What’s the key success factor in S&OP?
How do you ensure your process is truly effective?
In this video, we dive into what makes S&OP work and share insights to help you improve. Watch now and discover the answers.
Why the MD is Crucial for Sales & Operation Planning (S&OP)
When it comes to Sales & Operation Planning (S&OP), there’s one factor that stands out above all others: the involvement of the Managing Director (MD). While many focus on processes, systems, and data, the MD’s active participation is what truly drives success. Without a committed MD, even the best S&OP processes can fall flat and fail to deliver the results businesses need.
The MD’s Leadership Makes a Difference
The MD holds a unique position in the organization. Unlike other executives, the MD has the authority to influence all parts of the business. This authority is essential for S&OP to succeed. Supply chain teams may drive the data and analysis, but they don’t have the power to enforce decisions across departments like sales or customer service. This is where the MD steps in. Their involvement ensures that everyone is aligned and moving in the same direction. Without it, S&OP can quickly lose momentum and fail to reach its potential.
Sustaining the S&OP Process
S&OP, like anything, requires effort to stay effective. Without consistent input from the MD, it’s easy for the process to lose focus and energy. This is where the second law of thermodynamics comes into play: without energy, things naturally degrade. The MD’s job isn’t to spend hours every week in S&OP meetings, but they need to ensure the process stays a priority. Their leadership helps keep S&OP fresh and relevant, ensuring that it remains a key tool for strategic decision-making.
The MD Owns the Process
At its core, S&OP is about making decisions that guide the future of the business. And these decisions need to be owned by the MD. Without this clear ownership, S&OP becomes just another set of meetings. The MD’s leadership is what gives S&OP its authority and ensures that the entire business takes it seriously.
In the end, the success of S&OP is about more than just data or processes. It’s about having the MD fully committed to the process. When the MD is engaged, S&OP can drive meaningful change and deliver real business result
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Editor’s Note: The content of this post was originally published on Logistics Bureau’s website dated February 22, 2023, under the title “ Sales & Operations Planning (S&OP) – The Greatest Success Factor“.
