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Sales & Operations Execution (S&OE): Leveraging your network to improve performance
Many businesses that have invested in Sales and Operations Planning (S&OP) have hit a curious issue: they continue to have out of stocks, over stocks or expedites. Furthermore, they report chasing short-term execution issues even though long-term planning is firing on all cylinders. There is a clear disconnect between their immediate needs and goals, even when focusing on just the next 30 days. To square this circle, the answer may be a value chain-centric view of Sales and Operations Execution (S&OE).
Improving your S&OE process allows your S&OP resources to focus on operational and strategic objectives, moving immediate actions and firefighting to dedicated execution focused staff. It provides a structured, exception management process to address demand and supply imbalances at the “right level of the organization” and within the capabilities of the supply network. Additionally, robust S&OE can allow for the minimization or even elimination of frozen periods, increasing agility, flexibility and velocity, as it minimizes the impacts from both supply and demand volatility. S&OE doesn’t eliminate problems but rather seeks to control their effect. When done well, it can even reduce reliance on safety stock or inventory buffers, improving cash flow.
Enterprise centric systems or processes that support weekly or manual updates from trading partners (customers, suppliers or carriers) and enterprise sites (manufacturing operations, distribution centers, retail outlets), may adequately support the monthly S&OP planning cycle and decision making, but cause serious issues and complexities within the short term, execution horizon. By leveraging network thinking using modern, multi-enterprise business networks or MEBNs to provide efficient and scalable real-time connectivity, collaboration, and visibility to your entire supply chain ecosystem, you can make decisions smarter, faster and more effectively.
Improve Customer Satisfaction / Assurance of Supply:
• Improve on time and in full (OTIF) / reduce stock-outs and late deliveries
• Enable postponement strategies, including in-transit supply, through network inventory flexibility and allocations
• Gain a real-time view of inventory and demand to proactively identify misalignment and actions to resolve
Reduce Cost & Increase Efficiency:
• Accelerate and automate end-to-end processes
• Reduce inventory buffers, improve working capital
• Reduce expedites