales And Operations Process

Before you can implement an effective sales and operations process, you must understand its elements.  S&OP is, or should be, a monthly integrated business management process that positions organization leadership to focus attention on the organization’s drivers of its supply chain, including:

●  Sales

●  Marketing

●  Demand management

●  Production

●  Inventory management

●  Introduction of new products

Pulled from that list for these meetings will be the leaders of key organizational levels, all of whom should be at the table.  Among the agenda items will be:

Product review.  R&D leaders, product development leaders, and new product introduction leaders will play a key role in this review.  They will consider the health of current products, review product pipelines, and arrive at product planning decisions.  Future dates will be set for new production or the sunsetting of existing products, and the effect of cannibalization – new products impacting existing products in the marketplace.

Demand review.  The formation of consensus demand is the purpose of this review.  Marketing, the introduction of new products, trends in the marketplace, and even part demands, will prepare an overarching picture of demand, with the consensus demand based upon this combination of sales, marketing, and product plans, and is measured either in units or finance.

Supply review.  The supply plan must sync with demand planning, working together balancing customer service while minimizing inventory and operating costs.  The “If/Then” concept plays a part in this review:  if this happens, then we do that, if you will, from a strategic standpoint rather than tactical.  Taking the long view has the purpose of reducing risk and understanding variations and their necessary adjustments.

Finance Review.  Actual costs compared with forecasted costs, and the previous month’s performance compared with the current month’s are included in this phase.  Finance review should be a constantly flowing stream, always providing foundational data for the first three review processes.  Actual costs are compared with forecasted costs to allow for the analysis of forecast accuracy over time. 

These reviews are integral to S&OP, and the assembly of the data generated by each review will bring any disconnects and crucial gaps into focus.  Once they have been identified and addressed, the results can be passed both upstream and downstream within the organization. 

Ideally, this part of the process is displayed and viewed on a cloud-based platform that will house all of these review plans in a single place for all stakeholders to see. Revenue, profit, inventory, and operating costs impact the actual vs forecast analysis, allowing adjustments to be made in real-time.

Key decision makers then have the data, stored and presented in that cloud-based platform that is home to all reviews, upon which to make fully informed and timely decisions.  They will know when they need to make critical choices, and in turn, those choices are input into the platform for ongoing analysis and review month to month.

The Atlas Planning Platform is one such cloud-based technology that services each review process from birth and allows it to evolve and mature over time..  John Galt Solutions can help with those early steps and guide you in their evolution. The success of an organization is at stake, and the sales and operations process serves that purpose. 

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