Effective game plans lead to improved firm performance and bottom line results. Metrics include reductions in stock-outs, delivery lead-time, missed shipments, partial shipments, and expediting efforts. Metrics also include improvements in customer service. The lack of effective game plans is typically cited as a leading cause of poor system implementation. The following guidelines provide suggestions for improving the effectiveness of sales and operations planning (S&OP) game plans.
Minimum Planning Horizon for Each Game Plan. A saleable item's cumulative lead-time represents the minimum horizon for a game plan, and additional months provide visibility for purchasing and capacity planning purposes. An additional six to twelve month planning horizon is typically recommended. This minimum planning horizon should be reflected in the item's time fences, such as the coverage and forecast time fences.
Reviewing and Updating Game Plans. The process for reviewing and updating each game plan should be embedded into the firm's regularly scheduled management meetings focusing on demands and supply chain activities. An agreed-upon game plan reflects a balance of conflicting objectives related to various functional areas, such as sales, engineering, manufacturing, purchasing and accounting. Periodic revisions to game plans should be reflected in updated forecasts.
Primary Responsibility for Maintaining Game Plans. The person(s) acting as a master scheduler maintains the game plans and obtains management agreement. This role typically requires an in-depth understanding of sales and supply chain capabilities, as well as the political power to achieve agreed-upon game plans. The responsibility for providing sales order and forecast data typically belongs to the sales function, with a hand-off to the master scheduler. The primary responsibility for game plans should be reflected in the planner (and buyer) responsibility assigned to items.
Formulating Realistic Game Plans. Realistic game plans require identification of capacity and material exceptions that would constrain the plans, and then eliminating the constraints or changing the plan. Identification of material-related exceptions typically starts with suggested actions, while capacity exceptions are identified using work center load analysis. In many cases, a realistic game plan must anticipate demands and demand variations via forecasts and inventory plans for stocked material. Finite scheduling can also contribute to a realistic game plan.
Enforcing Near-Term Schedule Stability. Near-term schedule stability provides one solution for resolving many conflicting objectives, such as improving competitive efficiencies in purchasing and production and reducing exceptions requiring expediting. It provides a stable target for coordinating supply chain activities and removes most alibis for missed schedules. Near-term schedule stability can benefit from inventory plans and realistic order promises about shipment dates. It involves a basic trade-off with objectives requiring fast response time and frequent schedule changes. The critical issue is that management recognizes the trade-offs to minimize near-term changes. The freeze time fence represents one approach to support near-term schedule stability, since planned orders will not be placed in the frozen period.
Making and Maintaining Realistic Sales Order Promises. Realistic delivery promises represent the key link between sales commitments and supply chain activities. The system support delivery promises during order entry, and also through planning calculations that suggest delayed delivery based on projected completion dates. A critical issue is to reduce and isolate the number of sales order exceptions requiring expediting. One solution approach for meeting a delivery promise involves splitting delivery across two sales order line items with different shipment dates.
Executing Supply Chain Activities to Plan. Planning calculations make an underlying assumption that everyone works to plan, and the system provides coordination tools to communicate needed action. For example, it is assumed that procurement will ensure timely delivery of purchased material so that manufacturing can meet production schedules. It is assumed distribution will make on-time shipments because sales made valid delivery promises and procurement and production are working to plan. An unmanageable number of exceptions will impact this underlying assumption and the usefulness of coordination tools.
Reducing Exceptions that Require Expediting. The intent of near-term schedule stability, valid delivery promises and shipment dates, realistic game plans, and executing to plan is to reduce the number of exceptions to a manageable level. This improves the usefulness of coordination tools to meet the game plans.
source:http://www.technologyevaluation.com/research/articles/managing-your-supply-chain-using-microsoft-axapta-a-book-excerpt-part-four-guidelines-and-case-studies-17224/
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