Description
S&OP is a commonly discussed but infrequently mastered area of planning. S&OP requires inputs from other planning systems, and requires collaboration on the part of Sales, Finance and Operations. S&OP is long term planning that attempts to match supply and demand and provides a financial plan to support the firm’s strategy. S&OP is in part a subcategory of consensus based forecasting, however, it means driving to a consensus from what are more often than not branches within the company or entity that are more competitive than collaborative. This is no easy task. Beyond the political aspects of S&OP, S&OP is a software challenge because it means both planning at a higher level of aggregation than other planning processes, while also exposing the specific constraints so that those constraints can be evaluated for alteration. Secondly, if a change is made in the S&OP system, how does that change flow down to the lower level planning systems?
