Supply Chain Blog

Top 6 Critical Success Factors of S&OP in Africa

Posted by Michael Thompson on Thu, Feb 17, 2011

I have been delighted by the response to my recent blog on the 11 critical success factors in Route to Market programmes.

One comment in particular has inspired this week’s blog.

It went along the lines of "we are about embark on an S&OP programme in Africa and want to understand if similar critical success factors apply."

The short answer is that some do & some don’t. 

Success factors of S&OP implementation in Africa

So here is the Top 6 Critical Success Factors to consider when implementing S&OP Programmes in Africa:

1. End Market (EM) Commitment & Ownership:

  • End Market Senior Management – all of them - need to be convinced.  Generally they are sceptical about such programmes that originate from HQ.  Time spent doing this properly is always time well spent.
  • The CEOs/GMs can make or break the programme; the success of S&OP is directly proportional to the commitment & ownership shown by the CEO.  It is not a supply chain programme.
  • Programmes need a ‘sell’, NOT a ‘tell’ approach.
  • End Market operational team engagement is always critical but will not happen if CEO buy-in is below 100%
  • The initial message from HQ will be very important in establishing realistic expectations.

2. S&OP Process Design (assuming a standard S&OP Design):

  • Standardisation – key is establishment of the ‘S&OP Template’ of key processes (e.g. SCOR Levels 1, 2 & some 3) with local End Market adaptation within ‘reasonable’ boundaries.  Keep the ‘rules’ robust and to a minimum.
  • Level 3 Design – use some End Market development as an opportunity to develop local ownership with local teams.
  • Keep it simple for Op Co execution.

3. People & Management of Change:

  • Most S&OP programmes involve significant change.  Ensure that as a minimum, the following are addressed in some way: 
  • Create a change management strategy - start with readiness assessments;
  • Engage senior managers as sponsors of the change;
  • Ensure communication develops a strong message and awareness of the need for change;
  • Involve people through the transition including by workshops in the design and implementation stages;
  • Ensure ample education & training to support the change;
  • Measurement & Reward - gauge progress (e.g. KPIs), reward appropriate behaviours (e.g. bonuses) and reinforce (e.g. award schemes) to sustain the change.
  • Avoid excessive delay (for any reason) – people will lose interest.
  • Above all, appoint a dedicated Change Manager.

4. People & Culture:

  • One size does not fit all in Africa & Middle East.
  • Any S&OP programme must be adapted to account for the local business culture.  Failure to do so will likely be disastrous – I have seen many examples.

5. Information Technology:

  • S&OP should not be an IT led project.
  • But the business & financial success of the programme is usually directly proportional to supporting ERP (e.g. SAP) effectiveness, planning tools, data capture and master data management.
  • Consider interim IT tools – these can work extremely well & maintain programme momentum before the full IT solution is implemented.

6. Measuring Performance & Managing for Success:

  • Decide programme outcomes in advance.
  • Decide what is not negotiable.
  • Be prepared to learn and adapt during the programme.
  • Use established Project Management methodology (e.g. Prince 2 – a ‘Lite’ version please) – plan, review etc.
  • Establish KPIs – consider a Balanced Scorecard.
  • Indicate the benefits early.
  • Build End Market success into CEO/GM/Board bonuses.

I have focussed on our experience from S&OP programmes in dozens of African countries.  Upon reflection, the above also apply in varying degrees to S&OP programmes in other parts of the world; I would welcome your views.

If you are wondering if you need S&OP in Africa, I wrote about this last year in an article - Doing business in Africa - 11 signs that your S&OP needs improvement.

And of course, if you need any advice, including on an informal basis, please just contact us.

PS

If you are interested in S&OP, you may also be interested in some other Enchange blogs:  Many are light hearted. 

Oscar Supply Chain Blog

Tagss: Michael Thompson, S&OP, Forecasting & Demand Planning, Doing Business in Africa