Sale and Operations Planning
What is it?
S&OP is the verifying that the inventory consequences of the desired sales plan are achievable in both physical and financial terms and by the company’s logistic capability.
The consequences of poor or no Sales and Operations Planning are significant, with the double whammy of unrealised sales and excess stock. Poor process accountability can lead to wasteful meetings with logistics personnel trying to play salesman and vice versa.
The most significant impacts can be at the strategic level:
- Missed promotion periods – Stock not available to support sales aspirations
- Having insufficient funds to pay for sales aspirations
- Under prepared logistics – reacting to high work loads with last minute high cost
solutions and reduced service levels