16 Nov 2023
1. Execution is where the plan is delivered.
S&OP or Integrated Business Planning is a waste of time if the plan is not executed effectively. In many companies we work with, we see the teams working on day-to-day operations struggling to keep up and deal with changes to plans driven by consumers, customers or internally. With little or no reconciliation of short-term replanning back to the plan signed off in the S&OP or IBP process, the difference between plan and actuals at the end of the month often comes as a surprise. This inevitably leads to a ‘Spanish Inquisition-style’ results meeting, where everyone is trying to explain the variation. A robust short-term planning and execution process should focus the weekly replanning process on delivering the monthly plan - if this can no longer be achieved then early warning should be provided to the leadership team.
2. Misalignment of functional plans costs money
Rework, waste, second guessing, poor customer service, delayed or sub-optimal product launches etc are all symptoms of lack of cross-functional integration of short-term plans. When plans change and re-planning occurs, having a robust process to check on functional alignment (and realigning where necessary) is key to effective alignment execution.
3. The short-term planning horizon (0-13 weeks) is where the stress is highest for your team.
Realigning the functional plans to take a whole-of-business response to near-term change reduces much of the stress associated with executional roles. It is far preferable to battling with colleagues in other departments who are changing their plans without understanding the impact on other functions. It also frees up time and energy to focus on improvement and proactive medium to long-term planning.
At Oliver Wight we have developed the Integrated Tactical Planning process to help organizations drive the functional alignment of daily and weekly changes in their product portfolio, demand or supply plans, and to drive the best customer outcomes, while re-optimising financial performance. ITP can be implemented and delivering results in just six weeks.
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