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Lecture 8

33:799:301 Lecture 8: Week 5 - Part 1 - S&OP Planning


Department
Supply Chain Management
Course Code
33:799:301
Professor
A Taitt
Lecture
8

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Sales and Operations Planning
Aka Aggregate Planning
Executive team uses to continually achieve focus, alignment, and
synchronization
Objective
Allows company to evolve from reactive environment to
collaborative enterprise
Provides balanced scorecard
Creates accountability
Plans for the long term
Benefits
Clear plan on how job will be completed
Companies work to one set of numbers that everyone agrees upon
Costs go down because there isn’t over or under production
Goves management plans relating to company’s future
Integrated with financial planning to form more effective business
plan
More measured response to sudden changes in market demand
Superior to older models that only look at products without
accounting for variations
Why do Companies Fail
Lack of executive leadership
Lack of engagement and collaboration between all departments
Oversimplifying the process
Over-complicating process
Most Common Failures
Large S&OP failures are usually because of new products
Difficulties of Implementation
S&OP brings all demand and supply plans for a business together
Challenges to S&OP
Forecasting Accuracy
Assessing the Effectiveness of your plan
Having accurate, integrated data
Planning-focused people
Incorporating robust, flexible technology
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