s&op rfp 101: evaluating your erp vendor’s solution vs. the best-of-breed

1 © 2014 Steelwedge Software, Inc. Confidential.

Single Line of Sight: Plan, Perform, Profit

Agility Webinar Series

S&OP RFP 101

S&OP Automation: ERP Vendor vs. the Best-of-Breed


Today’s Presenter

Background

With over twenty years of experience leading design, development and

marketing of S&OP and supply chain solutions, Ed is responsible for market

assessment, requirements definition and go to market strategy.

Prior to Steelwedge, Ed was CEO and President of Amitive, Inc. (acquired

by GXS) which he founded in 2004. Under his direction the company grew

from start-up to a leading cloud supply chain planning provider controlling

complex supply chains around the globe.

Prior to launching Amitive, Ed designed and implemented global SCM

solutions for numerous companies, including Mitsui & Co., as a Sales and

Operations executive and consultant. Ed holds a Juris Doctorate from

Western State University, College of Law.

Vice President, Product

Marketing

Steelwedge Software Inc.

3825 Hopyard Rd

Pleasanton, CA 94588

Tel : (949) 588-1495

[email protected]

mailto:[email protected]


Agenda

• S&OP/IBP: High Level Overview

• Problem: The Spreadsheet Approach

• Solution: S&OP Automation

• Solution Evaluation Criteria

• Project Milestones and Challenges

• Q & A


S&OP: Led By and For Senior Management

What it is: Aggregate Planning, How Much, Big Picture, Product Families

What it’s not: Detailed Planning & Execution

Operational Planning: Master Scheduling, Plant/Supplier/Distribution

Scheduling


Pre-ESOP

Ground Reality: Trying It With Spreadsheets

Demand Planning, SCM/APS Systems

ERP, Financial, & Transactional

Systems SAP, Oracle, etc.

Industry

Data

Consolidation, Review,

Overrides

Data Collection,

Reconciliation

Consensus Process ESOP

Operations

Marketing

Sales

Finance

Manual

Complex

Security Risk

Not Scalable

Does this Give Executives

an Agile Decision Making Process?

Systems Landscape


Poll: Does this look familiar?


Change Your Reality; Drive S&OP Adoption & Values

Time

L1

L2

L3

L4

Q1 Q2 Q3

Step Change

Maturity &

Performance

Avoid Process

Failure

Q4

Val

ue

Accelerated

Time to Value

“Companies can have a hard time getting past basic levels of S&OP without

technologies like Steelwedge to support the process”

-Tim Payne

VP Supply Chain Analysis, Gartner


IBP/S&OP Solutions: Heterogeneous Landscape


Best Practice S&OP Aligns People, Process & Systems

“We continue to look at S&OP as an

aspect of business that needs terrific

improvement…

It’s hard to argue this shouldn’t be a

central piece of management software”

–Rob Kugel, Ventana Research


S&OP Technology Requirements




Industry

Data

Single Planning

Environment

Interactive planning for:

• Cross-functional Roles

• Plan Review

• Overrides

• Assumptions

• Scenarios

• Consensus Process

• Pre-S&OP

• Executive S&OP

• Audit Trail

Systems Landscape Product / Sub-Family Customer Revenue

Product / Family Territory / Region Revenue

Product / Family Promotions Revenue

Product / Family Region Units & Revenue

Product Stock Locations Units and Inventory

Family / Series Territory / Region Revenue, Margin & Cash

Family / Series / BU Geo Revenue, Margin & Cash

Product Production Site Units and Capacity



Planning Terms Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers

Cross-functional Planning

Environment

S&OP Technology


Poll: What are your value drivers?


Return on Investment is Substantial

Value Levers

50-70% Reduction

15-30% Improvement

20%-25% Reduction

25% Reduction in

Stock-outs

1-2% Lift in Revenue

Typical Results


Key Selection Criteria: Functionality



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality

Category Description

Sales Revenue Planning

Statistical Forecasting

Consensus Demand Management

Source, Inventory and Master Planning

Rough Cut Capacity

Product Allocation

Key Material Planning

Procurement Planning

Rough Cut Financials

Executive S&OP

Trading Partner Collaboration




Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Customer, Territory, Regional

Sales Plan

Stakeholders • Sales Management • Account Executives • Key Customers

Planning Terms • Product and Family • Account and Territory • Revenue and Units

Basic Features • Anytime access from the web. • Intuitive / user friendly interface. • Excel-like usability features. • Drill-down access to detail. • Assumption documentation. • On-line and off-line planning • Audit trail of changes. • Real-time override updates. • Scalable to large user group. • Forecast performance analysis.




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Statistical forecasting • Causal Factor Modeling • NPI / EOL / Supersession • Promotional Planning • Attach Rate Planning

Stakeholders • Demand Planners • Marketing Executives

Planning Terms: • Product and Family • Configurations / Bundles • Region and Geo • Units and Revenue

Key Features - Including Basics

• Statistical Forecast Engine • Curve-fit Modeling • Time Phased Attach Rates • Demand Consolidation (Ind/Dep) • Demand segmentation • Top-down, bottom-up and

middle-out planning




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Consensus Planning Stakeholders • Sales Management • Account Executives. • Demand Planners • Marketing Executives • Finance Planning Terms • Product and Family • Account, Territory, Region, Geo • Revenue and Units


• Cross-functional planning environment

• Plan translation for different roles.

