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Www.tfwallace.com Tom Wallace & Bob Stahl Best of the Best S&OP Conference First General Session SALES & OPERATIONS PLANNING: STRUCTURE, PROCESS, BENEFITS.

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Presentation on theme: "Www.tfwallace.com Tom Wallace & Bob Stahl Best of the Best S&OP Conference First General Session SALES & OPERATIONS PLANNING: STRUCTURE, PROCESS, BENEFITS."— Presentation transcript:

1 Tom Wallace & Bob Stahl Best of the Best S&OP Conference First General Session SALES & OPERATIONS PLANNING: STRUCTURE, PROCESS, BENEFITS Panelists: Amy Mansfield Joe Shedlawski Terry Finnegan Presenter/Moderator: Tom Wallace

2 Amy Mansfield V&M STAR Production Planning Manager

3 V&M STAR Vallourec & Mannesmann Tubes North America's leading producer of seamless casing Annual Capacity 500,000 metric tons finished product 1 st Executive S&OP Meeting, January 2006 Certifications: API 5CT, API 5L, OSHAS 18001, ISO 9001, ISO 14001

4 Products and Customers Oil Country Tubular Goods, Line and Standard Pipe, Coupling Stock and Mechanical Tube 100% Make-to-Order Sales Channels: 100% Distribution Key End Users: Devon, Exxonmobil, Chesapeake, Applied Drilling, El Paso

5 Joe Shedlawski, CPIM Wyeth Consumer Healthcare Principal, Commercial Operations Past President of APICS (2007)

6 Wyeth Consumer Healthcare Headquartered in Madison, NJ Global marketer and manufacturer of over-the-counter health care products-analgesics, nutritionals, respiratory, topicals $2.7 Billion global sales First Sales and Operations Planning implementation Lederle Consumer Healthcare-led by Joe Shedlawski One of the worlds top 5 consumer healthcare companies with several top market share brands

7 Products and Customers Major Products: Advil, Alavert, Caltrate, Centrum, Chapstick, Dimetapp, Robitussin 70% Make-to-Stock 30% Promotional Pack or Custom Display Key Customers: Wal-mart, Walgreens,CVS, Costco, Target, Rite Aid, Kroger (Sales Channel: Distribution Centers

8 Terry Finnegan ImagePoint Senior Business Manager

9 Largest provider of retail exterior image products and services Headquarters in Knoxville, TN Production facilities in Florence, KY and Columbia, SC $200M in annual sales Started ES&OP May 2007 ImagePoint

10 Products: signs, lettersets, electronic message centers, building elements, fascia systems, menuboards Services: surveys, installation, maintenance, project management, conceptual art, and engineering 100% Make-to-Order Key customers: McDonalds, GM, Honda, Nissan, Ford, Chrysler, Lexus, Chase, Wachovia, Wells Fargo, Rite Aid, Fed. Express, Sunoco Sales channels: direct to Corporate clients Products and Customers

11 Tom Wallace & Bob Stahl The Four Fundamentals Demand Supply Volume Mix How Much? Rates The Big Picture Product Families Strategy/Policy/Risk Monthly/18 Months+ Top Management Which Ones? Timing/Sequence The Details Individual Products, SKUS, Customer Orders Tactics/Execution Weekly/Daily 1-3 Mos Middle Management

12 Tom Wallace & Bob Stahl The Old Terminology DemandSupply Volume Mix Demand Planning/ Forecasting Supply (Capacity) Planning Sales & Operations Planning

13 Tom Wallace & Bob Stahl Sales & Operations Planning DemandSupply Volume Mix Master Scheduling Supplier and Plant Scheduling Distribution Scheduling Demand Planning/ Forecasting Supply (Capacity) Planning Sales & Operations Planning Morphed Terminology

14 Tom Wallace & Bob Stahl Sales & Operations Planning DemandSupply Volume Mix Master Scheduling Supplier and Plant Scheduling Distribution Scheduling Demand Planning/ Forecasting Supply (Capacity) Planning Sales & Operations Planning Morphed Terminology

