Debrief 2
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Debrief 2. Debrief after round 2. Strategy in The Fresh Connection What is your strategy? How did you translate it into action? Was everything clear? Please give us your reflection in headlines Review team results. Maturity scan: Alignment and collaboration. Sales & Operations

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Debrief 2

Debrief 2


Debrief after round 2

Debrief after round 2

  • Strategy in The Fresh Connection

    • What is your strategy?

    • How did you translate it into action?

    • Was everything clear?

  • Please give us your reflection in headlines

  • Review team results


Maturity scan alignment and collaboration

Maturityscan:Alignmentandcollaboration


Debrief 2

Sales

&

Operations

Planning


What is happening 6 12 months from now

What is happening 6-12 months from now?


A typical board meeting let s eavesdrop

A typical board meeting:Let’s eavesdrop

President: “This shortage situation is terrible. When will we ever get our act together? Whenever business gets good, we run out of product and our customer service is lousy.”

VP Operations: “I’ll tell you when. When we get some decent forecasts from Sales and Marketing…”

VP Sales (interrupting): “Wait a minute. We forecasted this upturn.”

VP Operations: “… in time to do something about it. Yeah, we got the revised forecast – four days after the start of the month. By then it was too late.”

VP Sales: “I could have told you months ago. All you had to was ask.”

VP Finance: “ I’d like to be in on those conversations. We’ve been burned more than once by building inventories for a business upturn that doesn’t happen. Then we get stuck with tons of inventory and run out of cash.”

Source: Thomas F. Wallace, Robert A. Stahl, ‘Sales & Operations Planning’, 3rd ed., 2008


What is causing these type of discussions

What is causing these type of discussions?


No connection between business strategy and execution

No connection between business strategy and execution

No ownership, high forecast bias, no identification of gapsbetween forecast, plan, budget etc…

Execution

Business Strategy

We allmean well, but we get nowhere


Where does s op fit

Where does S&OP fit?

No ownership, high forecast bias, no identification of gapsbetween forecast, plan, budget etc…

Execution

Business Strategy

S&OP

We allmean well, but we get nowhere


What is s op

What is S&OP?

S&OP, at heart, is a very simple idea:

make forecasts of what you are going to sell and what you can make (or buy)

take actions to balance the equation supply = demand over the whole horizon you have decided you need to look at

look at the financial consequences of those actions versus your targets

initiate actions to address the difference between the target and the current, balancedforecast


S op is business planning in 5 steps

S&OP is business planning in 5 steps…

From Forecasting to Demand Shaping

Getting the right info to make decisions into the last 60 minutes of the process

Demand

Reconcile demand and supply

Reconcile with financial plans

Sales and Ops Planning

Meeting

Supply

“What if?” Rather than “Yes/No”

From Capacity Planning to Supply Network trade offs & design

Source: DeepParekh, Partner, Equus Group, LLC


S op is also about behavior and collaboration

S&OP is also about behavior and collaboration

“You have done well: you have consistently beaten your forecast.”

“You consistently under-forecast; please look into your process.”

“Your forecast is well below your target; this is unacceptable.”

“What options have you considered already and what can be done more to close the gap.”

“This is our bottom up forecast; this is our best outlook based on current plans; there is nothing I can do”.

“Our bottom up forecast fell short of target. We are working to improve our Q3/Q4 promotional program.”


Debrief 2

Marketing:

the promotion

will sell 400

Sales:we can sell 200

one

consensus

plan

Finance:

we have

budget of 300

Manufacturing:they will

only sell 150

  • Key decision making forum

  • Manage together

  • Routine things done routinely

  • Issues addressed early – efficient response & anticipation

  • Functional silo approach

  • Ineffective behaviour

  • Fire fighting

  • Lots of ad-hoc meetings

  • Lots of effort, little reward

Source: Red Pepper, Modified E&Y, 1999


Who brings what to the table

Who Brings What to the Table?

Engineering

Sales

Product

Development

Customer

Interface

Human

Resources

Marketing

Workforce

Availability

Product

Demand

Capital

Operations

Capacity

Finance

MPS and

Supplier

Constraints

Business

Plan

General

Management

Materials

Source: Launchbury, Keith J. Principles of Planning Omeric, 1999


How to translate this to the fresh connection

How to translate this to The Fresh Connection

Purchasing

Sales

Servicelevel

Demand pattern

Shelflife

Leadtimes

Quality

Reliability

Trade Unit

Strategy

Capacity

Improvements

Operations

Frequencies

Stocklevel

Fixed period

Supply

Chain

Adaptedfrom: Launchbury, Keith J. Principles of Planning Omeric, 1999


Strategy into action levels in version 2013

Strategyinto actionLevels in version 2013


Extensions in version 2013

Extensionsin version 2013


Decision making

Decision making

Sales

Operations

Supply chain

Purchasing

  • Decision making

    • Who is involved?

    • Whatsequencemakes sense?

sequence


Set up a logical sequence of decisions and roles involved for the fresh connection

Set up a logical sequence of decisions and roles involved for The Fresh Connection

Sales

Operations

Supply chain

Purchasing

Inventorypolicyraw mat. (batch size, safety stock)

Productioncapacity plan (shifts/projects)

Forecastingdemand (pattern)

Inventorypolicyfinished product (safety stock)

Supplierselection and agreements

Productionpolicy (interval / fixedperiod)

Production resources and allocation

Decideaboutportfolio/ customerservice

The valueproposition

Capacity plan inboundwarehouse

Capacity plan outboundwarehouse


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