• Multiple planning terms: Revenue, Units, Average Sales Price

• Single Sign-On




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Source Planning • Inventory Planning • Master Planning

Stakeholders • Supply Planners

Planning Terms • Product and Sub-family • Stocking Location • Units and inventory investment.

Planning Profile • Mid to long term horizon. • Volume to mix translation.


• Segmentation Analysis • Stocking Strategy • Replenishment Parameters • Simulation and Scenarios




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Rough Cut Capacity Planning

Stakeholders • Production Planners Planning Terms • Product and Sub-family • Production Site • Units and capacity

Planning Profile • Mid to long term horizon. • Volume to mix translation. Key Features - Including Basics

• Aggregate Capacity Planning. • Target Utilization Analysis. • Time Phased Capacity Modeling. • Production Site Transitions • Simulation and Scenarios




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Finished Goods allocation to

customer, channel or stocking location

Stakeholders • Demand Planners • Sales Managers • Account Managers Planning Terms • Product and Sub-family • Configurations / Bundles Planning Profile • Mid to long term horizon. Key Features - Including Basics

• Product Allocation to: o Channel o Stocking Locations

• Rules-based Allocation o Forecast, Targets, Backlog




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Key materials dependent

demand planning. • Key material allocation to

product, option or bundle. Stakeholders • Supply Planners Planning Terms • Key Materials • Configurations / Bundles

Planning Profile • Mid to long term horizon. Key Features - Including Basics

• Bills of Materials • Demand Consolidation (Ind/Dep) • Key Material Allocation • Key Material Segmentation • Key Material Stocking Strategy




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Commit planning for outsourced

products and key materials.

Stakeholders • Supply Planners • Suppliers

Planning Terms • Outsourced products • Key materials • Stocking Locations

Planning Profile • Mid to long term horizon. Key Features - Including Basics

• Trading Partner Collaboration • External collaboration views and

permissions • Access or data exchange

options o Manual Entry o Data Upload o Data Exchange




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Finance planning • Proforma P&L, Balance Sheet

and Cash Flow

Stakeholders • Finance executives

Planning Terms • Revenue & Margin • Inventory Investment • Units

Planning Profile • Mid to long term horizon


• Live financial view of: o Annual Operating Plan o Demand Plan

– Unconstrained – Constrained

o Procurement Plan o Inventory Plan

• Revenue Recognition Shift




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Analytic Activities • Revenue, Margin, Cash • Market Share

Stakeholders • C-Suite Executives • Sales and Marketing Execs. • Supply Chain Execs. • Finance Execs.

Planning Terms • Revenue and Margin • Inventory Investment • Units

Planning Profile • Mid to long term horizon. • Annual Operating Plan • Unconstrained demand plan • Constrained supply plan


• Live executive analysis of supply and demand plans.

• Scenario based decisions and documentation.




Rough Cut Capacity

Product Allocation




Executive S&OP






Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers


Key Functionality


Sales Revenue Planning Planning Activities • Commit collaboration for both

customers and suppliers.

Stakeholders • Account Managers and

Customers • Procurement/Supply Planners

and Suppliers

Planning Terms • Units • Price • Cost


• Trading Partner Collaboration • External collaboration views and

permissions • Access or data exchange

options o Manual Entry o Data Upload o Data Exchange




Rough Cut Capacity

Product Allocation




Executive S&OP




Poll:

Phased S&OP implementation?


Key Evaluation Criteria: Crawl, Walk, Run

Key Functionality


Sales Revenue Planning

Phase 1 Statistical Forecasting


Source and Inventory Planning

Phase 2 Rough Cut Capacity

Product Allocation



Rough Cut Financials Phase 3

Executive S&OP

Trading Partner Collaboration Phase 1, 2 or 4 ERP, Financial,

& Transactional Systems

SAP, Oracle, etc.

Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers



Key Selection Criteria: Solution Profile



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers



Solution Profile


Systems Required Number of systems needed for the featured solution? Different applications and data bases. Each designed from a different perspective. Consider the data silos created and the amount of data exchange.

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required Do all users have an intuitive and easy to use interface? Users are skilled in using Excel and expect similar functionality. Extent of expert level training needed? Seamless flow of planning activity vs. switching between multiple systems. Seamless data flow vs. creating data silos and latency.

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required Typical implementation time? Measured in months vs. quarters or years? Phased approach or Big Bang? Phases can provide a quick win and proof-point for next phase? Long implementation has risk of being out of date with long implementation.

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required Is the solution configurable to meet your business model v. forced-fit solution? Option to leverage best practice configuration? Support for phased approach? Accommodate common structure changes or data changes (hierarchy levels, sales organization, etc.).

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required How well established is the solution? • More than 10 customer deployments

in production?

• Version number greater than 2.x?

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required Cloud-based or on-premise solution?

