The People Part of S&OP: Part I

Lora Cecere is one smart supply chain expert.  She began her career as a supply chain professional with the companies like Clorox and P&G.  She worked at Manugistics developing supply chain software and then moved on to become a top notch supply chain analyst and thinker at the Gartner Group and AMR Research.  Currently she is the CEO of a Supply Chain Insights and the author of the best supply blog there is:  Supply Chain Shaman.   (Don't get us wrong, we are proud of our blog but we Supply Chain Shaman is the standard against which we measure ourselves.)

In May of this year, Supply Chain Insights published the results of a survey of over 100 supply chain executives.  The report is Sales and Operations Planning Improves Supply Chain Agility.  It is well worth readng the report which is in PowerPoint format.

We have been blogging about ERP and Excel of late, you might think that software is at the top of our mind as far as S&OP goes.  That is not the case.  We will shift gears in this blog and address what we call the People Part of S&OP.  The gist of what we mean in this regard is nicely summed up in the above mentioned survey.  When looking at "the largest Sales and Operations Planning Challenges." the Supply Insight Survey reported the following:

• Understanding and support by the executive team (39%)
• Clarity of supply chain strategy and supply chain excellence (29%)
• Technologies that support the process (18%)
• The role of finance and the budget (11%)
• Availability of skilled resources (4%)

Software is number three on the list!  Of these five challenges, four out of the five are people or organizational issues.  This has been our point and a focus of our consulting work.  

S&OP is easy to implement i.e. get going.  Lots of companies have implemented it.  There are books with the process clearly laid out.  Follow their directions and you can launch an S&OP process.  The hard work, the challenge, comes after the launch.  How does an organization make it work?  How does an organization make it work well and become a world class process that makes a supply chain more agile than it ever was before?

In our work, we tell our clients that the #1 factor is the leadership and support of the executive team.  For us, while we saw no new news in the above challenges, we were delighted to have data and another anchor point to show our clients.  If there is no support from the top, there is little chance that S&OP will succeed.   S&OP is a cross-functional planning and resource allocation  process.  Without top management support and insistance that it deliver results, people will slowly stop participating and S&OP will die a slow death fading slowing into the vast store house of "yean, we tired that once, it didn't work."  The best software in the world will not help here.

Software is an accelerator.  When an S&OP process is well designed and well supported by the executive team, software will make it run better.  People will appreciate the software because it will save them time and organize the data and decisions.  

Do you agree?  We would love to hear your views.