15 Tom Wallace & Bob Stahl Sales & Operations Planning DemandSupply Volume Mix Master Scheduling Supplier and Plant Scheduling Distribution Scheduling Demand Planning/ Forecasting Supply (Capacity) Planning Sales & Operations Planning Morphed Terminology

16 Tom Wallace & Bob Stahl Sales & Operations Planning DemandSupply Volume Mix Master Scheduling Supplier and Plant Scheduling Distribution Scheduling Demand Planning/ Forecasting Supply (Capacity) Planning Sales & Operations Planning

17 Tom Wallace & Bob Stahl Sales & Operations Planning New Terminology DemandSupply Volume Mix Master Scheduling Supplier and Plant Scheduling Distribution Scheduling Demand Planning/ Forecasting Supply (Capacity) Planning ????????

18 Tom Wallace & Bob Stahl Sales & Operations Planning New Terminology DemandSupply Volume Mix Executive S&OP Master Scheduling Supplier and Plant Scheduling Distribution Scheduling Demand Planning/ Forecasting Supply (Capacity) Planning

19 Tom Wallace & Bob Stahl The 5-Step Executive S&OP Process Decisions & Updated Game Plan Step 1 Data Gathering Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre- Meeting Step 5 Exec Meeting

20 Tom Wallace & Bob Stahl Conference Pointer The Five-Step Process Dean Smetana, VP, Sanford/Sharpie Bill Zimmerman, Manager, Sanford/Sharpie 10:00 Thursday – Level I

21 Tom Wallace & Bob Stahl The 5-Step Executive S&OP Process Step 1 Data Gathering Actual Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Step 2 Demand Planning

22 Tom Wallace & Bob Stahl Conference Pointer Forecasting and Demand Planning Scott Harrison, VP, Valor Brands 11:10 Thursday – Level I

23 Tom Wallace & Bob Stahl Conference Pointer The Demand Management Game Robert Burrows, Principal, On-Point Group 9:45 Friday– Level I (double session)

24 Tom Wallace & Bob Stahl The 5-Step Executive S&OP Process Step 1 Data Gathering Actual Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Step 2 Demand Planning Step 3 Supply Planning

25 Tom Wallace & Bob Stahl Pointer Conference Pointer Supply Planning Joe Shedlawski, Principal, Wyeth 2:15 Thursday – Level I

26 Tom Wallace & Bob Stahl The 5-Step Executive S&OP Process Decisions & Updated Game Plan Decisions, Recommendations, Scenarios, & Agenda for Exec Meeting Step 1 Data Gathering End of Month Actual Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre- Meeting Step 5 Exec Meeting

27 Tom Wallace & Bob Stahl Pointer Conference Pointer How to Conduct the Pre-Meeting and Exec Meeting Brian Harlan, Director Johnsonville Sausage 3:45 Thursday – Level I

28 Tom Wallace & Bob Stahl Pointer Conference Pointer Obtaining Top Management Commitment and Participation Terry Finnegan, Senior Business Manager ImagePoint 10:00 Thursday – Level II

29 Tom Wallace & Bob Stahl Pointer Conference Pointer Resolving Conflict and Building Consensus John Gallucci, Director, Gerber 11:10 Thursday – Level II

30 Tom Wallace & Bob Stahl The 5-Step Executive S&OP Process Decisions & Updated Game Plan Decisions, Recommendations, Scenarios, & Agenda for Exec Meeting Step 1 Data Gathering End of Month Actual Demand, Supply, Inventory, & Backlog + Statistical Forecasts and Worksheets Management Forecast 1st-pass spreadsheets Resource Requirements Plan Capacity Constraints 2nd-pass spreadsheets Step 2 Demand Planning Step 3 Supply Planning Step 4 Pre- Meeting Step 5 Exec Meeting

31 Tom Wallace & Bob Stahl Question for Panelists Your Process: Same? Different? Hardest Part?

32 Tom Wallace & Bob Stahl Executive S&OP... Is an executive decision-making process Balances demand and supply Deals with volume in both units and $$$ Ties operational plans to financial plans: one set of numbers

33 Tom Wallace & Bob Stahl Pointer Conference Pointer Working with One Set of Numbers Amy Mansfield, Manager, V&M Star Melissa Takas, Financial Analyst, V&M Star 3:45 Thursday – Level II

