8. Sales and Operations Planning (S&OP)

Sales and Operations Planning (S&OP) Defined

In its simplest terms, sales and operations planning (S&OP) is a process a business uses to ensure that supply can match demand, at least on the aggregate. (S&OP is therefore also often referred to as aggregate planning.) With S&OP, executive-level management regularly meets and reviews projections for demand, supply, and the resulting financial impact (typically integrated with the results of more detailed work, described earlier, when developing forecasts and in some cases production plans). S&OP is a decision-making process which ensures that tactical plans in every business area coincide with the company’s business plan. The net result of the S&OP process ...

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