S&OP - Glide path

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    Key area Key Sub-set Key Question Reacting Anticipating Collaborating Orchestrating

    1.1 Process GoalWhat istheGoal ofthe processand howarethe

    rolesdivided? (RACI)

    The processgoal isto developan operationalplanto cover supply to

    fulfillcustomer ordersand forecast, whiltsminimizing supply

    disruptionsandoptimizing (finishedgoods)inventory levels.

    Rolesand responsibilities(RAC)in the !"#$ processare unclear and

    there islimitedalignment

    The goalof the processis tobalance !upply and%emand basedon

    the best volume forecast (isovalue).#ptimizing both component

    and(semi&) finishedinventory levels.

    Rolesand Responsibilitiesofthe involvedfunctionsare clear and

    eachfunction ownstheir part ofthe process.

    The goalis toalign cross&functionalprocessesin support ofthe

    operating strategy to ma'imize opportunity, customer satisfaction

    whilst mitigating costs, by identifying rissandopportunities, value

    andprofitabilty.

    Rolesand responsibilitiesare clear at alllevelsof the organizationand

    there isseamless collaborationacrossthe functionsandteams.

    The goalisto have the commercialplan built onnd&to&nd(and

    cross&functionally aligned)insight ofrissand opportunties.The

    businessanticipateson andplans for *ser and!hopper demand.

    Capacity isbased onthese insightsandare adaptedaspart ofa

    continuousprocessof maing trade&offsbetween profitable growth

    and utilization

    1.2 Rewar Organi!ationHowis thenecessarybehavior beeninfluenced by 

    measures

    +oclear measuresof successare in place neither individually nor as

    ateam

    ndividualmeasuresare inplace andpeople-sperformance is

    measuredagainst these

    !haredmeasures and$s are alignedwith the !"#$ process,

    however the individualperformance system ($$/) ismeasured

    against individualtargets.

    !haredtargets, basedon the businessmodel, are inplace whichare

    part ofour annualappraisal. These are continuously reviewedas

    part ofthe !"#$ process

    1." S#OP$etricsWhat arethe !I"sdefined and tar#et beenset for 

    thethe $%&!process? 

    very functionand organizationwithinthe !"#$ processhasuni0ue

    $-swhich are be alignedwith eachother.+o common!"#$ metrics

    are inplace.

    &see 0uestionnaire for e'amples

    Ancommonset of$-sfor the !"#$ processhasbeenagreedwith

    allparticipating functions These are focusedon (finishedgoods)

    inventory management !ales#rganization!ervice leveland (!*)

    1orecast accuracy

    $sand targetsare cross&functionally aligned, aswell asthe bonusses

    that are connectedto these targets.Thisaligment drivesa

    collaborative approachtowardsshared goals.

    The targetsare differentiatedbased onthe businessmodel

    specificsand ranedaccording importance.Alignment, ownership

    andreward against these targetsis basedon 2nd&to&nd2 defined

    businessprocesses

    1.% S#OPResults'hereis clearand wideunderstandin# ofthe $%&! 

     process valueadd and results

    t isunclear tothe organizationwhat the resultsof the !"#$ process

    are

    Resultsof the !"#$ processare visible tothe ('&functional)

    organiationas3 4etter 1orecast, 5ower inventories, higher customer

    The resultsofthe !"#$ processcontribute toimproveed new product

    introduction(+$), higher revenue andincreased profitability.

    Alignment ofthe organizationand supply chainthroughimporved

    !"#$ helpsthe businessto leverage the opportunities

    2.1 S#OP$eetings

    What content isdiscussed inthe $%&!meetin#s

    whoare theparticipantsand howare decisions

    beenmade

    5ong andlaboriousmeetingswhere ey decisionmaers are often

    absent andthe focusis onvolume for the ne't month

    !hort term (upto ne't 6 months)focussed meetingsgeared at

    ensuring assetsare alignedto meet the (ordered)volume and

    value.

