Supply chain planning has changed quite a bit since it was first defined. Back then, companies primarily used enterprise resource planning (ERP) systems for collaboration and data tracking across the entire business. Today, many companies do their planning using a mix of spreadsheets and ERP systems. And those options are great and fine for business planning—but only up to a certain point. Why?
Simply, planning in spreadsheets becomes messy and disjointed. For instance, are forecast numbers updated and shared across the business with the relevant stakeholders (e.g., Sales, Finance, Operations)? Are inventory numbers from previous versions of a spreadsheet accurately entered into a new one? What can be done in the event of an unforeseen event in the supply chain, such as a major fire at a key distribution center? Or an earthquake affecting manufacturing processes at a key supplier? What can you do to help ensure that your supply chain planning processes will help meet the company’s overall goals for the year?
The above are just a few questions that those responsible for supply chain planning have to consider. The following is a checklist of items of what we recommend a business should do to have the planning capabilities in place in order to succeed in a rapidly growing global market.
- Make the move to real-time supply chain planning
- Unify supply chain planning with enterprise planning
- Anticipate the demand of the end customer
- Leverage real-time data from all points on the supply chain
- Ensure you have the flexibility to cope with change
When using ERP systems and spreadsheets for planning, companies typically rely only on historical data, resulting in little wiggle room for changes should any disruptions occur in demand or supply. For example, based on the previous year’s numbers, a company can estimate the number of a product it will sell in the next quarter. But what if there’s a massive hurricane that destroyed a key distribution center, leading to too little supply on the shelves? With a real-time planning solution like Anaplan in place that allows you eliminate spreadsheets, as well as complete “what-if” scenarios and their possible impacts on the supply chain, you can plan more effectively ahead of time should such disruptions occur.
A vital second step is to unify the traditionally siloed supply chain planning with sales and operations planning (S&OP) and financial planning. Companies can benefit from synchronizing their short-term operational planning with their wider business planning processes to make real-time updates to inventory forecasts and supply. Deploying real-time solutions that allow for enterprise-wide collaboration means that key stakeholders across the business can create new scenarios and quickly assess how best to use their resources to optimize profitability when an unforeseen event happens.
For consumer packaged goods companies, anticipating the wants of customers and when they want it is an ongoing challenge in supply chain planning. Having a solution in place that allows access to real-time data will give unparalleled visibility into the actual supply chain, but companies should still look beyond their existing network of wholesalers and retailers to sense demand signals from the end customer by using updated market research data and current events as points of information. If you can rapidly identify changing consumer sentiments and assess how it could result in increased or decreased demand for your product, you are benefiting your company (as well as partners and customers) by improving profitability and ensuring products are available when needed.
Because supply chain planning typically involves a myriad of suppliers, channels, customers, and one-off promotions, models can soon become large and potentially unwieldy—particularly when using primarily spreadsheets for planning. Incorporating a solution that uses real-time data allows you to plan with more accuracy and reduces the risk of stock-outs or having too much inventory.
Implementing a solution that gives you the ability to plan and agility to react immediately when disruptions happen along the supply chain allows you to re-plan and compare scenarios in real time—saving you time and money, in addition to increasing profitability.
As we pointed out earlier in this post, many companies still do their planning using a combination of outdated ERP systems and spreadsheets. But as technology evolves and the supply chain becomes increasingly global, companies will benefit from using a platform like Anaplan that allows users collaborate across the enterprise and to quickly adjust to changes in the supply chain to meet business needs.
For more information, see our Anaplan for Operations and Supply Chain apps in our App Hub.