Copyright Integrated Business Planning Associates, LLC 1 S&OP Framework & Case Study Aligning sales and operations functions to ensure customer needs are met San Francisco, California, USA October 17th, 2013 &
S&OP Framework and Case Study (PlayStation)
Nov 18, 2014
S&OP Framework and Case Study (PlayStation)
Presented at the Business Forecasting 2013 Predictive Intelligence Summit. San Francisco October 17-18th 2013.
Presented at the Business Forecasting 2013 Predictive Intelligence Summit. San Francisco October 17-18th 2013.
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Copyright Integrated Business Planning Associates, LLC1
S&OP Framework & Case StudyAligning sales and operations functions to ensure customer needs are met
San Francisco, California, USAOctober 17th, 2013
&
Copyright Integrated Business Planning Associates, LLC
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.
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
Copyright Integrated Business Planning Associates, LLC
Speakers
Tony Reese Partner Integrated Business
Planning Associates (IBP2)
Background in Operations Management (Harley-Davidson, BMW, Plantronics). Joined IBP2 in 2010.
Now – S&OP Process Coach
Bob Wood Director of Sales and Operational
Planning at Sony Computer Entertainment America (SCEA)
Background in Retail (Macy’s, Target). Joined SCEA in 1999. Moved up the ranks through Sales Planning.
Now – S&OP Rockstar.
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Copyright Integrated Business Planning Associates, LLC
NEXT GENERATION SALES & OPERATIONS PLANNING
Integrated Business Planning Associates
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S&OP is simple in concept but can be complex in practice, especially in a deeply integrated application
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Demand Review Operations Review Business Review
Pre-S&OP
S&OP / Management
Review
Issues & Analysis
Consensus Demand Planning
Operations Planning
Business Planning
Key Customer(s): SVP Sales & Marketing
Stakeholders: Operations, Finance
Key Customer: SVP Operations
Stakeholders: Sales, Marketing, Finance
Key Customer: CEO
Stakeholders: Executive Team
Stat Forecasts
New Products
Commercial Plans
Inventory
Production
Warehouse & TransportationNew Markets
Copyright Integrated Business Planning Associates, LLC
But the same time-tested S&OP sub-process steps still apply, even in today’s “next-generation” implementations
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Issues Managed by Exception
S&OPPre-S&OP
Operations Review
DemandReview
Demand Planning
SupplyPlanning
The process is driven by exception and focuses on decision making.
S&OP is a cyclical process, with each cycle feeding assumptions and information to the next
Demand Review Operations Review Business Review
Consensus Demand Planning
Operations Planning
Business Planning
Simple by design…But process deals with complex integrations and interactions across the global enterprise.
Consensus Demand Planning
Business Planning
Demand Review Operations Review Business Review
Markets (Global)
Portfolios (US)
Regional DemandReview (US)
Regional DemandReview (LATAM) Global
Product Supply
Planning
Supply Planning
Ops ReviewsUS
S&OPUS
Pre-S&OP
LATAMS&OP
LATAMPre-S&OP
EMEAS&OP
EMEAPre-S&OP
APACS&OP
APACPre-S&OP
ES&OP
Markets (Global)
Regional DemandReview (EMEA)
Markets (Global)
Regional DemandReview (APAC)
Operations Planning
7 Copyright Integrated Business Planning Associates, LLC
S&OP supporting applications will drive process efficiency, scalability and data integrity
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• S&OP Functionality Data analysis by product and customer
Collaborative demand planning Constraint modeling Financial modeling
Capture assumptions Scenario modeling Work flow / process facilitation
• Expanded Capabilities* Statistical forecasting (Demand
Forecasting Tool) Capacity/sourcing models Account planning* - Available on some leading applications
Transactional LayerTransactional Layer
FP&AFP&A
S&OP ApplicationCollaboration * Consensus * Analysis * Review
S&OP ApplicationCollaboration * Consensus * Analysis * Review
BIBICRMCRMAPSAPS
Workflow Reporting
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Bottom Up Demand Forecast
Bottom-Up Forecasts Plus Top-Down Plans & Objectives in a Common Data Structure
Execution Tactical
Top Down Plans
Objective Assigned
0-3 months 4-12 months 12-18 months
Total Consensus Demand
Gap to Budget…
Risks Associated with LBE “Tasks” if they are not “operationalized” as part of the S&OP process
• Results in service issues if added to the plan w/o evaluating supply capacity
• Results in excess inventory if commercial plans are not fully evaluated / delivered
• Leads to sub -optimized and disconnected actions vs. “one common plan”
Execution-able plans only
Strategic
Copyright Integrated Business Planning Associates, LLC
GREATNESS AWAITSPlay Greatness Awaits Video – http://youtu.be/Czx65TWQA94
Company Overview
Sony Computer Entertainment America: Division of Sony Corporation established in 1994.
