When it comes to implementing an effective S&OP process, do we need a hard-driving commander or a consensus driven committee?  After all, S&OP is about collaboration, right?  Well, yes and no.  An S&OP process must be collaborative.  But the implementation need not be heavily committee-based.

The Tony award winning musical Memphis includes a song titled “Change Don’t Come Easy”.  Oh how true that is.  In social norms and in business, change can be slow and painful.  So what’s a successful recipe for S&OP change?  Although every enterprise has its own unique characteristics that will influence its approach, here are five observations we see when assisting clients to employ best practice S&OP processes and tools.

Top Management Support: Do your senior executives know what S&OP is?  Do they understand the value of S&OP?  How committed are they to making S&OP truly ingrained in the culture of your organization?  When S&OP implementations fail, often the root cause can be traced back to a lack of senior leadership.  At all levels of the organization, it must be clear that the whole organization is committed to making necessary changes.

Company Goals Above Individual or Department Goals: What’s the goal of S&OP?  It should be to drive strategic business decisions that benefit the entire company NOT one employee or department.  Too often personal goals conflict with the greater good.  Strive to minimize such incentives that detract from the overall goals.

Make Decisions and Keep Moving Forward: Cross functional representation is required to get buy-in from all business disciplines.  One person will not implement S&OP on her own.  Assemble a group of knowledgeable doers who have the company’s interests at heart and know their functional area well.  When this group reaches an impasse, a single S&OP sponsor/leader should step in and make key decisions. …

Those following Supply Chain Industry Analyst Lora Cecere’s new Supply Chain Shaman blog (http://www.supplychainshaman.com) have read with keen interest her observations about SAP’s progress in the area of Supply Chain Planning.  Lora points out that while  SAP has made tremendous progress in many areas it is also struggling with integrating its many components – specifically Lora says that the “integration of business intelligence and performance management is moving [too] slowly.”    Her notes on the growing disappointment with SAP APO – from within and outside the SAP organization – are also worth noting (http://www.supplychainshaman.com/2010/04/inside-insider:

“I leave the event with two major disappointments.  The first is that the integration of business intelligence and performance management is moving slowly. …too slowly for this curmudgeon analyst.  I was hoping to see the results of the Teradata/SAP Business Objects integration and the launch of a new generation of predictive analytics.  While there is some progress in Performance Management, it is largely traditional reporting/dashboards.

The second is that SAP APO—SAP’s supply chain planning suite—was  largely business as usual. At the event, I saw small, incremental changes, but no major innovation like I saw in MII, PLM and transportation management.  I keep crossing my fingers. I would love to see  SAP have the courage to blow up APO and start again.  Who knows if it works for PLM, maybe there is a chance to bring innovation to a solution — and the larger Supply Chain Planning (SCP) market– that sorely needs to be redefined.”

As SAP friends and partners know, SAP has some truly outstanding employees and the SCM Product Group continues under the brilliant leadership of Lori Mitchell-Keller.  Yet, overcoming legacy products and dated, mis-guided inertia is difficult for even the most effective of executives.  The great news is that a whole new generation of cloud-based supply chain planning…

Implementing an effective S&OP process requires effective management of personnel, systems, and process issues. Of these three areas, the change management aspects of personnel issues are often the most challenging. Organizational change strategies fail most frequently due to the inability of management to lead their teams through the transition process. Are supply planners and demand planners communicating? Is sales operations providing timely input? Are issues being resolved in a timely manner? How will disagreements be resolved?

As a corporate process, S&OP requires strong leadership and a keen understanding of change management.

Understand Change

There are two elements to organizational change: Personal transitions and Organizational transitions.

An old paradigm in change management was that it was only the organizational that was going through the change, de-emphasizing the personal aspect. But an organization is made up of a triad of people, process and technology. We understand that the only part of that triad that might have resistance to change is the personal. As a result, an organizational change strategy must focus not only on organizational transitions; it must also focus on personal transitions. From a leadership perspective, this means proactively understanding the affect on various stakeholders and leaders, for example looking at:

• Who in the organization is going to gain and lose power – S&OP team? Supply team? Demand Team? Sales. Has a fully powered S&OP team been created?
• Who in the organization might experience a positive or a negative careers move
• Who might be exposed when the changes show how poorly things were done in the past
• Who has the most to risk by making these changing and why

In order to understand, from each of their perspectives the perceived risk, time should be spent conducting interviews as well as a leader and…

As Tiger Woods slowly 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.…