    !hort, crispand focussedmeetings withclear agenda-sin which

    volume andvalue upto 78 monthsout are assessedtogether withthe

    rissand opportunities, basedon maret andcustomer insights.

    !trategic decisionsare made andparticipationof the re0uiredlevelis

    high.

    The !"#$ meetingsreview the fullprofitability implicationsfrom

    the value andvolume demandplannd&to&ne, basedon upto 79

    monthshorizonand mae conscioustrade offsfrom commercial

    organizationstosupply centers.

    * !rocessAli#nment 'owhat e+tend arethe involved functionsali#ned

    inthe decision,ma-in#? 

    !"#$ ise'ecutedon factory and:or commercial(country) level.

    %ecisionsare alsomade onthislevel.

    !"#$ isdone across the entire supply chain3 from commercial

    organisationsto!upply (;4*:R4*)units witha dominant focuson

    achieving budget:A#$ for eachorganization individually

    !"#$ ise'ecuted onthe levelthat isoptimal (regionalor global)for

    the businessacrossc ommercialorganisationsand supply unitswith

    clear focusonintegralprofitability andcutomer service.Trade&offs are

    made suchthat the resultsfor total company are optimized.

    !"#$ isoptimizedacrossnd&to&nd value chains.%ifferentation

    taesplace according tobusiness&:operating model.1ocus on

    creating value andprofit inentire chain

    .inancial Ali#nment/Howare theoperational viewand financial viewbe

    ali#ned? 

    !"#$&planand Rolling 1orecats(R#1#) are separate plansand

    processesto establishthese not aligned

    !"#$ isthe basis for the rolling forecast (R#1#), however

    ad6 :> ? C on si st en t 7 8 m on th s ro ll in g f or ec as t

    *1 2 e ci si on 3 a- in # H ow a re d ec is io ns b ee n ma de i n th e $% &! p ro ce ss ?  

    %ecisionsin meetingsare made inan unbalancedway3 2The most

    vocalperson inthe room2.The !upply team decideson the supply

    volume per !* toenter inthe system andthe decisionmaing

    dependson2how we are performing2

    The commercialorganization2owns2 the forecast:demandplan in

    volume andvalue the operating unitsdecide uponthe production

    andinforms the commercialorganisation

    4asedon the demandplan, across&functionalteam maesthe

    decisionto correct the businessplanwith clear corrective actions

    towardsthe $s.

    Allfunctions are e0ualpartnersin reaching consensusaround

    actionsto improve salesandprofit performance basedon the latest

    !"#$ forecast, over aminimum of78 months out ,including if 

    necessary capacity aduality

    /easure of the 0uality ofthe Commercial!toc on

    handin the $hilipswarehouses.This toindicate the

    0uality ofthe inventory and highlight potential

    obsolescence ris ('cess"Aging stoc)

    JG 6G to JG *nder 6G 7G

    nventory %1!

    Tocompare Total!toc withfuture %emand(on

    Co!)and translate it into%ays. Tobe comparedwith

    capability of!upply Chainon4;:Category 5evel.

    T4A &/E;

    nventory Turns Bow often the inventory is sold:used. T4A & /E; toK

    5ead&time @e want to measure our turnaround speed

    Consistency @e a chi eve th i s l evel o fp erforman ce HIG o ft h e t i me @e a chi eve th i s l evel o fp erforman ce HIG o ft h e t i me @e a chi eve th i s l evel o fp erforman ce HIG o ft h e t i me @e achieve thislevel ofperformance HIG of the time

    $etrics

    /easure of the store:product availability against an

    agreedlisting

    A$R&Gartner$aturity Gri

    1.Goal

    $aturity 4e*els

    Peror+ance le*els that lea to e)cellence 0ote5 nee to be custo+ise per business3

    6or'ingCapital

    $anage+ent

    *.unctional

    ali#nment 

    ".Process

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