Practical Sales and Operations Planning

Every manufacturing business operates a Sales and Operations Planning process of some sort. Somehow we decide which customers to pursue, what promises we should make to those customers, how much product to produce, what people and other resources we need, how much inventory to hold and how we will operate our factories. Most businesses agree that they could do this much better.

Many companies have made at least one unsuccessful attempt to formalize and improve their Sales and Operations Planning process (S&OP). Often these failures center around getting accurate sales forecasts produced each month, setting inventory levels and production plans and managing the monthly S&OP process.

Some of the challenges faced include:

1. High inventories of some products and raw materials, often accompanied by stock-outs in others;
2. Failing to provide products or services to the customer when they are needed;
3. Production plans that change frequently;
4. High costs;
5. Unhealthy levels of friction between the Marketing, Sales, Production, Purchasing and Finance departments, and
   6.Frequent surprises, mostly unpleasant ones.

This book focuses on these solutions to these practical challenges:

1. Better sales forecasts with less effort
2. The right inventory levels
3. Stable production plans
4. S&OP that really works