Based on a recent Steelwedge survey of more than 160 business leaders:
-89% are either experiencing or seeing signs of external volatility/change impacting their business and
-91% are planning on internal change (products, channels, services, markets) to also create planning challenges
Given that the majority of respondents face the need to manage some sort of change within their demand-supply networks, why is it that their S&OP processes are based on the paradigm of “business as usual?” Why is the emphasis on a very rigid, prescriptive approach to managing the S&OP process when business does not behave in that manner? It is disheartening, but not surprising to see the schism between the corporate strategic goals and the goal of the S&OP process.
But this too, is beginning to change.
During a series of integrated business planning seminars in Europe last week (Feb 7th, 8th and 9th), we discussed these issues with an audience of manufacturers and distributors from London to the Netherlands and we got the same perspective on anticipating change. In fact, since Europe is reeling under a tough financial climate, they expect to see significant amounts of change and volatility happen. It was our observation that European IT organizations are more entrenched in traditional, inflexible ERP systems which constrains their ability to respond rapidly to market conditions. Add to that, the challenge of managing a proliferation of stand-alone systems for demand planning, supply planning, and business intelligence that require significant integration to work together.
Business leaders however are looking for flexible tools that can accommodate inevitable change in their businesses. They are not trying to retrofit their existing process to a one size fits all approach through inflexible ERP and SCP applications but looking for ways they can augment industry best practices with innovations of their own.
At Steelwedge, we believe that S&OP technology should not only enable –but flex with– process. In other words, when new elements are added to the business like new products, new services, new channels, or other changes, it should be easy to identify the impact of each of those on the overall business.
Better yet, just like with your iPhone, wouldn’t it be great when it comes to your business decision making to identify a need and know: “there’s an app for that”? We think so.
With the Integrated Business Planning platform we can build simple open architecture apps that address new changes to business processes. For example, we saw an emerging need across many of our consumer and discrete manufacturing customers for a demand policy optimization tool which stratifies the corporate product catalog into products that can be statistically forecasted versus those that have to be dealt with in a collaborative manner. The demand policy optimization app was built in a matter of weeks using the Enterprise Enabled Excel user interface and integrated with the overall workflow.
This is a rapid deployment approach taken to the next level where end users and partners can now adapt to changing business conditions and flex their S&OP process. This is just the first of many apps that are bubbling to the surface as companies make the transition to more resilient planning tools and apps that help them manage change.
Across the industry we are seeing the shift towards adopting S&OP for growth rather than for getting control. Are your plans agile enough to accommodate growth? I’d love to hear from you.