Supply Chain Planning and Execution are Not Two Different Things

Don’t Believe the Great Software Fallacy: Planning and Execution are Not Two Different Things

Do planning and execution need to be two separate applications based on business needs or is the separation really a limitation of today’s legacy software architectures?

In fact, isn’t keeping them separate actually hurting business? Why reinforce silos? How much better would your business perform with a unified approach?

Let’s think about what is really happening in today’s supply chain network ecosystems.

Overall, the ecosystem is rewarded when an end consumer purchases a product or service.

Let’s call this “time zero” or the “moment of truth”. Now let’s travel backward in time from time zero through our supply network – to the hours prior to purchase - days, weeks, months, and even years.

Earlier in my career, my team developed massive 3 to 5-year simulations for large manufacturing, distribution, and retail companies.

In order to properly structure the supply network required to deliver, for example, on the mix of vehicles and options needed to achieve a brand plan for an automotive company, we had to create hundreds of thousands of representative vehicle orders to roll up to the simulation so that we could actually generate the upstream parts demand through the network as well as the downstream profitability models and dealer allocations based on option take rates.

With the simulation, we were able to finalize capital planning as well as our supplier contract capacity and risk models.

There was no separation of planning and execution. It was all about delivering a supply network capability that would capitalize on the market opportunity - selling specific vehicles to specific individuals in specific geo-demographic regions.

Sprouting Applications: One (Or More) For Every Time Horizon

This world of optimizing business and running as a continuum across all time horizons, delivering to both customers and shareholders, only existed in the simulation.

After that, unified thinking experienced a serious breakdown! Once we moved across time from a multi-year to an annual timescale, the software industry gave us separate applications like Integrated Business Planning (IBP) and Sales and Operations Planning (S&OP).

And then as we moved closer to the “moment of truth” they told us we had to start using yet another set of applications called Sales and Operations Execution (S&OE) software, along with other order and execution level systems.

Download this white paper and learn how increased visibility to real market demand can help your planning and execution business needs.