Supply Chain Blog

FMCG & Shakespeare? Macbeth S&OP Soliloquy

Posted by Dave Jordan on Mon, Apr 25, 2016

As we one again celebrate St George's Day and the 400th birthday of William Shakespeare (also the date he died, coincidentally) what would the great bard think about Sales & Operational Planning (S&OP) in FMCG businesses? Let us take a look......

S&OP ala Shakespeare

Is this a plan which I see before me, 
The numbers are as we planned? Come, let me see.
They are not, I see two numbers, still.
Art thou not following S&OP, incredible!
Your “gut feeling” could be right? or is this but
A plan of the sales mind, a false creation,
Proceeding from the bonus-obsessed brain?
I see this yet, inform others
As this which you cannot ignore.
Thou shall assure me S&OP gets going;
And the S&OP instrument I want used!
Mine eyes see the foolish lack o' consensus,
Or else worthless at best; I see this ill,
And on thy supply plan remove doubts of “could”,
Which was not so before. There's no such thing:
It is the demand plan which conforms
Thus to mine eyes. I must see minutes recorded
Pre-SOP must go ahead, and ERP is in use.
The gaps could be deep; discussion eliminates
Take extra offerings, and work even harder,
Align by this meeting, calm the sales wolf.
More minutes you attach, thus with stealthy pace
With colleagues at your sides, a single plan design
Move on to the Board. Ensure a firm-set plan,
Fear not our quips, the way we talk, no fear.
Some small adjustments we may talk about.
And take the present plan and deploy as,
This now suits the Board. S&OP is done, and leads
Towards defeat of those where S&OP lives not.

For fans of the man himself, here is the original William Shakespeare work.

Is this a dagger which I see before me,
The handle toward my hand? Come, let me clutch thee.
I have thee not, and yet I see thee still.
Art thou not, fatal vision, sensible
To feeling as to sight? or art thou but
A dagger of the mind, a false creation,
Proceeding from the heat-oppressed brain?
I see thee yet, in form as palpable
As this which now I draw.
Thou marshall'st me the way that I was going;
And such an instrument I was to use.
Mine eyes are made the fools o' the other senses,
Or else worth all the rest; I see thee still,
And on thy blade and dudgeon gouts of blood,
Which was not so before. There's no such thing:
It is the bloody business which informs
Thus to mine eyes. Now o'er the one halfworld
Nature seems dead, and wicked dreams abuse
The curtain'd sleep; witchcraft celebrates
Pale Hecate's offerings, and wither'd murder,
Alarum'd by his sentinel, the wolf,
Whose howl's his watch, thus with his stealthy pace.
With Tarquin's ravishing strides, towards his design
Moves like a ghost. Thou sure and firm-set earth,
Hear not my steps, which way they walk, for fear
Thy very stones prate of my whereabout,
And take the present horror from the time,
Which now suits with it. Whiles I threat, he lives:
Words to the heat of deeds too cold breath gives.

For a view of the lighter side of all things supply chain please click here.

 

Tags: FMCG, CEO, Humour, Performance Improvement, S&OP, Sales

FMCG Supply Chains; Swiss legal entities & local Op-Cos - a taxing question

Posted by Dave Jordan on Wed, Apr 13, 2016

Personal and corproate taxation has been top of mind this week. Suddenly all sorts of UK policticians are publishing their tax returns in an attempt to show themselves whiter than white. Well, the tax returns will be Persil-white won't they or otherwise the tax man will already have had a word?

In an attempt to divert attention from the personal evasion/avoidance debate the politicians have announced a fresh look at how corporates pay (or not) tax across each of the EU states and this could have significant implications.

In Europe and Asia at least, there is a fashion for creating a new supply chain legal entity and housing it in a friendly canton in Switzerland (or the Singaporean equivalent). The prime benefit appears to be tax although operational and efficiency savings are often claimed to offset the nasty sounding “tax avoidance” or "tax efficiency" motivation.

Certainly, you cannot just put your name above a B&Q shed, buy a Twonkie desk from IKEA, install a phone and employ an office–sitter and meet the undoubted Swiss tax benefit requirements.

You really do have to locate your operational supply chain organisation in the tax beneficial location. This means the relocation of potentially large numbers of departments, employees and their families which is a challenge in itself but how does such a change affect the actual operation of the regional supply chain?

In theory, the Swiss legal entity takes ownership for the sourcing, supply planning and making, partial delivery logistics and support service elements of the chain and the actual stock until a 3rd party sale takes place. The satellite operations essentially concentrate on demand planning, secondary/customer logistics and customer service from a local distribution centre. This sounds simple yet you still have to maintain one unbroken chain and frankly, customers do not see nor why shoudl they care about some far away alpine, chocolate box, snow-topped tax advantage.

FMCG_SUPPLY_CHAIN_EUROPE_TAX_.jpgThe local face to the customer will always enjoy the wrath of retailers when product is delayed or unavailable or of poor quality and that is irrespective of whatever corporate financial model is in place. The local people still have to take the blame for problems which may have occurred in a factory in a different hemisphere. However, the key is ensuring the entire chain really is one slick and seamless operation from start to finish AND all the players feel part of the same team. You must have shared objectives with KPIs and equal pain and gain in the wallet/purse at year end or failure is inevitable.

A centralised supply chain legal entity raises the importance of the local op-co S&OP working within a regional S&OP managed by the new, remote supply chain entity. Only one side working is simply not good enough. If you can generate a living team spirit in groups bound by shared objectives and integrated S&OP then you will have a regional supply chain working like the seamless movement of a quality timepiece rather than that of gloopy cheese dripping off a fondue fork.

Which one is most reminiscent of yours?

If the EU (+/- UK) gets tough on tax then we may be in for a fresh round of upheaval in blue chip supply chains.

Image courtesy of Sira Anamwong at freedigitalphotos.net