oracle & usjade power breakfast presentations: sales & operations planning

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Oracle Executive Power Breakfast: Next Generation Sales & Operations PlanningNovember 18, 2010

The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions.The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.

Safe Harbor Statement


Agenda

8:00- 8:10 Kickoff/Welcome Layne Devereaux8:10-8:40 Next Generation S&OP - Customer Case Studies

Gerald O'Sullivan8:40-9:10 Oracle S&OP Supply Side Customer Case Study

Steve Zadig9:10-9:50 S&OP Best Practices Mel Nelson9:50-10:00 Summary/Q&A Facilitation Rosan Primeau, USJade


Oracle’s Next Generation S&OP Customer Case Studies

• Business Case for Next Generation S&OP• Oracle Solution Overview• Customers Achieving Next Generation S&OP• Summary

Challenges

Demand uncertainty and volatility

Lack of responsiveness and inflexibility in supply network

Misalignment of financial and operational plans in continuously changing business conditions

Strategies

Lack of proactive insight into the impact of your decisions

• Sense demand in real-time and shape for revenue growth

• Improve agility and react quickly to supply chain events

• Profitably align demand and supply to corporate goals

• Continuously monitor enterprise and supply chain performance

Managing the New Normal

Demand SignalManagement

DemandManagement

Collaboration andVendor ManagedInventory

PlantScheduling and Monitoring

OrderPromising

Service PartsPlanning

Trade PromotionManagement

Supply and DistributionPlanning

RiskManagement

Sales and OperationsPlanning

PerformanceManagement

Single source of truth

Value Chain Planning excels in Semiconductor

Industry Challenges• Demand volatility• Difficult coordination of supply chain execution• Latency and variability in decision making• High risk of product obsolescence

VCP Benefits• Comprehensive integrated planning suite enables

timely, consistent, fact based decision making• Demantra provides best in class forecast accuracy

to reduce impact of demand volatility• Rapid “What-If” scenario planning enables well

coordinated response to supply chain events• Maximize profitability with integrated, collaborative

Sales and Operations Planning• Reduce “perceived” lead time while minimizing

product obsolescence with Inventory Optimization • Advanced Planning Command Center provides

ability to balance short term requirements with long term business objectives

• Reduce time and increase consistency of NPI “ramp to volume” to deliver in the “sweet spot” of market window for maximum profitability

• Relentless pressure on margins, customers expect more powerful products at lower costs

RapidPlanning

FACTORS ENABLING ATTAINMENT OF PRIMARY BUSINESS GOALSWhich of the following are you looking to accomplish as a result of your S&OP? Percentage of Survey Respondents

Companies are Turning to S&OP to Reduce Costs while Maintaining/Improving Customer Service

• Overall the recession has prompted 63% of companies to consider changes to their supply chain networks

• Greatest focus of S&OP on cost and inventory management, and on improved customer service levels

• Overall, 60% of companies view S&OP as more important this year than last (vs. 3% claiming it’s less important)

52%

50%

49%

46%

43%

41%

39%

36%

35%

35%

30%

29%

22%

19%

35%

Improve inventory optimization

Cut costs without reducing customer service

Improve forecast accuracy

Gain better balance of supply and demand

Improve customer service

Increase profits

Ability to make more changes/Be more flexible

Reduce lost sales opportunities

Minimize out-of-stock situations

Minimize risks

Provide real-time visibilty into the supply chain

Improve ROI on assets

Improve customer retention

Produce/Introduce new products

Greater network optimization

Source: “Recession Survival Kit; cross-industry survey conducted for Supply Chain Management Review, on behalf of Oracle and IBM, by Reed Business Information; February, 2009. Response to question: “Which factors will enable your organization to achieve your primary business goal?” n = 430 responses.

