Advancing the Cause of SCM and S&OP Through Advanced Analytics

Supply Chain Management. The words are a freely exchanged coin of the realm. The promise is considerable: an overarching discipline that incorporates all of operations, finance, customers, suppliers, and even research and development as well as critical aspects of sales and marketing into a single scope that ultimately focuses on maximizing the financial performance of the firm. Yet after over 50 years of evolutionary development, reality has fallen well short of expectations: Cross-functional integration is impeded by corporate organizational structures, culture, and inappropriate performance metrics.

Certain processes and tools, most notably sales and operations planning (S&OP), have been developed to address such shortcomings. Yet these have often failed to live up to their promise as well, often due to inadequate decision support technology. This results in substantial expenditures of time and money with little of substance to show for the effort. So, are SCM and S&OP misguided and overrated? Or, is it a matter of not having the right analytics tools and implementation processes?

Those are questions we will explore in depth over the following pages. Before that, let’s be clear at the outset what this article is not about. First, it is not a primer on either SCM or S&OP. That territory has already been mapped by others. Rather, we assume that the reader has a working knowledge of both subjects. It is also not a comprehensive presentation of analytics—advanced or otherwise.

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