There are serious issues with the company’s out-of-stock situation.
The CEO is under a lot of pressure, whereas his key customer chains have put his company on the short list of worst-performing companies in terms of not delivering orders on time. Customers regularly threaten to stop doing business with the company. Sales management often receives complaints from unsatisfied customers. The company is on the short-list of many customers and rated as one of the ten worst-performing companies for delivery performance. Senior management spends a lot of their time overcoming supply and demand crises by monitoring priorities in being short of supply. A built-in conflict exists between departments: sales, marketing, procurement, production, distribution, warehouses, and finance. If this situation continues like this, the company could potentially lose large sales and market share.
Operational assessment of S&OP
Effective S&OP is one of the core hallmarks of business and the underlying foundation for building competitive advantages, bringing together in one unified plan the best schemes of sales, services, marketing, finance, and operations. For many businesses, there are untouched opportunities to be captured by developing effective and efficient Sales & Operations planning practices.
S&OP Definition: Sales and operations planning is the scheme that produces the best possible results by leveraging best practices of sales, marketing, procurement, manufacturing, transportation and warehousing, and finance to benefit consumers, the customers, and the enterprise to its best. The most effective planning schemes focus on continuous improvements in creating value-added and stronger organizational readiness for a company.
Approach provided by TPC Consulting
You must manage a dynamic, challenging, and complex process to resolve this issue. Through a systematic approach, we helped the Company effectively and efficiently manage the entire value chain. This generated faultless product availability, flexibility, and quality at the lowest cost proposition.
- Rethink the business model (S&OP view)
- Focuses to create competitive advantages
- From bottom up planning structure
- System calibration
- Continuous improvement focuses
Results after the changes
The company is considered one of the leading service performers on the market, and out-of-stock issues rarely occur. The company operates under a unified planning system that drives competitive advantages through detailed planning excellence. The system focuses on continuous improvement and value creation by eliminating destroy of values of the system. Daily, weekly, and monthly sales are monitored and tracked continuously to manage all the upcoming changes in the process before they become critical problems.