S&OP Implementation: From Paper Plan to Working Routine

Sales & Operations Planning (S&OP) has been on the agenda at many companies for years. Yet organisations struggle time and again with the same question: how do you make sure S&OP does not stop at a nice presentation, but really comes to life in day-to-day practice?

What is S&OP and why does the implementation so often fail?

S&OP is the process in which supply and demand are aligned. In the ideal situation, sales, operations, finance and purchasing come together every month to make one integrated plan for the next three to eighteen months.

The theory is clear. Practice is stubborn.

Implementations generally do not fail through a lack of technology or data, but through four recurring causes:

• Lack of ownership: nobody feels truly responsible for the process
• Silo thinking: sales and operations talk past each other
• Overly complex set-up: organisations start with the end goal instead of a working foundation
• No leadership: S&OP requires commitment from the board, not just from the planner

The five phases of a successful S&OP implementation

At UC Group we use a phased approach that deliberately starts with what does work, not with everything that is missing.

Phase 1: Diagnosis

Where does the organisation stand now? We map out the current planning process, identify the biggest bottlenecks and determine the level of ambition. A maturity scan quickly provides insight here.

Phase 2: Design

We design an S&OP cycle that fits the scale and maturity of the organisation. Simplicity is the starting point. Better a simple process that works than an extensive model that nobody follows.

Phase 3: Pilot phase

We run the first one to two cycles together with the team. Learning by doing, adjusting where necessary, building trust in the process.

Phase 4: Embedding

The process is handed over to the organisation. Roles and responsibilities are clear. The tools and templates are set up. The agenda is fixed.

Phase 5: Improvement

After three to six months we look back together. What works? Where are the next improvement steps?

Which tools do you need for S&OP?

Fewer than you think. We regularly see organisations that wait for the perfect system before they start. That is a mistake.

A working S&OP process starts with good agreements, clear roles and a spreadsheet or simple planning package. Only once the process is in place does it make sense to invest in advanced tools such as an IBP solution (Integrated Business Planning).

What does a good S&OP process deliver?

Organisations that have implemented S&OP well generally see:

• A higher service level (fewer out-of-stocks, fewer rush deliveries)
• Lower inventory costs through better alignment of supply and demand
• Better collaboration between departments
• More grip on the future for the board and management

Do you want to know where your organisation stands?

UC Group offers an S&OP maturity scan that quickly gives you a clear picture of the current level and the most impactful improvement steps. Get in touch to discuss what fits your situation or view our S&OP consultancy service.