Best Practices S&OP

• Often owned by supply chain group with limited involvement by others

• Focused on balancing supply and demand

• Too much focus on explaining the past

• Standalone process not easily integrated with operational planning and execution

S&OP as Typically Implemented

• Owned and driven by executives, and a cross-functional and highly interactive and iterative process

• Focused on meeting overall operating goals including financial goals, such as revenues, costs, and profits

• Forward looking based on predictive analytics

• Monitoring of operating performance linked with planning processes allowing companies to drive decisions into operations

Best Practices S&OP

© 2010 Oracle Corporation – Proprietary and Confidential

Integrated Business Planning (IBP)

Typically, planning is done at department level. Often depends on emails/spreadsheets to bridge siloed planning systems. Finance sets revenue / profit goals without validation from Mfg (i.e., resources, capacity to meet goals.)Mfg balances demand / supply with little visibility to whether resulting “plan” will be meet budgets on which the company’s revenue and profit goals are based. Sales commits to meet revenue goals without complete understanding of what Mfg can deliver.

DISCONNECTS / GAPS ACROSS DEPARTMENTS AND ENTERPRISE

KEY CHALLENGES

Oracle IBP bridges gaps by integrating financial planning with operations planningRevenue goals and budgets validated against a bottom-up operating plan thro’ S&OP. The operating plan is reconciled against financial goals from Hyperion Planning.

Detailed changes to the plan can be immediately see the big picture impact of the changes. Significant differences between the current plan and goals can be escalated to Executive Team for resolution.

Addresses one the CFO’s big concerns—the reliability of the revenue forecast. In Oracle S&OP, plans are updated daily or weekly from a precise forecast based on current market conditions. This updated plan is published to Hyperion Planning so that financial analysts are working with data that best represents what is going to happen – not what they projected would happen based on last quarter’s data.

The whole company is operating to one, current and accurate plan. Company executives have the critical information they need to make the right business decisions.

The “reconciliation process that closes the gap between [business] strategy and operations.” (Gartner)

Oracle Addresses the Entire S&OP Process

Most S&OP software

applications are limited to

enabling high level S&OP

process

Only Oracle links monitoring with

supporting planning applications to drive

decisions into operations

S&OP detailed analysis and simulation

Product Planning

Supply Planning and Simulation

Financial Planning

Demand Management

Supporting planning processes

Executive Review

Demand Review

Supply Review

Financial Review


Oracle’s Complete S&OP Solution

• Interactively engage management• Move from a periodic reactive to a real

time, iterative and proactive process– Reduce cycle time and improve alignment by automating

the consensus process– Profitably balance supply, demand, and budgets

• Drive decisions into operational planning and execution, and monitor performance

• Start quickly with best practice templates and easily adapt to your business – evolve at your own pace

Start anywhere, progress at your own pace

Finance(Hyperion)

Supply(ASCP, RP, SNO,

IO)

Product(Agile)*

Demand(DM)

Executive S&OP Dashboards

Detailed planner workbenches

Real-Time S&OP

* Integration planned for future

S&OP

Demand

SupplyTrade

Finance

DesignRisk


Dashboards Offer Visibility Across S&OP Process


Pre-Configured Views Accelerate Time to ValueMore than 300 KPIs to Choose From

• Executive Summary• Top Difference –

Operating Plan and Budget by Category

• Consensus Change by Customer

• Consolidated Analysis• Profit and Loss Statement• Constrained Forecast

Comparison• Budget Analysis• KPI reports: Forecast

Accuracy; Customer Service; Inventory and Production

Executive Review Tab

• Demand Summary• Top Absolute Difference –

Consensus and Budget by Category

• Consensus Change by Customer and Category

• Forecast Comparison• Forecast Accuracy

(MAPE)• Projected Backlog• Consensus Tracking• Forecast Scenario

Comparison

Demand Review Tab

• Supply Summary• Bottom Demand Fill % by

Customer• Supply Change by

Category• Consolidated Analysis• Demand Fill• Production Plan• Production Plan by

