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Revitalize Your S&OP Process

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You vividly remember all the hard work that went into implementing your S&OP process – the training, the consensus building, the report building, the promises, or perhaps you’ve inherited something  and it’s not what you envision S&OP should be. People are losing interest, or it’s just not delivering to expectations, what can you do?

 

We know that improving S&OP is a continuous process, but a concerted effort to examine a few key levers can go a long way in getting your process back on the path to serving as your company’s primary platform for continuous improvement. A few of those things include:

 

·        S&OP Vision – Revisit or define the vision of how S&OP should look and work in your company. Define and communicate the characteristics of the process you are looking for. Dissect what is preventing your team from achieving what you want.

 

·        Sponsorship – Is the Executive Sponsor still championing the effort?  Do you have the right member of the management team supporting and helping where required?  (Possibly with other management team members.)  Do you have a periodic review with the sponsor to address gaps and ask for his or her help in specific areas?

 

·        Lack of an Executive S&OP – If S&OP is only being conducted with middle manager involvement, you don’t really have S&OP. In most cases, an executive summary, KPI review, and decision making session as needed, can be worked into the monthly executive meeting efficiently. Look for a blog post dedicated to Executive S&OP soon.

 

·        Design – The design of the process and meetings may need to be examined. This could include things like whether you have separate meetings or processes for different divisions or whether all the divisions participate together. Do the meetings have the right owners and participants? It can be frustrating to have many people tied up when they don’t need to be there. Perhaps some can attend on an as needed basis depending upon the agenda. Is the design of S&OP aligned with the organizational structure? Maybe you have the right process, but the wrong structure.  S&OP could be highlighting an awkward structure that leaders continue to sweep under the rug. Rubs between the S&OP process and the org structure have come up every time I’ve implemented it. I also find some clients doing several parts of S&OP all in one meeting (e.g. portfolio, demand, supply, pre-S&OP), make sure you have separate focused meeting before you bring it all together to address exceptions and make cross-functional decisions.

 

·        Remember Best Practices – No deep dive discussions on orders, SKUs, or this month or next month executional details, save that for a weekly tactical meeting with those responsible for execution. Keep it focused on exceptions, if you don’t, your executives will check-out.

 

·        Preparedness – S&OP meetings are for decision making, people need to have done the prep work before walking in.

 

·        Key Performance Indicators – Make sure you’re reviewing the right ones against targets and discussing actions to address root causes of exceptions, don’t just throw some numbers up and move on.

 

·        Reports and Tools – Examine whether or not report formats are up to date, are highlighting exceptions for discussion, and aren’t too detailed. It’s OK to have supporting detail to back-up the S&OP reports to pull out if you need it. Dedicated S&OP IT tools (or modules within your APS or ERP systems are getting better, you may want to take a look at the latest software offerings, especially if you’re still on spreadsheets that are time consuming to produce.

 

·        Maturity Scorecards – A maturity scorecard that communicates and tracks the progress of achieving the vision is a great way to get everyone on the same page and set expectations for leaders and participants. I’d recommend rotating meeting raters to get everyone engaged and a system that scores implementation progress, best practices, meeting efficiency, effectiveness, behaviors, and results. 

 

By working on these items, you’ll be able to continually improve your S&OP process and get the results you deserve for your hard work.

Download the full article that was published in the Journal of Business Forecasting 

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