Cloud Advantage

• World-class Data Security

• Rapid Configuration

• Seamless Upgrades

• Simplified Integration

• Massive Scaling & Performance

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required Years active as an S&OP solution provider? Core competence in S&OP? Recognized thought leader in S&OP?

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




Solution Profile


Systems Required Percent of provider resources focused on S&OP?

Ease of Use

Time to Value

Flexibility

Proven Solution

Architecture

S&OP Experience

S&OP Focus



Industry

Data

Systems Landscape


Environment

S&OP Technology

Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers




IBP/S&OP Provider Comparison


Steelwedge is a strong leader in S&OP and IBP

“Steelwedge is an ideal solution for a heterogeneous environment with multiple S&OP processes

with inputs from multiple ERP and APS technologies.”

Lora Cecere

Founder and CEO, Supply Chain Insights

“Steelwedge has grown into one of the market's leading S&OP solutions". “Steelwedge has

proven that it provides a capable and scalable Stage 3 S&OP solution suitable for global

deployments.”

Tim Payne

Research Vice President, Supply Chain Research Group, GARTNER

Steelwedge was among the highest ranked in capabilities scoring and was one of “the vendors

that were notable in portfolio strategy and portfolio benefits delivered.”

Simon Ellis

Supply Chain Practice Director, IDC


Tom Wallace – The Guru of S&OP

“ Sometimes people ask me about the S&OP

module from their ERP provider.

I respond that the next really good S&OP

software package that comes from a main line

ERP vendor … will be the first. We have yet to

see that happen.

You need to look and best-of-breed. And the

best of the best-of-breed is Steelwedge ”.

Tom Wallace,

Founder, T. F. Wallace & Co

Watch the video: http://www.youtube.com/watch?v=SVWaNiBC4Jo&index=4&list=PLF5EAC415A68DC43B

Integrated Business Planning for S&OP – Master Class with Tom Wallace: http://www.youtube.com/playlist?list=PLF5EAC415A68DC43B

http://www.tfwallace.com/

http://www.youtube.com/watch?v=SVWaNiBC4Jo&index=4&list=PLF5EAC415A68DC43B

http://www.youtube.com/watch?v=SVWaNiBC4Jo&index=4&list=PLF5EAC415A68DC43B

http://www.youtube.com/playlist?list=PLF5EAC415A68DC43B




Crawl – Walk – Run Approach

• Key to success is incremental value

• Start with quick win as phase 1 & foundation

• Expand the roll-out adding value as you go


Key Implementation Milestones

• Mobilize teams

• Establish Project

• Planning

• Organization / Structure

• Governance Model

• Solution Orientation and Training

• Concepts

• Terminology

• Best Practices

• Process Driven Design Concept

• Reference System Driven

• Key business decisions:

• Design iterations

• Templates

• Reports

• Configurations

• Workflows

• Design specification

• Data Integration Guide

• Initial Customer Data

• Configured and tested system

• User acceptance testing

• Data validation

• Train the Trainer certifications

• Cutover prep and Support

procedures defined

• Execute cutover plan

• Migrate to Production

• Hypercare support

• User Q&A, issue resolution and

training reinforcement

• Transition to cloud support or

internal IT.

• Ongoing Enablement, Process

Improvement and System

Monitoring

Training & Concept Design

Go-live and Enablement

Design Iterations Configure and

Validate

Training & Concept Design

Design Iterations

Configure & Validate

Go-live & Enablement


Key Implementation Success Factors

46

Area Success Factors

Executive

Commitment

Executive involvement; help resolve issues, scope, resources and timelines.

Regular executive communications regarding project status (good or bad).

Project Scope Focus on current processes or expectations and how solution will support.

Maintain defined scope; avoid adding processes, functionality, components.

Project Team An empowered project team to make decisions and resolve issues.

Key resources available for defined activities and time frame.

Data Clear data element ownership and related system of record.

Special effort to resolve missing data or incorrect associations.

Comprehensive

Testing Align expectations through comprehensive user acceptance.

Production

Transition

Ensure processes are in place to support business and technical issues at

go-live.


Q&A Contact Us

Email: [email protected]

Telephone: North America +1 (855) 980.8800

United Kingdom +44 (0)121.232.4668

Netherlands +31 (0)70.7999.288

Japan +813-6277-8521


Poll Question 1

Is this the reality at your company?

• Yes, almost the same situation.

• We use Excel for everything and it works fine.

• We’ve automated some but still use Excel extensively.

• We don’t have that situation; our S&OP technology works well.


Poll Question 2

What are the key drivers of your S&OP automation initiative?

• Reducing Planning Cycle Time

• Increasing Forecast Accuracy

• Increasing Inventory Turns

• Increasing Customer Service Levels

• Improved Revenue and Margin


Poll Question 3

The first phase of your S&OP automation initiative will be:

• Sales Planning

• Demand Management

• Supply Balancing

• Executive S&OP

• We will implement all at once.

s&op rfp 101: evaluating your erp vendor’s solution vs. the best-of-breed

Software

marketing of sop

process systems

aggregate planning

spreadsheets demand

scmaps systems erp

transactional systems

best practice sop

scmaps systems key functi