In the last decades, the S&OP/IBP (Sales & Operations Planning / Integrated Business Planning) process has been continuously changing, adapting to the moving needs of the companies but also to the technology and system evolutions. These changes can be summarized in the following graphic:
The users of S&OP/IBP now have the maturity and the expectations to use more and more scenario planning to help them base their decisions on facts, data and shared scenarios to plan for the future. The information systems are also offering more features to help the scenario planning or modeling with the so-called “big data”.
It is a true revolution: S&OP and IBP are not only based on assumptions anymore but on true, actual, real data reflecting consumers, markets, capacity… or whatever context input’s reality.
Why is it an important change? Because assumptions were made by people, generally one person, the owner of the assumption; who was in charge of following it and confirming, changing or canceling it based on what happened in real life and how they thought it would impact the future.
So, the quality of the assumptions was based on the ability of the people to have the right understanding of their environment and the required time to build, check and review the assumptions every month in preparation of the S&OP meetings.
This essential but time-consuming work can now be efficiently supported by new systems and technologies. These new systems can collect, gather, dig, analyze and make the data speak, providing a solid fact and database to almost all assumptions, instead of a perception base.
Is it this simple? Not at all!
Data is now available but the way to use it as a true pillar for decision making is still not fully implemented.
The reasons are diverse, depending on your IT application features are not available, not friendly enough or take too much time.
But the reasons could also be the missing competencies and /or the behaviors of people in the company. Companies are now utilizing the role of the Data Analyst. The purpose is to have people with the right skills and competencies who can study the data and present it to the leadership team for use across the wider business.
In terms of behaviors, the key success factor is that the leadership team trust the systems and data and does not fear losing their decision-making power because of the new fact and data approach. Without these last two points, no progress will be made in the use of analytics in the IBP process. So, for whoever is in charge of S&OP or IBP in your company, never forget to educate the leadership team on the S&OP/IBP process to get the full benefits. Oliver Wight can help you with this step. Explore our brand new suite of workshops available to book here: https://www.oliverwight-eame.com/workshops