Abstract:
With the advantages of globalisation and global sourcing, UK businesses have to
manage longer, more complex, supply chains whilst facing increased competitive
pressures. Such an environment has lead to a renaissance in Sales and Operations
Planning (S&OP). S&OP is a decision-making process concerned with aligning the
capacity of organisations with market demand whilst integrating the process with
business strategy.
LCP Consulting, a leading specialist in customer-driven supply chain management, has
recognised that companies formally implement some level of S&OP but for reasons
unknown the process is often not sustained and the full benefits are not realised.
Therefore, this research investigated and identified the principal factors that enable and
inhibit the successful execution of S&OP.
The research first analysed literature to enable a four-phase S&OP model to be
constructed that depicts the typical evolution of an S&OP initiative. Through a
quantitative survey of 26 companies in the aerospace, automotive, and pharmaceutical
sectors, twelve influential factors grouped into three categories: behavioural,
technological and organisational, were identified. Their level of impact on each phase of
the S&OP initiative was subsequently quantified. From conducting structured
interviews, the varying levels of success and maturity for seventeen key S&OP
activities were detailed. Finally the research findings and analysis were consolidated
into a simple, practical tool that enables users to understand how to improve the success
and sustainability of an S&OP initiative.
The conclusion of the research states that a good understanding of the process,
committed top-level management, holistic performance measures, and data that is
accurate, timely and pertinent, are the key factors that help ensure successful S&OP.
Organisational complexity was found to inhibit successful S&OP, and aligning people’s
behaviours to the values of S&OP was found to be the hardest issue to address when
embarking on an S&OP initiative.