Responsible for PlayStation brand in United States, Canada, and Latin America for PS2, PS3, PSVita, and PS4.
Tough planning cycle with long lead times on Hardware.
PS3 PS2 PSN PS Vita
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Implementing S&OP: Case Study (SCEA)
Initial Consultation
H1 2010
Education and Initial Assessment
S&OP Roadmap
Foundational Capabilities
H2 2010
Build Foundation Capabilities
Consolidated Item Master
NPI Milestone Review
Detailed Design
H1 2011
S&OP Design
S&OP Process Defined
S&OP Calendar Established
Pilot
H2 2011
Pilot S&OP and Select Technology
Pilot S&OP Meetings
Tool Selection and Implementation
12 Copyright Integrated Business Planning Associates, LLC
Full S&OP
H1 2012
Full S&OP Implemented
Full Senior Exec Team & CEO included in Exec
S&OP
Financial Integration
H2 2012
S&OP Business & Scope Expansion
Financial Integration Established
Telescopic Calendar
Innovation Pipeline
H1 2013
S&OP Process Expansion
Innovation Pipeline Review
Demand Sensing
H2 2013
S&OP Process Improvement
Improved Demand Sensing
Implementing S&OP: Case Study (SCEA)
13 Copyright Integrated Business Planning Associates, LLC
Performing Advanced Demand Signal Analysis
Details captured at the Store Level for top accounts
– 25,392 stores captured.
Store level analysis
– Store level analysis to replenish for inventory out of stocks.
Detailed Trends
– Regional trending based on store location among multiple retailers (210 Demographic Market Area regions).
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Improving the Demand Signal with Retail Signal
Before Slow, manual sell thru data collection
process
– 13 EDI feeds
– 30 Multiple format CSV files submitted via e-mail
Data clean up and collection
– Process took 40+ hours to clean up a week
Process built on Access Database
– Highly technical and not user-friendly
Publish Weekly Sell Thru report on Fridays
– Was only source of Retailer Sell Thru and Inventory
After Retail Signal monitors data loads
– Sell Thru data adaptors to handle any format provided from retailer.
– Around the clock coverage and
service. Weekly Sell Thru report now
published on Tuesdays
– Overall process is now 4 hours.
Cloud based analytical tool available to wider audience
– Intuitive UI and more user-friendly
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Improving S&OP Performance
Demand Signal
Forecast Process
Allocation & Supply Planning
Better Demand Signal
Drives Forecast Accuracy
Improves Supply Planning and Allocation
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WRAP UPIntegrated Business Planning Associates
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It is important to take a comprehensive approach to your business and S&OP process assessment
People
Process
Technology
Data Structure & Content
Culture & Change Management
Copyright Integrated Business Planning Associates, LLC18
The IBP2 Key Success Factor Model
And then go deeper…Critical links between People ~ Process ~ Technology
Copyright Integrated Business Planning Associates, LLC19
The critical links…
– The roles and responsibilities linking People & Process
• Are they clearly defined and is the organization aligned?
– The methodology & approaches linking Process with Technology
• Do approaches fit the business and organizational model?
– The configuration & user interface linking People and Technology
• Do the systems work for people? (or do people work for systems?)
After both running & implementing successful S&OP efforts we have learned some lessons.
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Keys to Successful S&OP Apply simplifying concepts to the complexity Ensure alignment/synchronization with master data Incorporate cross-functional data structures and hierarchies Integrate with finance to drive fastest adoption Position the S&OP process as a decision making process Link S&OP cycle to the established business review process Establish well defined process facilitation / workflow steps Inputs should be specific, tangible and actionable Support the process with the right technology Focus on change management
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Contact Information
Bob Wood
Tony Reese
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