Organization• Top Resource Utilization

by Organization• Top Resource Utilization• Top Supplier Item

Utilization• Consolidated – Scenario

Comparison

Supply Review Tab

• Financial Summary• Operating Plan and

Financial Forecast Comparison

• Top % Difference -Operating Plan and Budget by Category

• Margin Difference by Category

• Year-over-Year Financials• Financial Forecast and

Budget Comparison• Revenue / Cost / Margin

by Category / Organization / Zone / Customer

Financial Review Tab

Note: Above highlights just a sample of the available pre-configured views in each tab

Drive Decisions into Operational Planning

Executive S&OP Dashboards • Enable key managers to continuously monitor S&OP performance

• Evaluate alternative business scenarios

• Power users can leverage direct links to RTS&OP to perform detailed analysis and simulation

• Approve and drive into execution with direct linkage into tactical and operational planning processes

• Supported by best in class product to sense and shape demand, and perform supply simulation

Demand Supply Finance

Business scenarios

Assignedactivities

Planners execute assigned activities

Suggested alternatives

for evaluation


Solution Spans Strategic, Tactical, and Operational Issues

Operational Events

Tactical Decisions

Strategic Decisions

• Track orders • Track shipments• Alert issues

• Balance capacity• Rebalance

inventory• Allocate products• Shape demand

• Service levels• Inventory policy• Carrier contracts• Product mix• Supply network

sourcing

Continuous S&OP Process Execution

Connect Finance and OperationsChallenge: misalignment between financial and operational plans

Financial Planning– Financial plans do not reflect

operational realities– Revenue forecast is unreliable as it

not adjusted to reflect operating forecast

– Strategic financial plans lack bottom up validation

– Financial planning uses discrete periods and looks backwards

Sales and Operations Planning– Operating plan not directly aligned to

financial targets– Impact of demand and supply changes

not visible to finance– Operating plan has little top-down

validation and decisions made without considering financial impact

– Operating plan is continuous and forward looking

Integrated Business Planning

* Coming in Demantra 7.3

Leverage AIA-based integration to Hyperion Planning* for financial reconciliation

Revenue less thanexpected

Publish Financial Plan to Demantra Assess supply

constraints

Publish consensus revenue, promotion expenses and COGS

to Hyperion

Simulate adjusted or new promotion toIncrease revenue

Why Oracle Integrated Business Planning

Replace manual, intermittent, and disconnected process with a continuous, interactive, holistic Integrated Business Planning process

Validate revenue goals and budgets against a bottom-up operating plan thro’ S&OP

Reconcile the Operating Plan with financial goals

Inject operational reality into Financial Plans

Eliminate CFO’s big concern — deliver a reliable forecast

Ensure financial viewpoint is embedded in the Operational Planning process

Quickly examine alternative scenarios and evaluate financial impact of decisions

Deliver executives the 360-degree visibility to make the right business decisions

Operate the whole company based on one, current and accurate plan

CUSTOMER PERSPECTIVEWe wanted to choose a player that would be in the game for the long haul, so we looked at Oracle's investment in the outsourcing model and its expertise in technology. Simply put, Oracle provides us with the best technology available.”

- Tim Roessler ,CIO

User adoption happened very quickly, almost automatically, we were surprised how easily it went with no complaints from the field.

- James Dillon, Director Global Sales Operations and Customer Service

COMPANY OVERVIEW• Develop, manufacture and market high performance Chemical

Mechanical Planarization (CMP) polishing slurries for advanced semiconductor devices

• #1 Supplier of CMP Slurries — Cabot Microelectronics believes it has approximately three times the annual revenue of the next largest CMP slurry competitor

• Industry: Chemicals • Employees: 1000 • Revenue: US$500M

CHALLENGES/OPPORTUNITIES• AsiaPac customers increased to 71% in 2007 from 53% in 2002• 70% market share through technology leadership• CMP is an enabling technology• One of the fastest growing sectors in the semiconductor industry• Track record of profitable growth, despite semiconductor cycle• Pursuing multiple new market and product opportunities - acquisitions

