Do companies need to substantiate and quantify critical risk scenarios as part of their planning process?

Financial analysts evaluate return and earnings potential on a risk-adjusted basis. In other words, analysts incorporate an understanding of the volatility associated with returns when evaluating the underlying value of a business.

Today the only certainty is uncertainty.  How can one plan in a world seemingly dominated by unanticipated terrorist events, political upheaval in and around oil producing nations, natural disasters striking presumably well prepared, developed economies wreaking global havoc, and energy production disasters of all sorts?

What does this mean for planners? Validated and informed risk management and risk-based decision making is more important than ever.  Quantitative support and innovative solutions can help measure and estimate impacts; facilitate key business, financial and operational scenario management, and reduce the uncertainty attached to strategic growth, budgeting, change, and macroeconomic volatility.  In this environment sales and operations planning must truly be transformed into some sort of risk-adjusted integrated business planning scenarios (IBP).

What Will You Say When Shareholders Ask: “What Happened?”

Accurate quantification and assessment of risk is paramount to an organization’s success.  Executives need to ensure that their organizations are undertaking an efficient and effective process of quantifying risk.

Are key decisions made in the context of risk-adjusted scenarios?  Should we be doing some sort of actuarial analysis?

Is there an understanding of the full range of financial outcomes associated with a particular S&OP scenario?

Can we able to back up our scenarios with substantiated, sound, risk analysis?

Do we know how much risk and/or volatility can be sustained?

Does our organization have the right tools to navigate inevitable “Black Swan” events that will disrupt the best laid S&OP scenarios?

Are we confident that we have posted liabilities to match the risks our organization faces?…

There’s a lot of really good information out there about S&OP, supply chain management, demand forecasting, business intelligence… but you’re busy. You’re probably too busy to keep up with everything. Seriously – do you have time to read the scores of books and journals and blogs that promise to fill you in on everything? Somehow, you need to find a way to filter out what you need to know, which is the best advice, and what really isn’t worth the free download.  There are some terrific resources out there, if you know where to look. Sometimes, however, the most obvious filter is to go straight to the top of the field. A few words from the acknowledged experts addressing the most important questions of the day can save you a lot of time and money.

Along these lines, some of our folks have posted thought-provoking discussions with Lora Cecere, a partner with Altimeter Group, and Blake Johnson, a Stanford University professor, on our website. These are short videos in a series – you only have to listen to what you need to know right now. You can always come back for other topics. Yes, we’re going to ask you to register once, but after that it’s a free ride.  In the series’ first installment, Lora Cecere discusses the business challenges that are driving S&OP adoption. You’ll learn why Lora has concluded that companies with strong S&OP processes and tools are flourishing in today’s economy, and in fact, are able to sense changes in demand five times faster than their competitors. Lora is a partner with Altimeter Group and is known as a supply chain visionary who understands technology. She brings seven years of industry analyst expertise coupled with two decades of manufacturing, marketing and software expertise.…

The week’s Blog entry is provided courtesy of Christian Smagg, a respected French SaaS expert. Further commentary by Christian can be found at http://www.saastream.com/my_weblog/   Christian’s experience is very simliar to the Steelwedge experience on a daily basis – demand for SaaS appliciations are rising.

As experienced in previous economic downturns, companies that invest smartly during the bad times, emerge quicker, and better equipped to grow faster after the recession. Thinking creatively about how to do more with less is the key to IT innovation during challenging times and allow companies not only to survive but also to seize the extraordinary opportunities that arise during periods of vast uncertainty. When you think about it, creative application of new technologies during weak economies actually gave rise to huge waves of productivity like Software-as-a-Service, Web 2.0 or social networking.

But fear is driving decisions at many companies these days, causing this unhealthy lock-up of budgets. Current miasma should not slow down or prevent companies from innovating and creating value so as to survive, weather the economic storm or even outperform competition.

Financial crises are often having a huge impact on IT departments, resulting in significant increases in business activity, placing greater burden on IT resources and forcing them to find new ways to boost productivity while slashing expenses. At times like these, it is highly recommended that companies seriously consider leveraging applications delivered via a software-as-a-service (SaaS) model, harnessing the broader value that these solutions can play in not only moving the business forward but moving it beyond the current economic crisis as well.

Indeed, CIOs should take a much closer look at SaaS solutions as a way to avoid significant up-front investments in new software platforms by simply “renting” on-demand applications that would provide added returns where most needed: the top…

With each passing day, the news seems to get worse – Chip makers faced a 29% drop in demand in January, PC makers are suffering, Dell continues to cut-back, Spansion files for Chapter 11.  Now what?

What on earth does one do to manage through times that seem to be impossibly difficult?  Where to start?

Our perspective is that the sooner or later the pain will end.  Even for chip makers, there is base demand for the technology that drives global living.  But, how does one predict when the patient will stop bleeding?  When  does the sales forecast inflect?  When does demand finally start matching potential supply – when does one stop cutting?

While it is impossible to predict the future, reducing latency in decision making through effective sales and operations planning (S&OP), creating a truly integrated business planning process by integrating financial planning with S&OP, and updating plans weekly if not daily is an imperative.

In the old work, the idea of listening to field sales and operationalizing that feedback into the integrated planning process was a luxury.  In today’s brave new world, it is mandatory.

Incorporating both qualitative and quantitative inputs into the planning process and carefully evaluating the early warning signals providing by oppotunity tracking and CRM tools such as Salesforce.com (SFDC) is now a survival skill.

Obtaining a wholistic view of the world by connecting historic buying patterns provided by ERP systems such as SAP  with current opportunity feedback provided by Salesforce, evaluating financial plans creating by planning tools such as SAP BPC or Oracle Hyperion with current state S&OP plans is fundamental.  The good news today is that a handful of companies have created software-as-a-service, pay-as-you-go offerings to support these planning processes.

Steelwedge software’s Executive S&OP offering is unique in so much as it enables companies…