Perspectives on Sales & Operations Planning

Why is Scenario Planning a Necessity in Today’s Environment?

In today’s highly volatile economic environment, corporate Scenario Planning is more necessary than ever before.  Why is this the case?  Rapid changes in the consumer landscape, gyrating commodities prices, unpredictable capital costs -  even climate change  – mean that executives must be prepared for every possible contingency.   In short – executives must be ready with Plan A, B and C.  While it is no longer possible to predict which plan is most likely to be executed, it is possible to identify the range of possibilities and develop contingent plans accordingly.

Case in point comes from the July 6, 2009 Wall Street Journal article (http://online.wsj.com/article/SB124683295589397615.html) by Cari Tuna which provides an overview of the key plan options presented at JDSU and the likely impacts of each plan:

“Each spring, executives at JDS Uniphase Corp. plan for three potential sales scenarios for the coming fiscal year, which begins in July. Last year, rattled by financial-market turmoil, they included an extremely pessimistic sales outlook and outlined potential cost cuts….The experience highlights the value of scenario planning, or preparing responses to imagined changes in conditions.

“It’s not about predicting the future,” says Peter Schwartz, a partner at Monitor Group, a Cambridge, Mass., consulting firm. “Scenario planning is a tool for learning” and making better decisions.”

Steelwedge is proud of its role as the acknowledged leading provider of software-as-aservice solutions to enable complex scenario planning.  The Steelwedge Sales and Operations Planning (S&OP) is unique in its power, flexiblity, and low cost.  Its ability to model top-down, middle-out, bottom up price, cost, demand and supply changes is at the center of this approach.

Sphere: Related Content