SOLUTIONS• Demantra DM and RTSOP• Advanced Supply Chain Planning/CBO• Inventory Optimization• Global Order Promising• Hyperion Planning• All deployed OnDemand• OPM backbone

RESULTS• Reduced Monthly forecasting cycle 48% from 21 to 11

days• Reduced Forecast error (MAPE) from 50% to 20%

and falling• Full enterprise planning solution with Hyperion

integration• Enabled live on-line consensus ability• Saved $2-$4 million in hardware and facility expenses

(on demand)• Saved $1 million in compensation costs (on demand)• Improved employee morale

Cabot Microelectronics Integrates Value Chain Planning with Hyperion

What Semiconductor Customers are Achieving with Oracle’s Value Chain Planning Solutions…

Increased on-time delivery to 90% and improved manufacturing planning by 50%

reduced inventory levels 40% & time-to-market 30%

increased supply chain response time by 92%

reduced raw material inventory by 17% and improved efficiency per buyer by 25%

Improved the order-promising automation by 600% and increased the On-time-Delivery to 98%

• Demand Management• Sales & Operations Planning


Customer Fulfillment – Recent Wins


• Warehouse Management• Transportation Management


• Supply Chain Planning

Internal Only

Emerson Real-Time Sales & Operations Planning

SOLUTIONS• Demand Management• AF&DM• RT S&OP • ASCP/CBO• IO• GOP• Hyperion

COMPANY OVERVIEW• Emerson is a diversified global manufacturing & technology

company offering a wide range of products & services in the areas of process management, climate technologies, network power, storage solutions, professional tools, appliance solutions, motor technologies, industrial automation.

• Revenue: $24.8B• 140,000 Employees• 265 Manufacturing Sites

CHALLENGES/OPPORTUNITIES• Decentralized and non-formal S&OP Processes• Manual & inconsistent forecasting process across sites.• Difficulty measuring forecast accuracy :SKU & Piece Part• Forecasting performed qualitatively, without a solid

statistical basis for decisions.• Multiple Master Schedulers for the same product group;

difficult to get global roll up view• Communication of forecast decisions within and across

sites was sporadic and typically not timely• Each site is on a different legacy system• Lack of Forecast ownership: Marketing & Sales provide

dollarized annual amount as forecast• Lack of Global Visibility• No Bottoms up fcstng & reconciliation to upper levels

RESULTS• Single Global Master Scheduler per

Product Line• Centralized Planning Process for

Collaboration and Consensus.• Demand Capture at Model and

Options level for Independent and Dependent Demands

• Integrated Planning Process for the entire ‘Model Option Tree’

• Enhanced Service Levels, Superior Forecast Accuracy

• 43% reduction in Inventory

Month 2008

VTech Builds a Consumer Driven Supply Chain with Oracle

CUSTOMER PERSPECTIVEDemantra's solution allows us to collaborate with our customers in a single, consistent planning environment where changes in forecasts dynamically update replenishment and shipment plans. This next generation CPFR solution allows VTech to maintain its lead in the consumer electronics business by delivering the highest possible service levels, while reducing current inventory levels.

- Nick Delany, Senior Vice PresidentVTech Telecommunication Products Business

COMPANY OVERVIEWVTech is one of the world’s largest suppliers of corded and cordless phones and a leading supplier of electronic learning products. Founded in 1976, VTech manufacturers innovative, high quality consumer electronics products, and distributes them to markets worldwide in the most efficient manner.

RESULTS• Increased order fill rate from 55% to over 95%• Increased inventory turns from 3x to 6x per year• Reduced logistics costs by 65%• Reduced retail compliance fines by 85%• Reduced price protection claims by 40%• Rapid time-to-benefit with implementation in 90 days

CHALLENGES/OPPORTUNITIES• Legacy systems a hodge-podge of incompatible

hardware and software• Inefficient planning and execution leading to rising

costs• Excess inventory; poor response to market

requirements

SOLUTIONS• Real-time Sales and Operations Planning


“To advance our successful business process transformation, we leveraged best-in-class technology from Oracle, as well as industry best practice expertise from Oliver Wight. Together, Oracle and Oliver Wight have enabled us to transform our planning systems to next-generation sales and operations planning that support significantly improved decision making.”

