Page 379 - Orlicky's Material Requirements Planning

358 PART 3 Managing with the MRP System

FIGURE 20-19

Breakthrough Strategic Intent and
S&OP—right to Future Portfolio
left.

Align

Reconcile

Unify

Agreed
Latest View

Implementation Approach “Right to Left”

improvement program, or reimplementation and achieve dramatic results within six
months by using our right-to-left breakthrough approach (Figure 20-19).
Having aligned the process at the beginning with the strategic intent and future port-
folio, we can reconcile the different views within the business to the future business agen-
da and sustainable success. The end result, achieved though cross-functional behavior, is
an agreed-on latest view over 18 to 24 months for both operational and business plans.
During the evolution, we were attempting to unify first, then reconcile, and finally,
align S&OP. We now know that the order must be reversed. We align the S&OP process
with the business agenda first, then reconcile different views, and finally, unification is
achieved through agreeing to the latest view of the future. The most rapid and sure way
to implement S&OP successfully is to implement from right to left.
To summarize, the key concepts of S&OP that are worthy of executive attention are
1. Executive leadership. The process should not be led by supply only. At the very
least, the supply chain and finance should jointly lead the process, and this is
appropriate in businesses following cost leadership as a strategy. In other cases,
direction of the process should come from sales and marketing; when the
strategic intent of the business is customer relationships, it should be sales led,
and marketing should lead when a business follows product/service differenti-
ation. Finance always should have a strong lead in the process because of its
role in business planning, whatever the strategic intent. Ideally, executives
should champion the process, but in large multinational companies, this is not
always possible. Senior management does not normally buy the process; they
buy the results. However, the process must be rigorous and disciplined so that
the executives can have confidence in the integrity of the information.