The concept of Sales and Operations Planning is hardly new, but a surprisingly large number of companies, 72 per cent, have only started to make use of it in the past five years, according to a survey by consultants Bearing Point.
The survey, which focused on process industries in western Europe, also found some significant weaknesses in how S&OP is implemented, notably the supporting IT systems and a lack of S&OP integration to risk management to the finance function as well as to supply chain partners.
In addition, it found that top-management sponsorship and endorsement of the process was considered to be comparatively low.
The survey highlighted four areas where S&OP process improvements could be made:
1. Central process governance for effective process implementation and correct execution
2. Network collaboration across the company and across borders
3. Measurement and transparency to aid control over the business and its processes
4. IT support systems that can increase systems integration, levels of automation and speed
It’s taken as read that there are significant benefits to be had from S&OP, but if Bearing Point is right, all too often companies are missing out on the full benefits.
Perhaps its time to look again at how S&OP is being implemented.