Collaborative Sales Forecasting
Tiger Woods, S&OP and Elephants
As Tiger Woods s
lowly recedes from visibility in today’s fast paced, polyphonic, multi-media environment, I am driven to identify some sort of meaning in it all. And, in a world in which bits, bytes and terabytes of data stream before us daily this is no easy task. Living in an age when global conflict shares a table with global social networking, creating personal connections has become the Holy Grail. On occasion connections do occur. When this happens the information that fog my life temporarily lifts. So, ending a long day immersed in Sales and Operations Planning (S&OP), I ponder — do S&OP, Tiger Woods and Elephants share something in common?
At its best, a highly collaborative, data-driven Sales and Operations Planning process creates visibility. The consequences of bad choice become clear. And, elephants sitting in the room – or perhaps obsolescent inventory lying in a warehouse – cannot be avoided. In good S&OP scenarios are created, alternatives examined, and the path forward is understood. Often, the process of S&OP itself surfaces important issues that might otherwise have been missed. Were there early indications of bad choice in Tiger Wood’s behavior? Was his life story of discipline and perfection to good to be true? Was there an elephant in the room all along that we were all ignoring?
We all love a hero. And of course, we seek to avoid unpleasant experience. While the world worshipped Tiger, Tiger was spending his energy struggling to contain a boiling maelstrom of problems. There indeed was an elephant in Tiger’s room and neither he nor the rest of the world was willing to confront this painful fact until the elephant crashed through the house. The good news is that life will go on for the rest of us and Tiger will survive the storm.
However, in today’s troubled economy, corporate executives cannot afford to ignore the elephant’s in the room. There is no room for bad choice. Constant vigilance and decisive action are imperative. Sales and Operations Planning is a process that can elucidate the elephant in the room. Moreover, Steelwedge S&OP drives better decision making and good choice. Did a major customer in a remote region of the world just cancel a major order? If so, how should we react? Should we discount aging inventory before promoting new products? Can we improve profitability with a different price structure? The answer to these questions is the fuel that powers successful corporate governance. And, indeed the story of Tiger Woods, Elephants and S&OP provides an important message.
The economy is getting better, oil prices are up…what next?
Anyone following the news is aware of the now steady drumbeat (finally!) of good news on the economic front. Exports are up, Europe is doing better, home sales are up, and, of course, the stock market is up. But wait, what follows next? Oil prices are up. Soon, commodities prices will start rising. Then transportation costs will rise.
So what does this mean for manufacturers and how does it relate to Sales and Operations Planning (S&OP)?? Clearly, after many quarters of focus on efficient operations and lean inventory management, the focus will once again shift to managing supply chain costs. Transportation costs, materials costs, and eventually labor costs will eventually rise to prominence.
Are you prepared?
Effective planning is essential. How will your operations change if there is another oil spike? What will you do if a port is closed down by a strike? How do transportation economics impact lead times? These are just a few of the questions that must be understood by planners.
Ensuring that your S&OP Plan incorporates scenarios that mitigate these concerns is fast becoming essential. Ensuring that your team is aware and focused is even more essential. Today’s S&OP solutions such as Compass Express by Steelwedge offer the perfect antidote for these kind of challenges.
Sphere: Related ContentDoes Toyota Need to Forecast? When Lean Manufacturing Doesn’t Work
The relationship between sales forecasting, demand planning, and lean principles has been analyzed, evaluated, and debated for decades. However, in light of recent market volatility, this debate is final reaching resolution – executives overseeing even the most lean, JIT-focused supply chains, need to planning.
Chris Chiappinelli, a blogger associated with the Managing Automation Blog offers the following :
“Just in Time, in its purest form, is a thing of beauty. Read Toyota’s description of it on their website — it sounds like poetry in motion. But the marketplace doesn’t care for poetry. We don’t want to place our order and watch the gears — perfectly meshed though they may be — smoothly churn out our product. We want our hamburgers pre-cooked and waiting for us under a heat lamp. In that world, Just-in-Time has no place. It’s a museum piece, a relic of a more patient era. In this world of pre-heated hamburgers and mass customization, Toyota and its counterparts are forced to produce not to actual demand, but to expected demand. And that, my friends, not only belies JIT; it creates a huge amount of risk.”
“A New York Times article illustrates just how far from its roots Toyota strayed:Previously, plants operated under the sales force’s direction of “you make them, we will sell them,” said Real C. Tanguay, president of Toyota Motor Manufacturing Canada. Now the philosophy is, “if we can sell them, then you will make them,” he said.” “Oh, how the mighty have fallen. Who would have predicted that a Toyota executive would ever sum up the company’s philosophy as, “You make them, we will sell them”?”
