Many companies implement Sales & Operations Planning (S&OP), but what they don’t realise is that S&OP goes way beyond processes and systems. ‘You have to deal with clashing interests, emotions and people who have different mindsets,’ says Slimstock’s Sales Director Jan Kraaijeveld. In his eyes, S&OP is where art and science meet.

Companies are increasingly aware that their success depends on the effectiveness of the supply chain, Jan Kraaijeveld observes. ‘You can offer beautiful products and set up the flashiest marketing campaigns, but if you cannot then deliver, everything stops. And the impact is clear: without the right stock, revenues take a direct hit.’

Due to the level of global disruption we’ve seen in recent years, executives have also learnt that to ensure reliable performance, they need to plan further ahead. ‘The days of rush orders and short-cycle thinking are over. Companies need to start thinking more long-term, look at what is coming, and make a plan for how they are going to meet demand.’

 

 

Scenario planning

Kraaijeveld continues: ‘Our clients have now got their operational inventory management in order and are implementing S&OP on a large scale. An important part of this is scenario planning.

Customer purchasing behaviour has become more erratic, so forecasts can no longer be based on historical sales data alone. Companies want to launch products and enter new markets. But they also need to prepare for disruptions. Within S&OP, you have processes and techniques with which you bring the information about this together and translate it into the right choices at management level.’

Change management

But S&OP is much more than introducing processes and systems. People determine the real success, according to the Sales Director. ‘S&OP is about getting Sales, Production, Finance, Purchasing and all other departments to come to a consensus.

That does involve a bit more than what is written about S&OP in textbooks. This is about change management, dealing with emotions, bridging cultural differences. What makes S&OP extra challenging is that every company has to implement it in its own way. What works well in one company may turn out totally wrong in another. And the pitfall here is that people lapse into operational issues.’

S&OP as art

In his view, S&OP should be considered not only as a science but also as an ‘art’. The art of including the human factor within the process. The art of getting parties on the same page and arriving at creative solutions. ‘We also have a lot of knowledge about this, which we share with our clients, such as through training courses and master classes.

We also like to bring clients into contact with other companies, so that they can learn from peers what the practical pitfalls are. Good inventory management is about people, processes and technology, and that applies to S&OP all the way. S&OP is a combination of science and art, and at Slimstock, we want to facilitate both aspects as much as possible. Only then can our customers outperform.’

FAQs

S&OP integrates sales forecasts with operational strategies to achieve alignment and efficiency across the supply chain.

S&OP requires not only rigorous data-driven analysis (science) but also adept management of human factors and organizational dynamics (art).

S&OP enables businesses to plan proactively, anticipating and mitigating the impact of global disruptions on supply chain performance.

Change management is crucial in S&OP as it involves aligning diverse departments and overcoming cultural barriers to foster consensus and operational efficiency.

Companies can optimize S&OP by leveraging scenario planning, adapting strategies to customer behavior shifts, and integrating best practices tailored to their specific organizational needs.

S&OP + IBPSupply Chain Tactics