Business Forecasting 2015 S&OP Framework

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S&OP Framework

Aligning Sales and Operations Functions to Ensure that Customer Needs are Met

Anthony Reese

Partner and Co-Founder

Integrated Business Planning Associates

Business Forecast and Strategic Innovation 2015

February 17th, 2015

Speaker Background

Anthony Reese CPF CPIM SCOR-P

Is the co-founder of Integrated Business Planning

Associates and is a visionary leader with passion for

bringing exciting products to market. His early interest in

cars led to his first job as an auto mechanic and then into

an impressive career in the automotive / motorcycle

industry. Along the way, Tony earned two advanced

degrees from MIT and now brings in-depth knowledge of

Product Lifecycle Management, Demand Planning and

Operations Planning to clients wanting to implement Sales

and Operations Planning processes and its current best

practice form, Integrated Business Planning.

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Integrated Business Planning Associates

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Sales & Operations Planning

Demand Forecasting & Planning

Integrated Business Planning

Advanced Planning & Scheduling

We take time to understand your business and specific objectives for your planning processes… then

we apply a balanced, comprehensive methodology, addressing people-process-technology success

factors, with a careful focus on change management.

With a successful track record across industries, you can rely on our experienced and professional

resources to approach every engagement with a lasting commitment to your success.

Developing processes that fit your business…

Deliver cross-functional value…

With a financial and strategic focus…

Leading to improved bottom-line results.

Process Evaluation

Technology Selection

Business Process Design

Solution Architecture

Process Facilitation

Change Management

IBP2…the power of planning

The IBP2 Key

Success Factor Model

S&OP

People

Process

ToolsData

CultureChange

Management

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The IBP2 Key

Success Factor Model

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Why do we need a defined

Planning Horizon?

Support Long Supply Chains

– Time to source, produce and delivery

Support Instantaneous Demand

Support Effective Business Planning

– Understand where we are

– Clarity about our goals

– Time to develop and execute plans to attain our goals

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What is the right planning

horizon and cadence?

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18 Months

1Month

One very effective practice is to

create an 18 month planning

horizon…

with and S&OP process that

runs monthly

So why 18 Months?

An 18 Month Planning Horizon

– Gets out in front of annual business planning

• Aligning to one plan early

• Simplifying the annual business planning process

– Allows time for business planning & execution

• Enabling effective leadership

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Execution Tactical

0-3 months 4-12 months 12-18 months

Strategic

Applying Three Inputs: Bottom-Up

Forecasts, Plus Top-Down Plans, and

Goals & Objectives

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and why S&OP Monthly?

Running S&OP monthly

– Frequent enough to support core business

cycles

• Creating a regular practice and expectations

– Frequent enough to support strategic focus

• Engaging leadership at the right strategic levels

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Consensus Planning Horizon &

Cadence Simulation Exercise

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Consensus Planning Horizon &

Cadence Simulation Exercise

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Bottom Up Only Bottom Up + Top Down

Bottom Up + Top Down + Goals/Gap Closers to Meet Business Objectives

Financial PlanFinancial Plan Financial Plan

Financial Plan Financial Plan Financial Plan Financial Plan Financial Plan

Financial Plan Financial PlanFinancial Plan Financial Plan Financial Plan Financial Plan

Financial Plan Financial PlanFinancial Plan

Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up

Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom UpBottom Up

Top DownTop Down

Top DownTop Down

Top Down Top Down

Top DownTop DownTop DownTop Down

Top DownTop Down

Top DownTop DownTop Down

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Bottom Up Only Bottom Up + Top Down

Bottom Up + Top Down + Goals/Gap Closers to Meet Business Objectives

Financial Plan Financial PlanFinancial Plan Financial Plan Financial Plan Financial Plan Financial Plan

Financial Plan Financial PlanFinancial Plan Financial Plan Financial Plan Financial Plan

Financial Plan Financial PlanFinancial Plan

Financial Plan

Consensus Planning Horizon &

Cadence Simulation Exercise

Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up

Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom UpBottom Up

Top DownTop Down

Top DownTop Down

Top Down Top Down

Top DownTop Down

Top DownTop DownTop DownGoal

Goal

Goal GoalGoal Goal

GoalGoal Goal

Gap

Gap

Actuals

Gap

Consensus Planning Horizon &

Cadence Simulation Exercise

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Bottom Up Only Bottom Up + Top Down

Bottom Up + Top Down + Goals/Gap Closers to Meet Business ObjectivesBottom Up + Top Down

Financial PlanFinancial Plan

Financial Plan Financial Plan Financial Plan Financial Plan Financial Plan

Financial Plan Financial PlanFinancial Plan Financial Plan Financial Plan Financial Plan

Financial Plan Financial PlanFinancial Plan

Financial Plan Financial PlanBottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up

Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom Up Bottom UpBottom Up

Top DownTop Down

Top DownTop Down Top Down

Top DownTop Down

Top DownTop DownTop DownGoal

Goal

Goal GoalGoal Goal

Goal

Gap

Actuals

Gap

GoalGoal

ActualsActuals Bottom Up

Gap

Bottom Up

Questions

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Connect With Me

Anthony Reese, San Jose, California

[email protected]

@ibp2dotcom

www.linkedin.com/in/avreese

831-708-8020

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