Tag Archive: SIOP

Forecasting: How Far Should You Look into the Future?

July 3rd, 2017
SIOP S&OP

Setting strategy or designing a sales, inventory and operations planning (SIOP) process requires forecasting. How far into the future do you look and why?

Whether setting strategy or designing a SIOP (sales, inventory and operations planning) process, one of the most important questions to consider in forecasting is how far into the future will you look? And why?

As we think about whether the answer should be 1 month, 1 quarter or 1 year, check your thinking. When assessing the future it is important to think through the elements that may impact your forecast.

10 Questions to Ask When Forecasting and Designing SIOP

1. Do you have customer contracts in your business/ industry? If so, how far out do they go?

2. Regardless of the commitment level, how far out do you have information that is somewhat reliable? If it changes substantially from month-to-month, is it of any value?

3. How reliable is your forecast by product or customer grouping? Forget about items and sku-level forecasts. How about product category forecasts?

4. Do you have access to demand data into your supply chain?

5. Are you asking questions about what is coming down the pike? If not, why not?

6. How much cushion do you have? Do you have inventory or capacity availability?

7. How prepared is your supply chain? Can they handle volume spikes?

8. Are you willing to dedicate people to gain a view into the future? Why or why not?

9. Have you considered a strategic sprint? Why are you setting arbitrary time frames when customers don’t care what you do? They want what they need when they need it.

10. Are there downsides to looking too far into the future? What are they?

 

Did you like this article? Continue reading on how to strengthen your Eagle Eye:

Forecasts Are Always Wrong So Why Bother?

4 Excel for SIOP Success

 



Duke University & CFO Global Outlook Survey Suggests Optimism

March 23rd, 2017

According to CFO, Duke University and CFO Global Business Outlook Survey suggests strong optimism! In fact, the survey’s optimism index for the quarter jumped to 69 (on a 100-point scale) which is the highest level in 14 years. This is also significantly higher than the long-run average of 60. Businesses are optimistic.

61% plan to increase their payrolls this year and 4% wage hikes are expected. Even more noteworthy is that capital spending is expected to increase by 6% vs. a median of 3% and a flat/negative spend in 2016. Are you ready?

business optimism

What Should We Consider and/or What Impacts Could Arise?

Good news abounds. However, the tricky part is that the vast majority of our clients struggle to sustain successful growth (profitable, high service levels etc.). We don’t enjoy layoffs and recessions but they can be simpler to manage. Are you ready for growth?

Our most successful clients prepare for growth. They invest in infrastructure with enough lead time to implement successfully BEFORE they must have it. This could refer to systems, technology, people, training and development, process improvement techniques, culture and change initiatives and more — of course, it depends on your business. Undoubtedly, this is easier said than done! One of these initiatives that is geared especially well to growth is SIOP (sales, inventory, operations planning). SIOP programs are focused on forecasting demand, collaborating with customers and aligning with staffing, capacity, systems and process infrastructure, training and development and so on. If you’d like to talk about preparing for growth, contact me.

 



The Calm After the Storm

January 23rd, 2017


While driving up the street to my house on the way back from driving both directions to the port of San Pedro for a port tour in a horrific storm (for Southern California), I see the calm after the storm. Southern Californians know just how challenging the rush hour freeways can be in a rain shower, and so it is especially significant to see the beautiful effects that can come from such havoc.

How many times do we get caught up in some sort of storm at work (ERP implementations, merger or acquisition, a major change project such as a lean transformation or SIOP initiative) and fail to appreciate the calm after the storm – and celebrate the results?

 

One tip to implement this week:

Unfortunately, we all can probably think of many, many storms in our work life without prompting. If we keep our eyes on the goal even in the worst of it, we’ll see the sun shine through as we complete a milestone or as we drive it home.

While in the midst of a storm this week, remember to keep focused on the goals. Provide a visual of those goals to your team, colleagues and partners. Create a visual if you don’t have one. Generate some excitement about the next milestone. Soon, you’ll emerge on the other side and you’ll see the skies open up and your end results shine through.

 

Looking for more ideas to keep your supply chain connected? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”

 



People Remain “In”

December 27th, 2016
people first

If you want to achieve profitable business growth apply the people plus initiative equation and see how your bottom line transforms.

No matter how many conversations go on about technology and the latest and greatest processes to drive results in manufacturing and distribution companies (including robots and automation taking over lower-skill positions), people remain “in”. Without exception, our best clients consider people their #1 asset.

Who develops the programs for the robots? Who figures out how to utilize business analysis tools and predictive analysis/artificial intelligence concepts? And who implements best practice processes such as lean manufacturing, SIOP/S&OP and the like? People!

There is zero doubt that the best employees with mediocre machines, technologies and less-than-desirable systems will outperform mediocre employees with the best machines, technologies and systems — every time! We cannot count the times a facility turned around with a new, exceptional leader. On the other hand, we have also seen large complex organizations change out General Managers like singers change clothes in concerts (for example, Reba used to change clothes 15 times in one concert!) — with NO better results (and often worse results) repeatedly. Eventually, a strong leader arrives with largely the same team and transformation begins. Since we pride ourselves on our successful track record of achieving tangible results in partnership with our clients, it is obvious how important people are in achieving this goal. Our initiatives can turn from tough challenges that will take longer to achieve success into fun, exciting rapid-change projects that deliver bottom line results based on the leader we partner with on the project. 

Did you like this article? Continue reading on how to Profit Through People:

Project Success is All About the People

Never Stop Learning

 



Hot Topics in Supply Chain Management?

October 11th, 2016
hot topics in supply chain management

Empower your operation by arming yourself with knowledge of supply chain trends. See the top four I learned from the APICS International Conference.

One of the reasons we attend the APICS International Conference is to understand what is trending in supply chain today. Which topics are “hot”?

1. Logistics – APICS’ new certification, CLTD (certified in logistics, transportation and distribution) is the hottest ticket in town. Not only were there many educational sessions about these topics, the APICS Inland Empire chapter gets inquiries every week about it. In today’s Amazon-impacted world, logistics is cornerstone to success – how else will you deliver exceptional customer service rapidly and cost-effectively?

2. SIOP (Sales & Operations Planning) – this is near and dear to my heart as a significant portion of LMA Consulting Group’s practice focuses on helping clients achieve significant results (growth, service, profit and cash) with SIOP. Check out our proprietary process, 4 EXCEL for driving exponential results with SIOP.

3. Data & the digital world – PwC published a report, “Connect and optimize; The new world of digital operations”. We are on the cusp of a digital revolution. It certainly has taken over the e-commerce and distribution world, and now it is taking over manufacturing and supply chains. Mobile technology, big data, the internet of things…

4. Risk – and, let’s not forget risk. There are countless risks when looking at your end-to-end supply chain. How can you develop a resilient supply chain? Have you thought about political risks, natural disasters, security risks, financial risks — and the list goes on.

Keep track of what is trending in your business. As my HR mentor used to say, “knowledge is power”. Do you have the power? If you’d like to get an assessment of your supply chain performance, contact us.

Did you like this article? Continue reading on how to be the Strongest Link in your organization:

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