Page 355 - Orlicky's Material Requirements Planning

334 PART 3 Managing with the MRP System

FIGURE 20-4

S&OP change Strategic
model. Annual Change Planning Annual Change

Business
Planning
Annual Budget

S&OP

Tactical
Change Planning Change

Operational
Planning

their own functional agenda was virtually impossible. Very often the one who shouted
loudest got his or her way, but if finance did not agree, the number was questionable.
In fact, this obsession with one number was seen as the Holy Grail and S&OP as the
great unifier—the way to get a single number. Why? Because multiple sets of numbers cre-
ate confusion. They do, but the antidote is not a single number. What is needed is an
agreed-on latest view that comes as a result of reconciliation of different views (see next
section). In a traditional pre-S&OP meeting in an organization with a silo culture, there
was no recognition that different views add value—they were considered an obstacle to a
decision. In such organizations, one can see the politics. What is said in a meeting is influ-
enced by functional positioning. It influences where and when things are said, by whom,
to whom, and against whom. It is impossible to harness all the ability and knowledge of
all participants to obtain the optimal agreed-on latest view in such an environment.
This culture is often reinforced by the A versus B syndrome. The symptoms of this
are polarity and argument around two different options when creation of a third or
fourth option may well be the best solution. Here, verbal dexterity in support of one or
criticizing the other absorbs all the talent and time. Often whoever is fastest on his or her
feet with the best information or examples in support wins for A versus B—even if more
considered thought would produce the opposite and conclude that B is better and even
a solution where an undeveloped C or D would be better still.
Some reconciliation of different views must take place before there is agreement on
what a number should be. We should have seen that S&OP must be the great reconciler
before it could be a unifier.