Breaking Down Functional Silos with Sales and Operational Planning

Abstract

Title
Breaking down functional silos with Sales and Operational Planning: A case study at a Swedish grocery wholesaler
Authors
Tim Engrenius and Emma Rydén
Supervisor
Dag Näslund - Senior Lecturer at Division of Engineering Logistics, Faculty of Engineering at Lund University
Examinator
Jan Olhager - Professor at Division of Engineering Logistics, Faculty of Engineering at Lund University
Problem Description
Company X has recognized that a common framework for its sales and operations planning is lacking. Processes and tools for communication, collaboration, and plan alignment are not in place. This has been thought to cause increased workload, ad-hoc planning, reduced foresight, and the company has to handle issues reactively. They also believe key business targets have been negatively affected. Company X wants to study the vital parts needed for designing an S&OP process, further identify the improvement opportunities in their current processes, and set an agenda for how to improve their future sales and operations planning strategy.
Purpose
To craft a recommendation to Company X consisting of how an S&OP improvement can solve problems in their current cross-functional processes.
Research Questions
RQ1: What are the vital parts when designing an S&OP process?
RQ2: What problems can be identified in the company's current cross-functional processes?
RQ3: What S&OP improvements can solve the problems identified in RQ2?
Methodology
Single case study, Balanced research approach
Conclusion
The thesis concludes that Data Gathering, Demand Planning, Supply and Operation Plan, Management review, and evaluation are vital parts to have in consideration when designing an S&OP process. Eight problem areas have been identified at Company X. When ranked by employees, problems regarding “Cooperation, Understanding, and Information Sharing” have the highest priority. The thesis presents six recommendations for S&OP-derived improvements to solve the identified high-priority problems.
Contribution
This thesis has been a complete collaboration between the two
authors. Each author has been involved in every part of the process and contributed equally.
Keywords
Sales and Operation Planning, S&OP, S&OP Maturity Model, Strategy, Grocery Wholesaler

Popular Abstract

It all starts with balancing supply and demand. Now, try adding 70,000 grocery goods, over 200 new product introductions per year, and 3,000 plus employees. Where do you begin? What is vital to know? We have a suggestion.

Imagine being handed a treasure map, but instead of a clear path, it's an intricate spiderweb of directions, symbols, and cryptic notes. Trying to navigate one's surroundings using complex maps, models or frameworks can be daunting, even for large companies. Furthermore, if you have yet to identify your starting position, how can you strike gold using this map?

Just like that treasure map, the body of literature on sales and operations planning (S&OP) has developed into a difficult-to-use map of truly great ideas, dos and don'ts, and suggestions on where to look next. While some might be ready to dive head first and decode this very rewarding treasure that is S&OP, others might hear of it for the first time.

S&OP is a strategic business process that aligns an organization's sales and marketing plans with its supply chain operations. The primary goal is to ensure that the company can meet demand while securing inventory levels, and optimizing resource utilization.

So, what if you are a large grocery wholesaler that has lost your way following the S&OP treasure map? Could some initial clues on vital parts, steps, and expected output help you back on track? We certainly think so! Not only do we believe that this helps lost companies find their way, but we also think that it's the first step in reaping the vast benefits of a successful S&OP process.

Studies show that a successful S&OP process will improve cross-functional alignment and enhance process management. Therefore, S&OP can be used to identify problems in cross-functional processes and to draft a recommendation on how to solve them.

While hunting for S&OP treasury might sound like an exciting experience for your company, maybe you want to skip the part where you have to devour the smorgasbord of findings and insight in S&OP built over the last 20 years. Perhaps by following the trail and recommendations given to others, you will find a great understanding of where you are and your starting position.

• author: Rydén, Emma and Engrenius, Tim
• supervisor: Dag Näslund
• organization: Production Management; Engineering Logistics
• course: MTTM05 20241
• year: 2024
• type: H2 - Master's Degree (Two Years)
• subject: Technology and Engineering
• keywords: Sales and Operation Planning, S&OP, S&OP Maturity Model, Strategy, Grocery Wholesaler
• other publication id: 6028
• language: English
• id: 9168403
• date added to LUP: 2024-09-04 13:54:48
• date last changed: 2024-09-04 13:54:48