Archive for Sales and Operations Planning

Matching Demand Forecast Periods to Production Lead Times

It is common to speak of a “one number” demand forecast. And a “one number” forecast works fine if your demand forecast and your manufacturing planning are based on the same time period. For example, if you do a monthly forecast and the plant uses it to plan production for the entire month, then there is no inconsistency. But a lot can happen in a month. I was briefed a while back by Nitin Goyal, […]

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S&OP is Not About Technology. Wrong!

At the IE Group’s Sales & Operations Planning (S&OP) Innovation Summit last month, several of the speakers, including some representing software vendors, said that people and process were far more important than technology in achieving S&OP excellence. But interestingly, the companies profiled in the case studies as having the most robust and mature S&OP processes all used advanced Supply Chain Planning tools.  I don’t disagree that managing culture change is the biggest challenge associated with […]

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Keeping SCOR of Your Supply Chain

I recently attended the Sales & Operations Planning Innovation Summit organized by the IE Group. One of the first speakers and moderator for the first day’s sessions was Rich Sherman, Director North America of the Supply Chain Council. Rich’s presentation made me realize that it’s been a long time since I  last wrote about the Supply Chain Council and that I was not up to date on some of the new enhancements made to its “Supply Chain […]

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The Unbiased Forecast

I’ve been interviewing supply chain executives at consumer goods manufacturers to learn how they are using downstream data. A key focus area for these executives is using this data to improve the accuracy of their demand forecasts. A couple of the executives I interviewed raised an interesting point about forecasting that I don’t remember coming across before: the importance of having an unbiased forecast. Forecasts, by their very nature, are rarely completely accurate. Historically, most […]

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The Value of Supply Chain Planning in a Recession

A few weeks ago, I had a face-to-face conversation with an executive from a consumer electronics accessories manufacturer. Since January 2007 this company has implemented five Oracle supply chain solutions: Demantra Demand Management, Oracle Advanced Supply Chain Planning (ASCP), Global Order Promising, Oracle Inventory Optimization (IO), and the Oracle iSupplier Portal (note: Oracle is an ARC client). Considering the size of this company and the scope of its implementation, this rollout was amazingly fast.  The […]

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An Asian Supply Chain Success Story

Once upon a time there was a global, medical products company that was very unhappy with the way it was treating its customers in Asia. The company’s main customers are hospitals that use its products in emergency room surgeries. Not surprisingly, its customers wanted a high level of product availability. But this was a problem because the company’s factories are primarily located in North America and Europe, even though Asia (excluding Japan) is its fastest […]

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Supply Chain and Marketing: A Growing Collaboration

I recently received a newsletter from Lehigh University’s Center for Value Chain Research that showed the American Marketing Association’s (AMA) definition of “marketing” right next to the Council of Supply Chain Management Professionals (CSCMP) definition of “supply chain management.”  Here are their definitions: AMA – Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.  CSCMP – Supply […]

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The Recession and the Outsourced Supply Chain

Companies that outsource manufacturing, logistics, call centers, IT support, and various back office functions can be better equipped to ride out a recession, particularly if the payments are transaction based.  Less demand means fewer transaction fees associated with supply chain services.  These companies have minimized their fixed overhead costs, and their warehousing, transportation, and manufacturing costs become variable costs that are strongly correlated to new orders.  This becomes even truer if your company can negotiate […]

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Advanced IBP Leads to Better Service and Profitability

The desire to improve service is the main reason many companies are investing in information technology (IT).  Achieving this goal is very difficult without a robust Integrated Business Planning (IBP) process, formerly known as Sales & Operations Planning.  The goal of sales and operations planning is to achieve high service levels by effectively balancing demand with supply.  This requires both internal and external collaboration.  Internally, at a minimum, the manufacturing, demand planning, and sales and […]

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Supply Chain Practices and Technologies to Improve Cash Flow

In a recession, cash is king.  What can your supply chain team do to improve cash flow?  What processes and technologies can help? The most obvious action is to lengthen payment terms with key suppliers.  Finance may do this without informing supply chain managers, but this works against the mantra of establishing an adaptive, demand-driven supply chain.  An adaptive supply chain can efficiently respond to unexpected surges in demand.  You will have a hard time […]

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