TABLE OF CONTENTS Most of this chapter focuses on planning technology, not on management of the planningprocesses. One of the key conceptual breakthroughs of the 1980s was the recognition thatenterprises needed a specific process to get the functional silos to talk to each other at the vicepresidential (more or less) level. Ling and Goddard s 1988 book [38] broughtattention to this area, and the Sales & Operations Planning (S&OP) process it introducedand named has become broadly accepted, if not always successfully implemented.
The core of the S&OP concept is that a business unit general manager and many of his orher direct reports (generally sales, manufacturing, marketing, engineering, finance, and perhapsprocurement and human resources) should meet approximately once each month to:
Review recent sales, production (or purchases if you are not a manufacturer), andinventory.
Review customer service issues.
Review updated aggregate operating plans for the short to intermediate horizon.
Make decisions that need to be made at this level of management and accepted across allfunctional departments. These decisions might be, for example, major changes in production ratebased on recent sales and revised forecasts, agreement that certain products may have to be shortedto provide capacity for other products that marketing and sales want to push harder, and so on. Themanagement team may also need to make decisions that should be resolved at a lower level, but forsome reason are too difficult or politically sensitive to have been resolved there.
To make the S&OP management meeting effective,...
