S&OP needs to evolve....here's how

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A few weeks ago I wrote a blog titled “S&OP needs to evolve – I’m frustrated with traditional thinking!” in which I questioned a description of S&OP that is as much as 30 years old. Just to reiterate, I agree that much of the difficulty of implementing S&OP is the organizational change management to adopt a new process. What I am questioning is what that new process should be. Henry Ford is quoted as having said

If I had asked my customers what they wanted, they would have said faster horses.

An interview with Andrew McAfeeSome people actually use that as an argument against user research: don’t listen too closely to your customers. But Ford was successful because his product addressed people’s underlying needs based upon their expressed wants. And that is what research is all about. I am not pretending to know everything that customers and prospects need, but there are some customers and prospects that are expressing wants that cannot be satisfied by traditional descriptions of S&OP. But I’d like to go beyond wants and needs to find solutions to the problems that our customers don’t know they have. Andrew McAfee, research scientist at the Center for Digital Business in the MIT Sloan School of Management recently expressed this sentiment very well in the video below. (Click on the image to go to the video.)

Another Henry Ford quote that I love is

Coming together is a beginning; keeping together is progress; working together is success.

I love this quote because it captures a central concept of S&OP maturity and emphasizes collaboration as a central theme. But the discussion of collaboration leads directly to the frustration I expressed in my earlier blog.

At one level, there is no doubt that collaboration is about process and people first. But the rapid uptake of social media has clearly demonstrated that technology has a role to play in promoting collaboration between people that are widely dispersed (and likely do not know each other), which is a common enough phenomenon in today’s outsourced and off-shored supply chains.

The role of technology goes beyond bringing people together - it must also facilitate capturing their assumptions, inputs and opinions, which are of course so important in evaluating what went right and what did not. And lastly, as much as the concepts for exchanging information have progressed from pen and paper, to FAX, to email, to social media, so must the concepts about capturing and evaluating data changes and projected consequences.

They must progress from double entry accounting concepts, to spreadsheets, to shared information that is accessible immediately, including changes that are made by others in the supply chain. Alerts need to be sent out to inform people of their need to participate in a scenario, and a collaborative environment needs to be provided in which they share, evaluate, and approve changes. This is what working together is all about.

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