aligning supply and demand with sales & operations planning · pdf filealigning supply and...
TRANSCRIPT
Aligning Supply and Demand with Sales & Operations Planning
Kamal D Soni, Sr Presales Consultant
Business Analytics Software, IBM India/SA
Business Challenges
• Customer service pressures– Customers are more demanding
– Demand changes and fluctuations
• Driving profitable, highly efficient supply chains– Must manage extended lead times
– Reduce cost of goods sold without sacrificing servicelevels
• Managing supplier relationships– Outsourced production leads to greater reliance on suppliers
– Communication and synchronization challenges
• Difficult to achieve both flexibility and predictability – Consistent performance is key to success
– Must remain flexible enough to adjust to changing demands
Sell Fulfill DistributeProduceProcure
SUPPLIER MANUFACTURERDISTRIBUTION
CENTER RETAILER
Materials
Information& Funds
Materials
Information& Funds
Materials
Information& Funds
Breakdown identification point
Root cause is upstream
Customer Service Requires Total Supply Chain Visibility
Sell Fulfill DistributeProduceProcure
SUPPLIER MANUFACTURERDISTRIBUTION
CENTER POINT OF SALE POINT OF CONSUMTION
RETAILER
Materials
Information& Funds
Materials
Information& Funds
Materials
Information& Funds
Customer Service Requires Total Supply Chain Visibility
Monitoring Demand Forecast Accuracy
Monitoring Supply and Deployment
PlanMonitoring
Inventory Levels & Balance
Your supply chain impacts profitability, customer service and resource utilization
Manufacturing Performance Management
6
SCOR Metrics
S&OP Executive Review
Operational Planning & Execution
Integrated Financial Plan
Plan, Operational& Financial Data
AnalyticInfrastructure
• ERP
• Inventory
• Supply Chain
• Logistics / 3PL
• Customer Sales
• MES
• Syndicated Data
• POS Data
P&L Balance Sheet Cash Flow
Business Results
Go! Mobile
Scorecards
Dashboards
Reports & Analysis
Event Notification
DistributionDistribution
Sales & Marketing
Production
Sales & Operations Planning
• Supply chains becoming more sophisticated & decentralized
• Changing market conditions require near real-time visibility, and constant plan review
• An effective S&OP process:– Links day-to-day operations with business goals,
operational planning, and financial planning
– Unites disparate sales, marketing, operations, and finance functions
– Helps management model the effect of meeting demand on the company’s supply capabilities and financial goals
– Provides visibility into the P&L impact of plans
– Becomes the tool for senior executives to manage the business
S&OP Process Enabled by Cognos
Demand PlannersSalesMarketingProduct Management
Fulfillment &Distribution
Planning
Forecast Supply
Forecast Demand
Demand
Supply
Consensus
EXECUTIVEREVIEW
Resolve IssuesSet Direction
DetermineStrategic Impact
Use IBM Cognos 8 BI to Analyze ResultsCognos S&OP Blueprint
Re-ForecastBalance Production Plan to Fulfillment
& Distribution PlanConsensus Meeting
Executive Review & Linkage toFinancial Objectives
Supply ChainOperationsEngineeringLogistics
Sales and Operations Planning (S&OP) Blueprint
• Reconcile sales and demand forecasts with supply plans
• Identifies capacity, labor, supplier, material and financial obstacles to meeting the demand plan
• Allows capacity, cost, and throughput modeling of multiple products across multiple plants, to determine the right combinations
• Helps plan product mix among various plant and contract suppliers
• Evaluates supplier capabilities when creating the supply plan
• Provide the views and detail appropriate to each role
– Units, revenue dollars, labor hours, machine hours, etc.
• Monitor the plan on an ongoing basis using scorecarding and analytics, making ‘right-time’ adjustments as needed
• Model and assess the financial impact of supply/demand scenarios to create a multi-plant S&OP view
S&OP BlueprintBaseline Module
• Considers sales volume and promotions to drive revenue and demand volume plans
• Helps plan product mix among various plant and contract suppliers
• Allows capacity, cost, and throughput modeling of multiple products across multiple plants, to determine the right combinations
• Evaluates supplier capabilities when creating the supply plan
• Identifies capacity, labor, supplier, material and financial obstacles to meeting the demand plan
S&OP BlueprintFulfillment and Distribution Module
• Compare S&OP supply plan to fulfillment and distribution capability
• Mid-level master planning exercise– Production receipts to supply chain constraints
• Inventory Targets
• Distribution Center (DCs) space constraints
• Determine load versus capacity
• Determine need for supply chain outsourcing – 3PL, WH/DC capacity
– DC and Transportation Costs –based on variable and fixed cost drivers
– Allocation of demand to warehouses based on historical analysis and assumptions of movement from production facilities to DCs
• Analysis by business unit and product category
• Multiple scenario analysis and comparison
S&OP BlueprintExecutive Review Module
• Conduct “what-if” analysis to simulate the effect of S&OP scenarios on Balance Sheet and P&L performance
• Measure plan versus actual performance for sales, revenue, cost of goods sold (COGS), inventory, customer delivery metrics, and gross margin
• Easily analyze and drive performance by category, division, geography, channel or for the entire enterprise
• Deliver consistent plan performance visibility across all functional units, improving collaboration and consensus planning across the organization
1313
© Copyright IBM Corporation 2008 All rights reserved. The information contained in these materials is provided for informational purposes only, and is provided AS IS without warranty of any kind, express or implied. IBM shall not be responsible for any damages arising out of the use of, or otherwise related to, these materials. Nothing contained in these materials is intended to, nor shall have the effect of, creating any warranties or representations from IBM or its suppliers or licensors, or altering the terms and conditions of the applicable license agreement governing the use of IBM software. References in these materials to IBM products, programs, or services do not imply that they will be available in all countries in which IBM operates. Product release dates and/or capabilities referenced in these materials may change at any time at IBM’s sole discretion based on market opportunities or other factors, and are not intended to be a commitment to future product or feature availability in any way. IBM, the IBM logo, Cognos, the Cognos logo, and other IBM products and services are trademarks of the International Business Machines Corporation, in the United States, other countries or both. Other company, product, or service names may be trademarks or service marks of others.
Thank You