Randall WoodVice President, Leggett & Platt

Oracle and Oliver Wight Work Togetherfor Success at Leggett & Platt

Achieving Next Generation S&OP is a JourneyOliver Wight S&OP Maturity Model

Mature Integrated Business Planning• Drives responsive optimization of the business in pursuit of business strategy• Continuous Reconciliation, managing gaps and alternative scenario planning

Integrated Business Planning• Rolling business management process including gap analysis versus strategy and focus on

competitive priorities• Integrated Reconciliation is the driver: business analysis provides underlying understanding, drives

improvement priorities and gap closing actions • Process frequently reshapes to meet changing organizational structure• Used to deploy and drive the value proposition

Capable S&OP• Process is established driving integrated operational and financial planning• Full suite of KPI’s to drive operational effectiveness, achieving 95%+ capability • Issues are identified and this is the decision making process• Annual budgeting process removed – S&OP numbers drive forward plans• Team working behaviors are demonstrated throughout the process

Foundation S&OP• All elements defined with correct accountability, KPI’s and structure• Focus is demand /supply tactical balancing• Initiate integrated supply chain KPI’s• Challenging behaviors but not yet working

Disconnected Management Processes• Traditional management meeting focused on the past• Annual budgeting process with poor basis for forward projections • Functional/silo management – few/unaligned objectives & measures• Defensive functional behaviors

Note: Model courtesy of Oliver Wight

Phase 1

Phase 2


SummaryHow Oracle Enables Next Generation S&OP

5-Step S&OP ProcessManagement

Review

Product Review

Demand Review

Supply Review

Financial Review

Supporting Planning Processes

• Supply Planning• Long-Term Capacity Planning• Financial Planning

• What-If Simulation• S&OP Process Management• Demand Management

• Performance monitoring integrated with planning applications so that decisions can be driven into operations

• Aligns value chain planning and operations with strategic financial plans and budgets

• Built-in forward looking analytics so executives can see where the business is heading and make informed decisions

• Rapid, robust, constrained and profit-optimized "what if" capabilities to enable event-driven S&OP

What Analysts are saying

Oracle rated a Leader in Gartner’s Magic Quadrant for Supply Chain

PlanningProcess Automation

Gartner:MarketScope for Supply Chain Planning: Process Automation, 2009By: Tim PaynePublished September 3, 2010

The Magic Quadrant is copyrighted September 3, 2010 by Gartner, Inc. and is reused with permission. The MagicQuadrant is an evaluation of a marketplace at and for a specific time period. It depicts Gartner's analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the MagicQuadrant, and does not advise technology users to select only those vendors with the highest rating. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

Note: “This MagicQuadrant graphic was published by Gartner, Inc. as part of a larger research note and should be evaluated in the context of the entire report. The Gartner report is available upon request from Oracle.”

Leaders•Have multi-industry domain expertise•Full offerings covering the entire supply chain•Offer a upgrade path for users•Have evolving strategies to meet emerging requirements

Oracle Sales & Operations Planning Meeting

Steve Zadig

11‐18‐10

Steve Zadig, background

• Avowed Start‐up Junkie• 40 years of experience in Semiconductor Industry Engineering and Operations• Core competency is start‐up to IPO stage

– Build teams– New Product Development– Establish scalable infrastructure

• 2 of 3 fastest growing private companies in semi history

Steve Zadig, con’t

• 3 IPO’s (would have been 4 had it not been for the 2008 Global Economic Crisis)

– C‐Cube Microsystems

– Paradigm

– Marvell

– Telegent (should have gone spring ’09)

• Principal founder of the Fabless Semiconductor Association (now GSA)

• Advisory Board Member (SiTime, Clariphy, NewCo)

Start‐up lifecycle

• Idea / formation• Engineering / business development phase• Revenue begins

– Simple finance controls in place– Formal Operations started

• Revenue grows– Higher level of control required– Strategic infrastructure growth planning required– QuickBooks no longer sufficient – Midsize or Big Box?

