Operations Leader’s Role in the S&OP Process

Operations Leader’s Role in the S&OP

What is the Operations Leader’s Role in the S&OP Process? First of all, the Operations Leader is part of the Roles and Responsibilities of S&OP. He/she needs to develop comprehensive plans to ensure adequate inventory is available. In order to meet all customer needs in the most efficient and cost-effective method possible. A strong S&OP process makes it much easier for Operations Leaders to do their jobs. 

Managing Manufacturing Capacity -Both Internally and Externally

Depending on your industry, there may be economies of scale for large production runs. However, not every customer requires, or can absorb, large inventory shipments. Sometimes it is necessary to repackage inventory to meet the needs of smaller customers. One example; your average production run is 180,000 pounds of polymer, but some of your customers can only accept 600 pound boxes. In that case, subcontractors might be needed to repackage inventory to meet the needs of smaller clients. The S&OP plan provides details of demand down to the Individual Stockkeeping Unit (SKU) level. Thus, it gives the Operations Leaders the opportunity to secure the necessary manufacturing resources to meet customer demand.  

Product Portfolio Management

The S&OP plan can help to proactively inform Operations Leaders of changes to the product portfolio. The S&OP plan also includes new product introductions and the phasing out of poorly performing products. With this knowledge, the Operations Leader can make sure to balance raw material supply relative to these changes in product specific demand. 

Raw Material Qualification

Many high-tech industries require pre-qualified raw materials in a product to meet exacting specifications. Each raw material product has its own lead time cycle for pre-qualification. It is often necessary to pre-qualify multiple vendors for the same raw material. It will help avoiding the vulnerabilities that come with single sourcing of raw materials. An S&OP plan provides clear insights into ongoing raw material needs. One of the Operations Leader’s role is to allow adequate time for the qualification of new raw material vendors.

Contract Manufacturer Qualification

It is also important to pre-qualify contract manufacturers. The Operations Leader needs to allocate an adequate time into the schedule so that any new contract manufacturers can be pre- qualified to help with production.

Product Distribution

Finally, knowing forecasted product demand is important. However, it is also important to know the geographical location of the demand. An Operations Leader needs to plan for product distribution. It might include warehousing and any international shipping requirements that may occur for global products. 

In short, the Operations Leader’s role in the S&OP process is at the very heart of it.

Learn more about Roles and Responsibilities of S&OP:

Sales & Marketing Leader’s Role in S&OP

Executive Management’s Role in the S&OP Process

Supply Planning and Master Scheduling

The Role of Sales Personnel in the S&OP Process

S&OP Process: What is the Demand Planner’s Role

Amélie Nicolas
Amélie joined QAD DynaSys end of 2020 and she currently serves as Digital Marketing Specialist where she is responsible for developing the digital marketing strategy, creating digital contents and managing the website and the blog of QAD DynaSys. Passionate about the new technologies and the digital culture, she is always on the lookout for new ideas and new digital trends to broaden her expertise. Avid world traveler, Amélie worked in Cyprus and North America for several years. Always looking for new challenges, she loves trekking around the World (USA, Canada, Thailand) and attempting new yoga poses!

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