Sales & Operations Planning (S&OP) keeps things in balance
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Sales & Operations Planning
Sales & Operations Planning is commonly abbreviated to S&OP by industry professionals. Sales & Operations Planning is focused on achieving savings by reducing your supply chain or logistics costs and/or improving your service level.
The key objective of Sales & Operations Planning is to optimally align the production and logistics activities with customer demand in order to maximize profitability.
At consulting firm Groenewout we help you to implement Sales & Operations Planning effectively. We share with you a set of business processes and business techniques that enable you to improve your responsiveness to fluctuations in manufacturing levels or customer demand. When providing S&OP advice, we tackle issues such as:
- The (re)organization of the supply chain business processes
- Job profiles relating to S&OP activities
- The set-up and functional design of the supply chain
- The definition of Key Performance Indicators (KPIs)
- Advice about acquiring S&OP software.
Just as with all our consulting services, our S&OP advice is supplied together with a pragmatic plan to ensure that the implementation phase runs as smoothly as possible.
Inventory control and production planning
For any company with a sizable stock, inventory management and inventory optimization are essential. At any moment in time, you must be able to know where a product is in your warehouse and how much stock you have. A warehouse management system (WMS) is normally used for this purpose, but it is important to regularly check that the inventory shown in the WMS correlates with the actual stock level.
This can be done by cycle counting or with a wall-to-wall count, for instance. In addition, effective inventory management enables you to determine when a product must be re-ordered or manufactured, and in which quantity. As a consultancy, Groenewout does not supply inventory management software. However, we can help you to improve the processes surrounding warehousing and inventory management. Over the years, we have gained considerable experience in the following areas:
- How much inventory is needed to achieve a certain service level?
- How can logistics and marketing be aligned more closely?
- What is the impact on inventory if your company grows at a rate of 10% each year?
- What is the impact on inventory if you consolidate two warehouses?
- What is the impact on inventory if you shorten a supplier’s lead time?
- How should the inventory parameters be set in the WMS / ERP system?
Just as with all of our recommendations, you receive a complete overview of pragmatic and ready-to-implement solutions for inventory management. This also includes overlaps with warehousing and production planning.
Optimizing your S&OP?
Sales & Operations Planning is focused on achieving savings by reducing your supply chain or logistics costs and/or improving your service level. The key objective of Sales & Operations Planning is to optimally align the production and logistics activities with customer demand in order to maximize profitability.
If you are keen to achieve the perfect balance between sales, inventory and production.
I’m here to help!
Alain BeerensManaging Director & Partner
I’m here to help!
Arthur ZondervanManaging Consultant & Partner
Topics in Sales & Operations Planning
S&OP for Dulcinea Farms
In order to give you a sense of our approach in the area of S&OP, we are pleased to outline a project we completed for Dulcinea Farms, a subsidiary of the world-leading agribusiness company Syngenta. Within its fully integrated supply chain, Dulcinea was seeking to improve the balance between the quality and volume of its crop production and customer demand, and approached us for advice. We started by conducting analysis to arrive at a pragmatic and complete evaluation of the existing bottlenecks and opportunities. Our analysis produced two different objectives, as follows:
- Supplying pragmatic recommendations relating to the sales order management process: an execution plan including relevant improvements, investment levels, operational savings, implementation plan and timing.
- Treating the findings from the analysis as a trigger for realizing overall improvements.