Define, Design, Build, Sell (Business 101)

• Define– What is your business (regional, global?)– How big and how fast will it grow?– What business processes to you need to support?

• Finance (# of Orgs, currencies, reporting)• Ops (Supply Chain, Costing, B2B)• Sales (CRM)

– What is your confidence level / budget to support tools?

– Vendor selection• Big box? Mid‐size?• Implementation support• timeline

Define, Design, Build, Sell

• Design Phase– What are your business processes? (now / later)

• KISS (Keep it simple stupid! It will get more complex)• Minimize customization (upgrades will kill you)• Minimize mix and match systems

– What are your current and future requirements?• Financial accounting / reporting• Vendor management / cost accounting(OSFM / B2B?)• Part numbering / Marking / traceability • Integrated Purchasing (iProcurement)• ASCP• CRM• Doc Control

Define, Design, Build, Sell

• What is your internal resource commitment?– You must feed the beast or it will eat you!

• Selection of Implementer– Business experience / matched resources– Long term support / offshore back office– Schedule / ‘go live’ expectations

• Build out (resource, resource, resource)• In house expertise• User training (adequate support?)• Testing or jump and learn to fly?

Define, Design, Build, Sell (run)

• O.K., you’ve gone live and survived, now what?

• More functionality (return to Define)– Upgrades / new functionality /requirements

– Productivity enhancement / utilization

– Training

– Offshoring

Telegent – case study

• Offshore Business model• Watching costs – QuickBooks early on• Revenue business complexity exceed early expectations• Oracle and USJade selected October ’07• OSFM added in November (real time costing)• ‘Go live’ end of January ‘08• Fiscal year end March 31st ‘08 completed with zero issues• B2B goes live August ’08 – 99% transaction accuracy, OTD >99%• 3 Day Financial closes the norm• Operational closes with near zero variances by 5 pm US time on last

day of Quarter. Near perfect inventory reconciliations • iProcurement implemented early ’09• Seamless upgrade to 12.05• ASCP implemented FYQ1’10

Lessons learned

• Understand your business• Implement ERP Systems earlier than later

– Changing horses mid‐stream can be very painful– Vendors offer pay as you grow support models

• Choose your Implementation partner carefully– Like a marriage, you will be together for a long time and divorce can be painful

• This is an investment, you get what you pay for• There is no free lunch, do the work

Sales & Operations Planning:Tool or MIA?

Oracle Executive Power BreakfastNovember 18, 2010

Mel Nelson, CFPIM, CIRM, CSCPM.N. Nelson & Associates, Inc.

M.N. Nelson & Associates, Inc. 2

Symptoms of S&OP Problems

• High level of late shipments/backorders

• High volume of orders that do not allow enough lead time

• Inventory imbalance / excess

• Shipments heavy at month end

• Finger Pointing


Our S&OP Journey

• What is Sales and Operations Planning• Basics of How to Make it Work• The 4 Necessary Steps


Our S&OP Journey

• What is Sales and Operations Planning• Basics of How to Make it Work

• The 4 Necessary Steps

– Recommendation1. Take Some Notes2. Make it Work Back at Work

The Monthly 4 Step S&OP Process

M.N. Nelson & Associates, Inc.

Run MonthEnd Reports

End of Month

•Statistical Forecasts •Field Sales Worksheets

ExecutiveS&OP

Meeting•Decisions •Authorized

Game Plan

Pre-SOPMeeting • Recommendations &

Agenda for Exec Meeting• 3rd-pass spreadsheets

(consensus, alternatives, what-ifs)

DemandPlanning • Management Forecast

• 1st-pass spreadsheets(with new forecast)

SupplyPlanning • Capacity constraints

• 2nd-pass spreadsheets(with new production plan)

Step 1

Step 2

Step 3

Step 4


Planning & Scheduling

Disconnect

Strategic Planning

Business Planning

6

WE THINK OUR

MASTER SCHEDULERS

KNOW WHAT THE HELL THEY’RE

DOING !


