Archive for the ‘Sales and operations planning (S&OP)’ Category

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Just back from vacation and had a link to this article in Manufacturing Business Technology by Jim Fulcher talking about S&OP challenges.  I absolutely loved the opening sentence: ‘Former boxing champion Mike Tyson once claimed, “Everyone has a plan until they get punched in the mouth.”’  Who knew that Mike Tyson was such a supply chain visionary?  The guys a genius!  (have you ever seen Mike Tyson and genius used in the same paragraph before?).  Brilliant line Jim - love it.

The rest of the article goes on to explain how Teradyne, a Kinaxis customer, uses our RapidResponse solution to help address their supply chain management business challenges and even includes a quote from yours truly.  I won’t repeat what is in the article, I just had to comment on the opening statement.

Aberdeen recently published a new report entitled Sales and Operations Planning: Aligning Business Goals with Supply Chain Tactics.  Because Kinaxis was a sponsor of this report, we’re able to offer a complimentary copy of the report through the end of August.  You can access the report here.

The report had over 300 respondents across a variety of industries and company sizes.  The goal of this year’s report was to identify how the S&OP process helps corporate executives accomplish their overall business strategy, with the four broad strategies being: product differentiation, customer service differentiation, cost reduction and profitability.

Aberdeen found that the Best-in-Class companies (the top 20% of respondents):

• Increased Return on Net Assets (RONA) over the last two years: 43% of respondents with 5% and above improvement
• Customer service levels (on-time and complete to the customer’s requested date): 97%
• Average cash conversion cycle: 15 days
• Average forecast accuracy at the product family level: 86%

In addition, Best-in-Class companies are:

• Two and a half times as likely to be proactively alerted when they are no longer on track to meet S&OP objectives
• More than twice as likely to have the ability to align the S&OP plan with the company’s financial goals
• Three times as likely to proactively monitor daily performance against S&OP metrics
• Twice as likely to have the ability to respond to unplanned events in a timely manner
• Twice as likely to utilize statistical analysis and fact-based decision-making

There are some really good insights in the report and you can’t beat the price.  Also, I recently wrote about tools to support the S&OP process here.