Demand planning is a crucial process which allows businesses to predict the demands for products or service and manage their operations and supply chain accordingly.
With effective sales and operations planning (S&OP), organisations can better align supply with demand, reducing wastage, improving cost efficiencies and enhancing customer satisfaction. At Vendigital, we bring together our clients’ sales and operations teams to analyse workflows and projections, optimising business-wide activity to satisfy demand efficiently. Leveraging data from other relevant departments, such as marketing, procurement, finance and manufacturing, we ensure any decisions are data-backed to support achievement of your company’s goals. With our consulting expertise, we support our clients in analysing the current challenges identified in the S&OP process and help them develop strategies for change such as entering new markets, onboarding new suppliers and adopting new products or services.
There are four key areas that we review as part of our approach to S&OP. These are the product, demand, supply and finance. Once data is collected from these reviews, we work with organisation leaders to analyse the information and develop strategies for the optimal way forward that achieves maximum return on investment for the business.
The review of the product, whether current or new, involves considering its development, the necessary workflows and supply chains and how it is received by the market. We also evaluate the timelines of each phase of production and how resources are prioritised. If new products are planned to be introduced, we consider how these will impact existing ones.
The review of demand takes a comprehensive approach, evaluating independent demand (for the finished product) and dependent demand (for its components). Demand can be influenced by factors such as sales and marketing activity, market trends, the introduction of new products and product hierarchy. Data from each of these influencing factors can then inform forecasting and planning.
The review of supply capacity and production aims to understand what’s needed to match the demand forecasting information, and the supply chain’s flexibility and resilience to change. Using our consulting experience and proprietary digital platform, we can predict supply agility against different circumstances. With this understanding, we then support our clients in reducing risk and waste while optimising return on investment.
The finance review is a vital aspect needed for delivering inputs for S&OP. Financial performance is evaluated, comparing costs to budgets and considering areas such as product categories, geography, channel and customer to determine the accuracy of future forecasts.
This phase brings together all information and learnings from the product, demand, supply and finance reviews. Working with designated leaders in the organisation, we analyse how these reviews align, identifying gaps or disparities and creating strategies for negotiating these challenges and the potential financial or operational implications of any change.
With the data, analysis and strategies obtained in the first five phases, we ensure that S&OP is ready to be implemented by working with key decision makers to confirm the action on plans made, exploring any risks and their predicted implications, and putting in place timelines. In this phase, S&OP should be agreed upon across all relevant departments and then implemented through the appropriate channels.
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The benefits of best practice
Our consultants have in-depth experience in carrying out S&OP across a wide range of industries, understanding what information is required to ensure the best outcomes for each specific organisation. Our effective and regular S&OP can provide numerous business-wide benefits, including reduced costs, boosted revenue and increased customer satisfaction.
Using our proprietary digital platform and consulting expertise, we support our clients with accurate demand forecasting and a better understanding of how their supply chain and operational activity can align efficiently. Implementing these proven S&OP processes, we help our clients cut inventory costs, thus improving their cash availability.
In reviewing market needs and gaining an understanding of the successful introduction of new products or entry into new markets, effective S&OP boosts revenues, increases market share and supports business growth.
Providing an understanding of customer demand, S&OP supports our clients in creating valuable products for their market. Meeting their customer demand improves satisfaction levels, increases sales and loyalty, and promotes better overall profitability.
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