Last updated on November 29th, 2023 at 11:57 am
How Does Sales and Operations Planning Work in A Supply Chain
Meta Description: Benefits of sales and Operations planning in the supply chain. Know more about a career in supply chain and operations
What is sales and operations planning?
One of the most challenging aspects of a supply chain is sales and operations planning. However, it is also a crucial variable on which the success of a business depends. The main goal of the planning is to create a unified business plan. Those planning to have a career In Supply Chain and Operations need to learn it works.
The sales and operations planning gets inputs from teams like:
· Manufacturing
· Distribution
· Marketing and
· Finance
Businesses combine these inputs to simplify the process for stakeholders. It also helps them to create a support system for the same.
Need for sales and operations planning
The goal of sales and operations planning is to mix the components and activities of demand and supply. It should revolve around a consensus-based plan. Building consensus is easier with planning in place. If we don’t bring the team together under planning, it is impossible to make a successful design.
Thus, sales and operations planning provides a holistic view of every component. Then collective adjustments and inputs are made. This collaboration creates a resilient and shock-proof supply chain. Which, in turn, results in the success of a business.
Steps to create sales and operations planning
Generally, senior management works on sales and operations planning. Following are the steps in the process:
1. Forecasting
Data and trends are the major components of sales and operations planning. At first, data on the sales history is collected. During this stage, it is important to consider internal and external variables. These components affect sales like customers, competition and industry demands.
Then the data aids to forecast future sales. It helps to analyse and identify trends. It then builds the process in a supply chain based on the forecast.
2. Demand planning
Demand is a major factor that runs sales and operations planning in a supply chain. In this process, cross-collaboration is important. After the forecasting analysis, businesses adjust the inventory and customer service policy. The adjustments depend upon factors like demand and the source of the product.
According to the analysis of revenue and units, the businesses measure demands.
3. Supply planning
Another major aspect of sales and operations planning is sales planning. During this process, teams assess the capacity of the supply chain and products. The finance, operations and materials teams meet for the assessment. They determine the issues related to
· Manpower
· Machinery
· Suppliers and
· Distributors
During this process, the teams create a supply chain plan to check the limitations of capacity. They also work to come up with ways how to deal with the problems.
4. Pre-sales and operations planning
The first meeting of planning in the supply chain is crucial. Various teams take part in this process namely:
· Sales
· Finance
· Marketing
· Materials
· Operations
· Product management
· Human resources
The teams cooperate and compare the forecasting analysis of the demand and supply components. They also discuss the financial impact of both plans.
5. Executive sales and operations planning
The executives of teams meet to analyse the demand and supply plans. They also go through forecasts and recommendations. In the meeting, the executives approve the final sales and operations plan.
6. Finalization and implementation
After approval of the plan, the teams work on implementing it. Then, they assess the factors for implementation. It is important to assess the sales and operations planning regularly. It helps to find faults within the processes.
Benefits of sales and operations planning in supply chain
An integrated and collaborative sales and operations planning ensure:
· Increase in responsiveness
· Reduction in operating cost
· Increase in productivity
· Increase in revenue
· Increased transparency between departments
· Improvement in inventory management
· Creation of a resilient supply chain
· Demands of customers are met on time
· Improvement in budget and sales forecasting
· Improvement in decision-making about demand and supply
· Comprehensible understanding and management of a product at every stage
· Improvement in sales and customer experience
Challenges of sales and operations planning
· Understanding the complexity of the processes
· Choosing right sources
· Maintain transparency between departments
· Coordination between all stakeholders
· Scaling progress of a current process
· Lack of coordination while taking important decisions
· Usage of all data and analytics
Career In Supply Chain and Operations
For a career in supply chain and operations, you will need the best leadership program for supply chain professionals. Learners can choose from a wide variety of jobs like
· Client Management
· Consultative sales
· Program Management
· Consulting
· Supply chain operations
· Manager Technology
· Executive
· Manager Program Management
Why choose Imarticus Learning?
Imarticus Learning offers a certification program for Chief supply chain and operations officers. The program is offered in collaboration with IIM Raipur.
The 10-month-long program is offered in online mode. The 6-module program has benefits for the learners such as:
· C-suite training
· SCM Globe simulations
· Masterclasses by industry experts
· Campus immersion
· IIM Raipur alumni status
To know more about how you can have a Career in Supply Chain And Operations, click here.