34 Tom Wallace & Bob Stahl Executive S&OP... Is an executive decision-making process Balances demand and supply Deals with volume in both units and $$$ Ties operational plans to financial plans: one set of numbers Is the forum for setting relevant strategy and policy regarding demand and supply

35 Tom Wallace & Bob Stahl Question for Panelists What role does Top Management play in this process at your company?

36 Tom Wallace & Bob Stahl Hard Benefits Customer ServiceUP Plant ProductivityUP Inventory DOWN ObsolescenceDOWN Freight CostsDOWN Order Lead TimesDOWN Supplier Lead TimesDOWN Time to Launch New Products DOWN

37 Tom Wallace & Bob Stahl Pointer Conference Pointer S&OP Support for New Product Launch Craig Faulkner, S&OP, W. L. Gore 9:45 Friday – Level II

38 Tom Wallace & Bob Stahl Soft Benefits Enhanced Teamwork Structured Communications Better Decisions with Less Effort and Time Better $$$ Plans with Less Effort and Time Greater Accountability Greater Control Window into the Future Top Managements Handle on the Business

39 Tom Wallace & Bob Stahl Question for Panelists Biggest Benefits:Hard Soft

40 Tom Wallace & Bob Stahl Question for Panelists Implementation: How Long? Costs? Toughest Part?

41 Tom Wallace & Bob Stahl Pointer Conference Pointer How to Implement S&OP Successfully Rick Hall, VP, Homac/Thomas & Betts Bob Stahl, President, R.A. Stahl & Co 8:30 Friday– Level I

42 Tom Wallace & Bob Stahl The Global Challenge We are a series of organizations doing business locally, with intense global coordination. –Percy Barnevik Former CEO ABB Executive S&OP should support these dual objectives.

43 Tom Wallace & Bob Stahl Pointer Conference Pointer S&OP in a Global Business Alan L. Milliken, Manager, BASF 8:30 Friday– Level II

44 Tom Wallace & Bob Stahl The Future of Executive S&OP: Growth Factors Success breeds success

45 Tom Wallace & Bob Stahl Adoption of New Processes There is a year lag between the development of a new process and its widespread adoption. Examples: MRPII/ERP, TQM/6SIGMA, JIT/LEAN Executive S&OP Today The word gets around.

46 Tom Wallace & Bob Stahl The Future of Executive S&OP: Growth Factors Success breeds success Lean Manufacturing and S&OP

47 Tom Wallace & Bob Stahl Toyota: The Lean Poster Child At Toyota, production is pushed into Fin Goods Inv (~ $2-3 Billion) In many companies, production is pulled by Customer Demand In balancing demand and supply, many companies have a tougher job than Toyota. Their solution: Executive S&OP.

48 Tom Wallace & Bob Stahl Pointer Conference Pointer S&OP and Lean Manufacturing Jeff Greer, VP, KVH Industries 2:15 Thursday – Level II

49 Tom Wallace & Bob Stahl The Future of Executive S&OP: Growth Factors Success breeds success Lean Manufacturing and S&OP Globalization

50 Tom Wallace & Bob Stahl The Future of Executive S&OP: Growth Factors Success breeds success Lean Manufacturing and S&OP Globalization New users outside traditional manufacturing S&OP specific software

51 Tom Wallace & Bob Stahl Pointer Conference Pointer Technology as an S&OP Enabler Larry Lapide, Director, MIT 10:55 Friday– Level II

52 Tom Wallace & Bob Stahl The Future of Executive S&OP: Growth Factors Success breeds success Lean Manufacturing and S&OP Globalization New users outside traditional manufacturing S&OP specific software Greater financial integration, power and utility A highly visible presence in the executive suite

53 Tom Wallace & Bob Stahl My Prediction Over the next 10 years, Executive S&OP will emerge as a primary tool in the Top Management tool kit. It will be widely viewed as indispensable for organizations needing to balance demand and supply in a complex, rapidly changing environment. Tom Wallace Chicago June 19, 2008

54 Tom Wallace & Bob Stahl Thanks for Listening To get copies of slides: will be up by Monday morning


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