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Mastering sales and operations planning (S&OP) in modern organizations
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Mastering sales and operations planning (S&OP) in modern organizations
From the s&op planning process to tools, discover our curated recommendations for effective Sales & Operations Planning (S&OP). Learn how to align sales goals, optimize operations, and drive growth in 2024.
%20(1).png)
Mastering sales and operations planning (S&OP) in modern organizations
From the s&op planning process to tools, discover our curated recommendations for effective Sales & Operations Planning (S&OP). Learn how to align sales goals, optimize operations, and drive growth in 2024.
%20(1).png)
Mastering sales and operations planning (S&OP) in modern organizations
From the s&op planning process to tools, discover our curated recommendations for effective Sales & Operations Planning (S&OP). Learn how to align sales goals, optimize operations, and drive growth in 2024.
Mastering sales and operations planning (S&OP) in modern organizations
From the s&op planning process to tools, discover our curated recommendations for effective Sales & Operations Planning (S&OP). Learn how to align sales goals, optimize operations, and drive growth in 2024.
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Your Head of Product wants to launch a new iteration of your bestselling product next year. It's great, in theory, sure—but the timeline is unclear right now, and so you can’t align your sales strategy with the launch. This means your supply chain department also doesn’t know when to start sourcing new suppliers. Finance teams also haven’t run their P&L calculations to confirm it’d be a smart move, either. Executives, therefore, have struggled to buy into the idea, so the wheels are off before they’ve even started turning.
Proper sales and operations planning (S&OP) helps solve for this organization challenge. Done well, a strong S&OP process enables your business to make better, data-driven decisions by aligning key stakeholders that spearhead each department—finance, supply chain, sales, marketing, operations, and product—to anticipate demand and plan supply or rollout.
Concurrently, however, today sales forecasting can feel like a shot in the dark. Poor data quality can make it impossible to tell what the future holds, and when departments are siloed and fail to communicate effectively, you don’t have a solid vision and an aligned supply plan on how to get there.
So below we're walking through how to solve these problems with an S&OP framework that encourages collaboration and helps all teams match supply—or delivery—with anticipated demand.
What is sales and operations planning (S&OP)?
Sales and operations planning (S&OP) refers to the alignment of all departments—including sales, marketing, supply chain, and finance—to have your business function effectively. The strategy identifies areas of wasted potential, encourages cross-departmental collaboration, and balances supply with anticipated demand.
The goal of S&OP is to:
- Predict customer demand—and ensure you have the optimal resources to meet said demand,
- (where applicable) Optimize inventory to prevent stockouts while also balancing carrying costs,
- Plan the go-to-market strategy for any new products, or the discontinuation of others,
- Align plans with financial objectives, and
- Encourage alignment and collaboration between all departments overall.
In the past, a traditional approach to S&OP planning was driven by gut instinct. The next iteration relied on spreadsheets with historical data—but these figures often became outdated by the time the executive review happened.
Modern S&OP practices, however involves real-time data and predictive analytics to tell you not just what happened before, but what might happen next—before your own data begins to reveal a trend.
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Sales and revenue leaders, in particular, need to come to S&OP meetings with detailed sales forecasts to make this possible. For this, a full-stack sales performance management (SPM) software to consolidate real-time data from various sources (ERP, inventory management systems, supply chain tools, HR software, etc.) can be very helpful. With an SPM you build a central repository of data that can help with more accurate sales planning thanks to more accurate quotas, territories, and modelling for sales incentives for finance.
%2520(1).png)
Your Head of Product wants to launch a new iteration of your bestselling product next year. It's great, in theory, sure—but the timeline is unclear right now, and so you can’t align your sales strategy with the launch. This means your supply chain department also doesn’t know when to start sourcing new suppliers. Finance teams also haven’t run their P&L calculations to confirm it’d be a smart move, either. Executives, therefore, have struggled to buy into the idea, so the wheels are off before they’ve even started turning.
Proper sales and operations planning (S&OP) helps solve for this organization challenge. Done well, a strong S&OP process enables your business to make better, data-driven decisions by aligning key stakeholders that spearhead each department—finance, supply chain, sales, marketing, operations, and product—to anticipate demand and plan supply or rollout.
Concurrently, however, today sales forecasting can feel like a shot in the dark. Poor data quality can make it impossible to tell what the future holds, and when departments are siloed and fail to communicate effectively, you don’t have a solid vision and an aligned supply plan on how to get there.
So below we're walking through how to solve these problems with an S&OP framework that encourages collaboration and helps all teams match supply—or delivery—with anticipated demand.
What is sales and operations planning (S&OP)?
Sales and operations planning (S&OP) refers to the alignment of all departments—including sales, marketing, supply chain, and finance—to have your business function effectively. The strategy identifies areas of wasted potential, encourages cross-departmental collaboration, and balances supply with anticipated demand.
The goal of S&OP is to:
- Predict customer demand—and ensure you have the optimal resources to meet said demand,
- (where applicable) Optimize inventory to prevent stockouts while also balancing carrying costs,
- Plan the go-to-market strategy for any new products, or the discontinuation of others,
- Align plans with financial objectives, and
- Encourage alignment and collaboration between all departments overall.
In the past, a traditional approach to S&OP planning was driven by gut instinct. The next iteration relied on spreadsheets with historical data—but these figures often became outdated by the time the executive review happened.
Modern S&OP practices, however involves real-time data and predictive analytics to tell you not just what happened before, but what might happen next—before your own data begins to reveal a trend.
_%2520(1).png)
Sales and revenue leaders, in particular, need to come to S&OP meetings with detailed sales forecasts to make this possible. For this, a full-stack sales performance management (SPM) software to consolidate real-time data from various sources (ERP, inventory management systems, supply chain tools, HR software, etc.) can be very helpful. With an SPM you build a central repository of data that can help with more accurate sales planning thanks to more accurate quotas, territories, and modelling for sales incentives for finance.