Ed. note: At Steelwedge’s May webinar, Lora Cecere, unveiled the results of a new study on supply chain agility and the role of S&OP in improving an organization’s response capabilities. Following the webinar, Lora took a few questions from the audience but we couldn’t get to all of them, so we threw out a short answer challenge. Answer 16 questions from the webinar as succinctly as possible. Here are the first eight in the series. -R
- What is the most surprising thing you discovered researching the importance of agility?
That only 13% of companies effectively tie S&OP planning to agility.
- How do you achieve agility when faced with long lead times (1 yr+)?
I believe that the longer the lead times the greater the impact that agility techniques can have on the supply chain. This is accomplished by modeling demand and supply volatility and building playbooks to anticipate these impacts on supply chain reliability. A mature S&OP process helps companies to align against variability.
- How can you visualize the process of sales and operations for long-term future, if this is so volatile?
Through role-based dashboards.
- What is your perspective of impact of “external changes” on stable industries such as mining, oil, gas etc? Customers simply need coal, oil or gas they do not care how these products are e.g. innovated,packaged, delivered etc.
I believe that this needs to be handled through market-to-market modeling in S&OP. Buy modeling demand shifts (e.g. the changing price structures of fuel alternatives) and market supply variability (the levels of stockpiles), companies can do what if analysis to mitigate market risks.
- In your opinion has S&OP technology with process and change management finally become the recommended approach, and if so why?
It depends. There needs to be a system of record for companies that have multiple S&OP processes.
- We have mixture of S&OP by Microsoft Excel and ERP. How do you rate the “flexibility” of specific supply chain software to cover specific needs?
ERP is inflexible, and excel is not deep enough. Neither are good alternatives.
- We use S&OP for supply / demand balancing of resources but find the complexity of the person’s skill set impacts our decisions. Any thoughts on how to balance the understanding of the detail against the need to make effective decisions?
This happens through the selection of technology that aligns with the skill sets with the what-if modeling. If there is still a gap, consider business process outsourcing.
- What are the critical success factors in implementing a S&OP/IBP in a large organization?
The most critical element is the building of a supply chain strategy and educating the executive team on why this matters.