Page 375 - Orlicky's Material Requirements Planning

354 PART 3 Managing with the MRP System

FIGURE 20-16

Aligning decision making with executive strategy.

Global
Activities that need to be managed and
decisions that need to be taken globally

Regional
(e.g., Europe) Activities that need to be managed and
decisions that need to be taken regionally

Activities that need to be managed and
Country decisions that need to be taken locally

Week 1 Week 2 Week 3 Week 4

This is a subject in its own right and beyond the scope of this chapter. The design of
the S&OP process needs to be specific to the company because the company has various
degrees of complexity. For example, managing the portfolio and new activities may be
directed globally, coordinated regionally, and executed locally. There is a managing-the-
portfolio and new-activities step at all three levels.
In some pharmaceutical and chemical companies, active-ingredient supply deci-
sions are global, formulation-supply decisions are regional, and end-item (packed and
labeled SKUs) supply is local. Again, there is a managing-supply step at all levels, where
decisions at the global level are more long term and strategic, regional issues are strate-
gic and tactical, and country decisions are largely tactical. Our experience is that there is
no one-size-fits-all guide in these more complex scenarios. This guide must be tailored to
individual business needs, or it may be more helpful to obtain the guides to global,
regional, and country S&OP.
However, despite the differences in complexity and company structure and operation,
there are some subprocesses that apply universally and are essential to successful business
operation. Assumption-based forecasting and scenario planning are two of these. It could be
argued that if a company operates in a single country and market, assumptions on the busi-