Oltikar Says:
|
Software
solutions are now enabling
next-generation SIOP,
driving value for the
‘Extended Enterprise.'
What
do you say? Send
us your comments here
|
The
complexity associated with managing
the value chain has grown to
a level previously unheard of
due to numerous macro and micro
factors including global demand
and supply, material price erosion,
increasing customer sophistication,
shorter product life-cycles,
and unexpected events.
Fragmented,
spreadsheet-based approaches
with fixed planning cycles are
incapable of responding to these
challenges. Sales Inventory
& Operations Planning (SIOP)
is a structured planning process
designed to gain consensus between
sales, finance, procurement,
manufacturing and logistics,
allowing them to efficiently
utilize assets, maintain high
levels of service and avoid
lost sales. Software solutions
are now enabling next-generation
SIOP, driving value for the
‘Extended Enterprise.'
Shortcomings
of Existing Planning Methodologies
For
many companies, a number of
shortcoming in current planning
methodologies and technologies
exist. These include:
- Confined
knowledge
- Sluggish
response times
- Inflexibility
to changing conditions
- Sub-optimal
business performance
Next-Generation
SIOP Process
Supply
chain leaders are moving to
new paradigms that embrace Sales,
Inventory and Operations Planning.
Key characteristics of the processes
of these leaders include:
- Multi-criteria
planning and multi-dimensional
analytics: Multi-criteria
planning, enabling a concurrent
focus on costs, assets, inventory,
service levels and financial
indicators are critical for
profitable growth.
- Cross-functional
and “Extended Enterprise”
synchronization: Traditionally,
and even today, functional
groups work in silos, leading
to the creation of sub-optimal
plans. Sharing information
creates visibility and provides
a clear understanding of how
different elements within
each area impact the performance
of others.
- Constant
review and proactive management:
Next-generation
SIOP is a continuous process
rather than a fixed planning
cycle. Changes in various
aspects of the value chain
drive the process, and proactive
management ‘what ifs’
search for problem areas before
they occur.
- Advanced
scenario planning and optimization:
Value
Chain disruptions or certain
triggers may throw an operating
plan off-track. In such cases,
scenario planning and advanced
optimization technologies
should be employed to determine
a set of new plans that best
meet the business objectives.
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