Strategic Planning

Planning & Scheduling

Business Planning

Sales & OperationsPlanning


Resource Planning Model

Business Planning

Strategic Planning

FOR

EC

AST

& D

EM

AN

D M

GM

T.

VolumeSALES &

OPERATIONS PLANSalesPlan

OperationsPlan

CA

PAC

ITY

PLA

NN

ING

SupplyDemand

MixMaster Scheduling

Detailed Planning &Execution Systems:

MRP, Plant Scheduling,Supplier Scheduling, etc.


S&OP

MPS

MRP00000’s

000’s

10 - 20 Product Families

End-Items

Discrete Items

Sales & Operations Plan


MPS - End Products (Mix & Modular)CRT (Name Brand/Generic)

25 Possible ModelsModel #1Model #2Model #3, etc.Generic Models

Containers (Generic/Name Brand)DrumsPlastic TubesBottles GlassBottles Plastic

Product Lines ($)CONTINUOUSDISCRETE

TELEVISIONS, Refrigerators

S&OP - Product Families (Rate)

CONDIMENTS, Frozen Foods

CRTPlasma/LCDRear Projection

Ketchup Flow Line

The Executive S&OP Meeting

• Sales/Marketing (Forecast & Safety Stock)

• Finance (Dollar Guidelines)

• Operations (Current Production, Maximum Production and Ramp)


YOU CAN GET A LOT FARTHER WITH A

KIND WORD AND A GUN

THAN YOU CAN WITH A

KIND WORD ALONE

…AL CAPONE



Current FutureDec Jan Feb Mar Apr May Jun Jul Aug Sep

ForecastBeginning InventoryEndingInventoryProductionPlan

Product Family 101

Firm Orders and Forecast Demand

Forecast Demand and Personnel Planning

Forecast Demand and Capital Planning

Mktg/Sales: 40 Safety Stock plus the Forecast

Finance: Never more than 65

Production: Current O/H: 40

Maximum: 55

Ramp: 5



Forecast 40 40 45 50 70 40 40 40 40 40Beginning Inventory EndingInventory ProductionPlan

Product Family 101







Forecast 40 40 45 50 70 40 40 40 40 40Beginning Inventory 40 40EndingInventory 40 Production Plan 40

Product Family 101







Forecast 40 40 45 50 70 40 40 40 40 40Beginning Inventory 40 40 45 50 55 40EndingInventory 40 45 50 55 40 40ProductionPlan 40 45 50 55 55 40

Product Family 101






Resource Requirements Plan

Tolerance = plus or minus 7%

Fam 1 Fam 2 Fam 3 Fam 4

Total Hrs. Capacity Required

Hours Demonstrated Capacity

Res 1 350 120 70 300 840 780

Res 2 160 300 800 175 1435 1800

Res 3 200 75 175 200 650 700

Res 4 220 50 100 250 620 310

Res 5 50 60 55 100 265 250

Period: July


WHAT THEY DO• Sales & Operations Planning: balances demand and

supply at the aggregate, volume level

• Master Scheduling: balances demand and supply at the detailed, mix level

• Sales Forecasting: provides future demand information to both S&OP and Master Scheduling


Trilogy of Integrated Activity

Sales & Operations Planning

Sales Forecasting

Master Scheduling


Demand Planning

Any Independent Demand Item

• Family Forecast• Option Forecast• Spares and Service Parts• Engineering Requirements• Promotional Demands• Inventory Build-Aheads

