SFMF Roundtable
September 5-7, 2007

Sales Forecasting Management Forum--Executive Roundtable University of Tennessee (UTK) Executive Director Paul Dittman, Member Companies and Marketing & Logistics Department Professors
Tom Mentzer, Mark Moon,
Ken Kahn September 5-7, 2007 Knoxville Marriott
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Webcast: August 28, 2007 --
Best Practices Leadership Forum --New Approaches to Sales Forecasting
Dr. John T.( Tom) Mentzer, Bruce Chair of Excellence in Business, Department of Marketing, Logistics and Transportation,
University of Tennessee
Tuesday, August 28, 2007
10AM Pacific, 12 Noon Central,
1PM Eastern
Click to view event detail & enroll

Previous Webcast 7/31 --
Best Practices Leadership Forum -- Implementing a Collaborative Planning Forecasting and Replenishment Program
Ron Ireland, Principal,
Oliver Wight Consultants
Tuesday, July 31, 2007
10am Pacific, 1pm Eastern
10:00 AM - 11:00 AM PDT
View Recorded Webcast

Previous Webcast 6/26 --
Best Practices Leadership Forum -- Sales Opportunity Pipeline
—The Missing Link in S&OP?
Matt Merritt, GM and Founder of
MCG International,
and EJ Tavella, VP Solutions, Steelwedge Software, Inc.
Tuesday, June 26, 2007
10am Pacific, 1pm Eastern
10:00 AM - 11:00 AM PDT
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Previous Webcast 5/8 --
Best Practices Leadership Forum -- Sales and Operations Planning for Integrated Business Management
George Palmatier, Principal,
Oliver Wight Consultants
Tuesday, May 8, 2007
10am Pacific, 1pm Eastern
10:00 AM - 11:00 AM PDT
View Recorded Webcast

Previous Webcast 4/3 --
Best Practices Leadership Forum -- How to Extend SAP for effective Sales & Operations Planning (S&OP)
Tuesday, April 3, 2007
10am Pacific, 1pm Eastern
Mr. Padman Ramankutty, CEO, Intrigosys, LLC., former CEO and Founder, Bristlecone, Inc.
View Recorded Webcast

Previous Webcast 2/27 --
Best Practices Leadership Forum --S&OP Best Practices:
A Case Study
Tuesday, February 27, 2007
1pm Eastern, 12noon Central,
10am Pacific
Dr. Chris Gopal, Partner,
Deloitte Consulting and former VP Operations Strategy, Dell, Inc.
View Webcast Presentation

Steelwedge Momentum:
Three New S&OP Clients

Spansion, the largest company exclusively focused on Flash
memory solutions.

EDS, a leading global technology
services company delivering
business solutions to its clients.

Honeywell International Inc.
a diversified, technology and manufacturing company,
serving customers worldwide.

Industry Blogs
Here are the Industry Blogs that
we watch, and you might want to:

www.crmblog.org
www.supplychainer.com
www.andyonenterprisesoftware.com
www.siliconvalleywatcher.com
blogs.ittoolbox.com/crm
blogs.ittoolbox.com/supplychain
www.vics.org/blog

Sales and Operations Planning for Integrated Business Management

Recap of the Steelwedge Best Practices Leadership Forum Webcast,
May 8, 2007, featuring George Palmatier, Principal at Oliver Wight Consulting

Beginning with Production Planning back in the 70’s and 80’s we have seen a maturation and evolution of S&OP into integrated business management with supply chain collaboration at the present time. S&OP is about cross-functional integration across the business entity including—Demand (Marketing and Sales), Supply (Manufacturing, Materials, Logistics, Purchasing and Supply Chain), New Products (Research, Development and Engineering), Finance (Planning and Accounting) and Support (HR, Quality Assurance, Customer Service).

