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Route to Market & Supply Chain Blog

Top 10 Tips to Effective IT Enablers in S&OP

Posted by Dave Jordan on Tue, Sep 21, 2021

The Enchange Supply Chain House; the one-stop shop for all the elements you need to achieve supply chain excellence.

In successful FMCG companies, Sales & Operational Planning (S&OP) is the flexible glue that holds your processes together, ensuring demand and supply are balanced along the chain and most importantly, sees everyone operate to the same set of unambiguous sales, volume and financial numbers.

In the last article we looked at the Top 10 Tips for efficient behaviours in S&OP. This article looks at the IT related enablers required to make your S&OP deployment a resounding success.

1. Data, Information & Actions. Do the participants and particularly the decision makers, understand the difference between data and information? Is your raw data transformed into understandable information and then into clearly defined actions?

fmcg-it-enablers-in-post2. Master Data. Does every single item used or moved along the supply chain have a unique master data file? Is there a Master Data Manager or similarly dedicated resource to manage the creation, validity and adjustment of master data?

3. S&OP IT & Master Data, KPI Management Policy. Is there a concise, written IT data management policy to support S&OP that covers the purpose, process and participants? Is this endorsed by the senior team and updated periodically?

4. Master Data & KPI Process & Procedures. Is the Master Data Management process clearly understood by all participants and the senior team? Are all roles and responsibilities well defined and processes and authority levels strictly adhered to? Is there a high level of confidence in the quality of data used by the organisation? Are KPIs clearly defined, measured correctly, continuously monitored and reviewed?

5. Information Collation. Is there a system in place to collect and review past performance and future plans for sales, production, inventory, backlog, shipments and new product development? Do the alerts or exceptions from IT planning systems (ERP) form the basis for discussions in S&OP meetings?

6. Information Dissemination. Are there standardised, formal systems in place to share and communicate data and information quickly between participants? Is information from key suppliers, distributors and customers (retailers/wholesalers) obtained as a timely input to the meetings?

7. Production/Sourcing Planning Tool. Is there an appropriate production planning/finished goods sourcing tool that allows scenario planning by individual SKU? Do participants understand how this preparatory work enables easier and faster decision making in the meetings?

8. S&OP Governance. Is the S&OP process monitored through adherence to the S&OP cycle, participant attendance and meeting minutes/actions plans? Is the process audited at least annually and preferably by an external expert?

9. Management Reporting Tool. Is there an integrated management reporting tool that encompasses top-to-bottom Key Performance Indicators providing visibility of business process and departmental performance?

10. Key Performance Indicators

  1. Financial KPIs. Do these include some or all of the following: Asset Utilisation, ROI, Operations Profit, Brand Profit Contribution, Operating Cash Flow, SKU Profitability, Write-offs (potential) and Operations Capex?
  2. Operational KPIs. Do these include some or all of the following: Forecast Accuracy, Manufacturing Cost, Supply Chain Cost, Capacity Utilisation, Quality, Lead-times and New Product Development measures (including NPD lead-time)? 
  3. Service KPIs. Do these include some or all of the following: Supplier OTIF, Order OTIF (often a client-defined measure, not internal), Conformance to Plan, adherence to SLAs, Speed to Market and Volume Growth?

Are all KPIs measured routinely, accurately and honestly? Is the performance bar raised as sustained improvement is achieved?

A fully functioning S&OP process with empowered and motivated participants will provide your company with a distinct advantage in the market place. How much of an advantage depends on how well you implement this series of Top 10 Tips.

Read more articles on Supply Chain Excellence and Route To Market on our website where you can also subscribe to our frequent updates.

Finally, feel free to use any of our contact routes including Live Chat, if you have any questions about how the Enchange Supply Chain House can assist your journey to supply chain excellence.


Tags: FMCG, KPI, S&OP, IT, Supply Chain House, supply chain excellence

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