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  • Doug Dedman

Everything I know about S&OP I learned on the farm: Plowing your way to S&OP stability

Updated: Nov 17, 2022

Plowing:  A Lesson in staying on the straight path

Things change. We all know this. Our kids get older, we get older. We start our morning with coffee, then we are told we need to cut back on coffee. So we start our morning without coffee. Change is not always our choice, sometimes it is imposed on us. This observation leads me to the question: How do we plan for change without over-reacting?

When it comes to S&OP, we strive for consistency in how we deal with change. But how do we put this into practice?

For example, each month you run your S&OP process. You have a sales pre-S&OP meeting. In this meeting, sales and marketing look at both your customer forecasts and your marketing plans, and come up with a demand forecast. This forecast is reviewed by operations, who put together a production plan to meet the demand. Then, in the executive S&OP, you finalize the plan, and agree on the sales and production levels going forward. The plan may go out for 12 months but, at the very least, you are focusing over the next three months. Finally, you align your production resources and suppliers with this plan by updating the master schedule and material planning.

Another job well-done. You think about having a coffee after all. Then the month begins.

The day after the S&OP meeting (or maybe the week after), the emails and phone calls begin.

“Sales look a little soft,” someone says.

“Our order inflow rate doesn’t match the forecast,” someone else notices.

“I think we should reduce daily production levels due to the lower sales,” you hear in a voice mail message. “Call the suppliers to get them to reduce next week’s shipments.”

“We need to reduce a shift next week," you read in an e-mail.

At the end of this barrage you are calling suppliers to defer some shipments so that you are not left with excess inventory. You’ve made the right decisions based on what’s truly happening. You know you did. Or did you?

Without a good plan it's difficult to know how to react!