There are least 12 demonstrated symptoms of non-integrated, non-synchronized processes--missed customer deliveries, loss of credibility with customers, lost customers, higher manufacturing costs, excess overtime, premium transportation costs, low flexibility/responsiveness, higher working capital in inventories, late new product introductions, reduced financial performance, financial surprises and lack of strategic management.

Business integration means focus, alignment and engagement of people and behaviors, processes and tools throughout the organization.



Sales & Operations Planning is a formalized process led by senior management that, on a monthly basis, evaluates time-phased projections for New Products, Demand, Supply, Projects/Initiatives, and the resulting financials for the next 24 months. It is a decision-making to ensure that all business plans in all functions and geographies are aligned and in support of the company/division goals and strategies. The goal of S&OP is to reach consensus on a single operating plan which members of the executive team hold themselves accountable, and allocates critical resources to most effectively and profitably meet customers needs. A regular part of the process is the identification of gaps between current plans and goals…and development of action plans to close the gaps. Here are the guiding principles, keys to success and benefits of well executed S&OP:

Guiding Principles
Business Management Ownership
Speak The Truth
Rolling Monthly Planning
One set of operating numbers
Simplification -Focus on Changes

Keys to Success
Commitment and regular participation from executive staff
Common Goals across all participants

Benefits
Business Process Simplification
New Product Execution
Focus on the Customer
Planning vs. Firefighting
Revenue, Market Share, Margin,
Customer Service, Cash-flow

Peter F. Drucker once said, “Most companies don’t survive beyond 20 years—because they don’t deserve to.” Survival and prosperity is the result of meeting three management challenges: (1) Run the business effectively and efficiently; (2) Grow the business profitably; and (3) Make the business more competitive by improving capabilities. In a nutshell, integrated core management processes are-- managing demand, managing supply and managing products and activities.

A solid integrated management model seeks performance improvement through strategic management of people, values and knowledge. At the core is an S&OP process that includes four kinds of reviews; (1) Management Business; (2) Demand; (3) Supply; and (4) Product. Such a model looks like this:

Sales and Operations Planning is for every enterprise—large, mid-size and small.  From The Sales and Operations Planning Benchmark Report: Leveraging S&OP for Competitive Advantage by The Aberdeen Group:

     “Virtually all enterprises, irrespective of starting S&OP capabilities, size, and industry, generated improvement in key business performance with an S&OP program, sufficient to justify investment in these programs.”

And from the same report—.

     “…70% of the respondents to Aberdeen's survey are actively engaged in enhancing their S&OP processes...and enterprises that deploy S&OP programs strategically consistently outperform, by an average of 20% in % gross margin, those companies whose approach to S&OP is more tactical and less integrated.”

Here are the characteristics of an integrated business management S&OP process:

The good news is that most companies have most of the elements of sales and operations planning, but have not developed them into an integrated management process. To implement an effective S&OP process requires—understanding, design, tools and action to get results. The methodology should include—assessment and courses, workshops, aggregate S&OP tools and coaching support. And it will take some time to move through the four phases of implementation—improved communications, problem solving, problem prevention and tactical and strategic decision making.

Here's an example of how IBM integrates and operates S&OP:

Finally, here are management expectations from a well-executed S&OP process:

• Improved Information for Decision-Making
• Reliable Numbers –One Set of Numbers
• Ability to Measure
• Simulation Capability
• Contingency Plans
• Actions Support Tactics Support Strategies
• One Company Game Plan
• Refocus of Internal Competing Energy
• Improved Control and Predictability of the Business
• Improved Operational and Financial Results

About the Author:

George Palmatier is a principal with Oliver Wight Consulting and co-author of the book “Enterprise Sales and Operations Planning”. He has thorough knowledge of how to achieve sustained results improving business performance. He has written several books and white papers on strategic planning, demand management, the new leadership role of sales and marketing in manufacturing. Oliver Wight is a consulting firm of leading business improvement specialists who educate, coach and mentor people to lead and sustain change on the journey to business excellence.

For more information please visit www.oliverwight.com.