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Steelwedge enables customers to better understand and anticipate demand through forecasting, collaborative engagement of field sales, and analysis of changes in sales pipeline opportunities. In today’s world, these are vital processes.
Sphere: Related ContentOnDemand Sales and Operations Planning in 30 Days for SAP Customers
Steelwedge today announced a new release called “Compass Express S&OP” which offers a highly scalable “out-of-the-box” S&OP solution that can be implemented in less than thirty days. The solution leverages Steelwedge’s award-winning Sales Planning and Performance Management Platform (SPPM) and advanced partnership with SAP. The solution also draws on leading-edge technological developments to usher in a level of ease-of-implementation and ease-of-use never before available.Steelwedge Compass Express S&OP delivers the full range of functionality available in SPPM in a packaged, best practice-based format that expedites implementation, integration and training. Standard functionality includes Executive S&OP, collaborative demand planning, revenue planning, and performance management. The next release of Compass Express will also include direct integration with SAP BusinessObjects Xcelsius and SAP BusinessObjects Explorer for enhanced data analysis, reporting and business intelligence capabilities. Steelwedge Compass Express S&OP also includes standard integration with Salesforce.com (SFDC).
Steelwedge Compass Express was developed in response to growing demand from manufacturing companies in North America, Europe and Asia for an easy, highly cost-effective packaged OnDemand S&OP solution with standard integration into SAP, very low upfront costs, low total-cost-of-ownership (TCO) and a subscription pricing model. “Steelwedge Compass S&OP represents a major milestone for the software industry. Compass Express offers a packaged, OnDemand S&OP solution with standard integration points that enables manufacturing companies to increase planning visibility and improve profitability,” said Glen Margolis, CEO.
Steelwedge Compass Express Release is scheduled for general availability in Q2 of 2009.
Sphere: Related ContentSteelwedge, the leader in OnDemand Sales and Operations Planning Solutions
Annual Sales up 160% over 2006 from existing and new customers deploying Steelwedge OnDemand Solutions; New Partnerships with Salesforce.com and Teradata
Pleasanton, CA – November 20, 2007 – Steelwedge Software , the innovator in OnDemand (SaaS) Collaborative Sales Forecasting and automated Sales and Operations Planning (S&OP), announced today that 2006 to 2007 sales grew by over 160%.
Representative customers launching Steelwedge Sales and Operations Planning (S&OP) applications include Juniper Networks, the leading provider of networking and security solutions; Honeywell, a diversified technology and manufacturing company; Nvidia, the worldwide leader in programmable graphics processor technologies; and Monster Cable, the world’s leading manufacturer of high performance audio cables. Examples of customers choosing the Steelwedge OnDemand Collaborative Sales Forecasting and Planning platform include Spansion, the world’s largest pure-play provider of Flash memory solutions and, EDS, a leading provider of information technology and business process outsourcing services.
New Partners include Salesforce.com AppExchange and Teradata. In September, Steelwedge announced the release of its OnDemand Sales and Operations Planning solution (S&OP) for salesforce.com’s AppExchange, extending CRM functionality to provide comprehensive sales forecasting and sales and operations planning (S&OP) solutions for manufacturers of complex products in the AppExchange high tech and manufacturing vertical. In October, Steelwedge entered into an agreement with Teradata, the data warehousing leader, to provide the S&OP component in Teradata’s SAP APO Accelerator enabling large enterprises to achieve real Demand Drive Supply Networks (DDSNs.)
“We are pleased that the world’s leading high technology manufacturing companies are selecting Steelwedge to drive their sales and operations planning and collaborative forecasting processes,” said Steelwedge CEO Glen Margolis, “Steelwedge’s unparalleled technology and S&OP expertise ensures that our customers quickly derive enormous value.”
ABOUT STEELWEDGE
Steelwedge Software. Inc. links Sales & Operations Planning (S&OP) processes to existing systems through familiar desktop applications including email and Excel. Steelwedge helps companies improve the effectiveness of their S&OP, Collaborative Planning, Sales Forecasting, sales planning, and Performance Management activities. Steelwedge customers include Harley-Davidson, Hewlett-Packard, Honeywell International, Emerson Electric, Juniper Networks, Monster Cable, Nvidia, Spansion, Tellabs, Enterasys Networks and Teledyne.
For more information, please visit www.steelwedge.com.
TAGS: sales forecasting, sales planning, S&OP
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