Is your IBP Lead role a wasted opportunity?

02 Apr 2024


Blog

I have encountered a recurring scenario in recent years: an Integrated Business Planning (IBP) process where the IBP Lead, typically part of the supply chain function, operates in relative isolation from senior leadership. This detachment is often driven by leadership viewing IBP as a mere background operation related to production planning and service delivery. This leaves the IBP Lead relegated to compiling monthly reports for management reviews, typically with little impact on decision-making.

Based on these observations, three common myths come to mind regarding the IBP lead role:

Myth 1: IBP is just advanced supply planning.

In fact, IBP has a much broader function. It encompasses the core processes and plans designed to address the fundamental business questions: 1. What products/services to offer? 2. How much to sell at what price? 3. How to supply them efficiently? These questions transcend the supply chain and involve all facets of the business. When properly implemented, IBP serves to align communication, activities, and plans across functions to ensure the business fulfills its future commitments.

Myth 2: The IBP Lead is a junior role that focuses on process development and a presentation once a month.

Contrary to this notion, the IBP Lead's primary responsibility is to align activities and plans across the business. They deal with real business issues that span functions, often tackling topics that function leads don’t want to because resourcing the issue from a functional perspective has little payback or upside. Therefore, the IBP Lead requires a skillset far beyond preparing PowerPoint presentations. They need to be adept negotiators with a drive to succeed and a focus on what is best for the whole business.

Myth 3: It doesn’t matter who the role answers to.

Actually, unless the IBP role has impartiality, the full benefits of the role can’t be realised. Maslow’s Hammer suggests that “if all you have is a hammer, everything looks like a nail”. Every function within the business has its own agenda. The motivation for the agenda could range from poorly created KPIs to plain old business politics. Often larger businesses have deeper set functional norms, making the need for an independent view more important. Functional biases can skew the perspective and advice provided by the IBP Lead role; therefore, the IBP Lead should not report into any specific function, so they can maintain impartiality.

Reflecting on a McKinsey article about excelling as a Chief of Staff (COS), I realized parallels between the attributes of a COS and those needed for an effective IBP Lead. Both roles are vital in ensuring the execution of the business's mission and providing an independent perspective free from functional biases.

The COS role is often associated with its beginnings in politics. The value of the role has since been realised by the business world and has grown dramatically over recent years. Simply stated, the role of the COS is there to ensure the leader of the business executes their mission.

The commonality that struck me most of all, and an opinion I have held for many years, was that if the IBP role is structured correctly, it is the ONLY role in the business, other than the business lead, that has an independent view of the issues within the business, free from the politics of functional agendas.

Why is that important? The McKinsey article confirmed a fact that a C-level leader once confessed to me directly, they said “…it is almost impossible to know what is really going on within the business. At this level everyone just tells you what they want you to know, and it is only ever the good things that they are doing.”

To succeed, the business lead, and arguably the whole leadership team need an independent view to provide the unvarnished truth, and only then can leadership work through the difficult problems together.

Beyond the similarities, there is one distinct advantage that an IBP Lead has over any COS role that I have encountered, and that’s IBP itself.

IBP is, in essence, a formalised structure of process and communication channels stretching across the business. It serves to align and continuously improve activities across functions. It also provides a monthly check-in on what is changing, how issues are evolving and a clear view on how the strategy is being executed. IBP is designed to drive the right decision-making, at the right time, by the right people. This results in the business avoiding the bureaucratic and convoluted process that can develop over time. I wonder how many COS would value the insights into a business’s operation that IBP provides.

Here are some keys to getting the most out of your IBP role:

 

Delivering these responsibilities takes a candidate with significant experience. So, ideal candidates for the IBP Lead role possess a blend of seniority, cross-functional communication skills, financial acumen, and strategic deployment abilities. By recognizing the IBP Lead as more than just a process facilitator and leveraging their insights, businesses can unlock their full potential for success.

While not every business has a Chief of Staff, every business running an IBP process has an opportunity to optimize the IBP Lead role. Instead of treating the role as a mere cog, treat it as a linchpin to overcoming the challenges within the business and a cornerstone to the business leader’s success.

For further news and views follow us on LinkedIn

 


Share buttons: email facebook linkedin twitter
© 2020 All rights reserved. Registered #3186. Website designed by RONIN Marketing