Sales and Operations Planning
Part One: Identifying and Forecasting Demand
Dr. Scott Hamilton - December 11, 2003

Introduction

A firm's sales and operations planning (S&OP) process starts with the definition of all demands for the firm's goods and services. It formulates game plans that drive supply chain activities to meet those demands. Hence, an effective S&OP game plan requires consideration of both demands and supplies. The nature of each product's game plan depends on the environment. The game plan may focus on stocked end-items in distribution and make-to-stock manufacturing environments. The game plan for a make-to-order manufactured product depends on the level of stocked components and the need for direct linkage between production orders and sales orders. The game plan for a multisite environment may require consideration of inventory replenishment across a distribution network. Variations in production capabilities such as lean manufacturing also affect the game plan. The saleable products for many firms represent a mixture of environments...