Sales & Operations Planning

Dick Ling gave a talk on Sales & Operations Planning at Tuesday evening’s meeting of the Atlanta chapter of the American Production and Inventory Control Society (APICS). Ling has been a manufacturing consultant since 1979 and was once associated with the Oliver Wight Companies. His book on Sales and Operations Planning launched the methodology into corporate America in the mid 80’s. I first met Ling in the early 90’s when S&OP was all about balancing supply and demand. But the world has changed and so too has S&OP. More and more businesses are becoming global and the need for product and service innovation is ever greater. So beyond just tracking widgets and managing demand and supply we are now aware of the need for integrating and rolling out New products and services.

Ling presented 3 Laws. CHANGE – change happens; so manage it PERSPECTIVE – it all depends on where you are coming from; so integrate and align the organization ENTROPY – over time systems (and organizations) become random, break down, morph; so put energy into counter this His 13 Principles for integrated decision making:

  1. The future will be different
  2. Effective planning is all about managing change
  3. Information needs to be prepared and presented for management decision making
  4. Better to be roughly right than precisely wrong
  5. Start with the end in mind
  6. S&OP connects & aligns strategy and tactics
  7. S&OP integrates and reconciles different views
  8. Business planning needs to be multi lingual (units and/or $, process families and/or market segments)
  9. Interdependency is the essence of integrated decision making
  10. Balance the Paradoxes
  11. Have a Framework and balance consistency and bureaucracy
  12. Learn-by-doing and regularly self assess
  13. New tools are important, but making change stick is about PEOPLE

Orchestrating Success: Improve Control of the Business with Sales & Operations Planning Sales & Operations Planning: The How-to Handbook, 2nd Edition