The Supply Planning Process1. Develop New Production Plan

2. Translate New Production Plan:- from product families to resources- from units of product to units of workload req’d

3. Compare required workload (demand for capacity) to demonstrated capacity (proven supply of capacity)

4. Adjust where necessary and practical

5. Where not practical, elevate to Pre-SOP Meeting


S&OPReview

Resources

Performance

Measurement

DemandPlanning

SupplyPlanning

FinancialReview

StartHere

Process Inputs Organization

• Volume and Mix Forecast

• Verification of Release

• Capacity / Capability

• Financial Resources

Sales and Marketing

Engineering

Manufacturing

Finance

Process Outputs Organization

• Sales Plan

• Design Accountability

• Rate of Production

• Financial Plan

• Backlog Projection

• Inventory Projection

Sales and Marketing

Engineering

Manufacturing

Finance

General Manager

General Manager

Action plans at an appropriate time to keep demand & supply in balance.

The Result?

Sales and Operations PlanningMonthly Meeting

Directors


The Monthly 5 Step S&OP Process

Run MonthEnd Reports

End of Month

•Statistical Forecasts •Field Sales Worksheets

ExecutiveS&OP

Meeting•Decisions •Authorized

Game Plan

Pre-SOPMeeting • Recommendations &

Agenda for Exec Meeting• 3rd-pass spreadsheets

(consensus, alternatives, what-ifs)

DemandPlanning • Management Forecast

• 1st-pass spreadsheets(with new forecast)

SupplyPlanning • Capacity constraints

• 2nd-pass spreadsheets(with new production plan)

Step 1

Step 2

Step 3

Step 4


Benefits of S&OP

• Higher Customer Service• Lower Finished Goods Inventories• Shorter Customer Order Leadtimes• More Stable Production Rates• Less Unplanned Overtime• Higher Productivity

Top Management’s Handle on the

Business

About USJade

A Complete Solutions Provider• Enterprise System Integrator• Served more than 50 customers for over 10 years• Rigorous Staff Certification Process

• Platinum Oracle Certified Accelerate Solution Provider

• Strategic Partnerships

• Experience with Global Implementations

• Global Delivery Capability – US, India, China, Israel

• Right Shore Delivery Model

• Right Size

• SAS 70 Type II Certified

© 2010 USJade Corp. www.usjadecorp.com 408-899-7212

http://www.usjadecorp.com/

Delivery Model

We Deliver Faster, Better, and more Economically

• Planning

• Assessment

• Strategy

• Architecture

• Requirements

• Design

• Pilots

• Training

On-Site

• Prototyping

• Proof of Concept

• Development

• Testing

• Conversion

• Maintenance/Enhancement

• Support

Offshore


Pune, IndiaSan Jose, CA

Boston, MA Beijing ,ChinaTel Aviv, Israel

Delhi, India


Complete IT Solutions

Robust State-of-Art Infrastructure

Large Depth of Technical Competencies

Transform Domain Knowledge into Industry Leading Solutions

Partner in Executing Customer’s Growth Strategy

Mergers & Acquisitions

Process Improvement

Industry Specific

Portfolio Management

Enterprise Roadmap

IT Strategy

Systems Integration

Gardian™ Hosting & Managed Services

Business Process Outsourcing

Application Management

Services

Business Continuity & Disaster Recovery

Business Intelligence

Packaged Solutions

Web Technologies

Upgrades and Patching

Assurance Services

Solution Center

Knowledge Library

24X7 Delivery Capabilities

SAS Certified Operations

Alliances and Partners

Global Service Delivery Model

RDBMSMiddlewareTechnology



Some of our Customers



Upcoming Events: usjadecorp.com/events

December 9th: “SOA Case Study: How Silver Spring Networks Stays Connected to Their Supply Chain” (webcast)

December 16th: “Transform Your Planning Process with Oracle ASCP” (webcast)

Any Time: Complimentary Personalized Workshop on Oracle Planning (contact us to schedule)

Rosan [email protected]

mailto:[email protected]

oracle & usjade power breakfast presentations: sales & operations planning

Technology

operating

chain planning

oliver wight

operating

capital planning

operations

op process

drive decisions