Sales And Operations Planning part iii: Adiagnostic Model

SALES AND OPERATIONS PLANNING PART III: A DIAGNOSTIC MODEL By Larry Lapide (This is an ongoing column in The Journal, which is intended to give a brief view on a potential topic of interest to practitioners of business forecasting. Suggestions on topics that you would like to see covered should be sent via email to llapide@mit.edu). This column represents the last of a three-part series covering the Sales and Operations Planning (S&OP) process. As discussed in Part I, S&OP has been lately receiving a lot of attention as industry-wide studies and companies are recognizing its value in improving the tactical and operational planning to prepare the supply chain for meeting anticipated customer demand. S&OP appears to be driving supply chain benefits such as better meeting customer demand while at the same time resulting in reduced inventories and minimized supply chain operating costs. In addition, an indicator of a longer term interest in the S&OP process is the fact that, according to AMR Research, companies have spent over $12 billion in supply chain planning application software over the last 6 years. Yet while spending significant sums of money on the S&OP-related software, they ...