IN CONVERSATION with BOB STAHL 2019-01-02

Starting Off the New Year

By: Stephen Cherlet, CSCTA

My colleague, Tom Gottlieb, and I are fortunate in being able to have regular discussions with Sales and Operations Planning (S&OP) luminary Robert (Bob) Stahl. Our discussions are wide-ranging on the topic of S&OP but always interesting and illuminating. We try to extract some of the pearls of wisdom that come out of those discussions, so we can share them across a wide audience.

Our format is like a “fireside chat” that can lead in any, 
and multiple directions but the basis for our

talks is consistently Bob’s book Sales Forecasting--A New Approach, Sales & Operations Planning--The How-To Handbook. The steps and phases outlined in the book are summarized at the end of the article for easy reference.

In today’s discussion, the three of us were talking about S&OP implementation. Bob pointed out that the strength of an implementer is not founded on specific knowledge of S&OP but rather on the ability to create a process based on consensus. I paraphrase Bob’s thoughts below:

“The goal of S&OP is to create a defined process to bring people together, working collaboratively to achieve a consensus across differing opinions.”

Let’s reflect on that. Three points come to my mind:

1.       S&OP is a process. It should not be confused with specific software or technology.

2.       This process is collaborative. Everyone must work individually and together, through the first three steps: 1) Data Gathering, 2) Supply Planning, and 3) Demand Planning. Team collaboration needs to be well established to successfully deploy Phase III (Full Financial Integration) when everyone is working with one set of numbers.

3.       There must be consensus, especially with regards to which points, and solutions, arising from the Pre-Meeting (Step 4) will be raised at the Executive Meeting (Step 5).

We would love to hear from you. Please feel free to like this post and comment on it. How do you define S&OP? Do you agree with Bob that it is a process? Why/why not? Can you share any tips on how you reach consensus?

-          -    -      -     -     -       -

The Monthly Executive S&OP Process

·         Step 1 – Data Gathering

·         Step 2 – Demand Planning

·         Step 3 – Supply Planning

·         Step 4 – Pre-Meeting

·         Step 5 – Executive Meeting

The Implementation Phases

·         Executive Briefing (Go/No-Go #1: let’s do a live parallel pilot)

·         Phase I – Live Pilot (Go/No-Go #2: let’s run the whole place like this)

·         Phase II – Expansion

·         Phase III – Financial Integration (fully integrated through, including simulation, with proforma P&L and Balance sheet information)

About Bob Stahl: For over 48 years Bob Stahl has been helping executives and managers acquire superior decision-making processes. These skills are essential in a complex, rapidly changing environment that puts a premium on high customer service, wide product variety, quick response, and low cost. He has coauthored six books, including Sales Forecasting--A New Approach, Sales & Operations Planning--The How-To Handbook (now in its 3rd Edition), and Sales & Operations Planning--The Executive’s Guide.

About FarStar: FarStar is boutique consulting firm with a focus supply chain transformation, of which a key lever is Sales & Operations Planning. With team members located in Canada and the US, the company has extensive experience across a wide range of industries including aerospace, defence, high-tech/electronics, and industrial products in a variety of business environments, ranging from make-to-stock to engineer-to-order.