Sales and Operations Planning Process for a leading Indian Cement Manufacturer
Title: Designed and Implemented the Sales and Operations Planning process for better supply chain performance
Business Scenario:
- Operations involved selling multiple brands which were transported through a multimode logistics network(rail, road, sea) , either directly to customers or to 200+depots which served the customers
- A very loosely defined non-uniform Sales and Operations Planning process with limited involvement of all stakeholders. Planning done at a very aggregate level.
- Limited visibility and buy-in of the current process outputs. Did not drive the supply chain.
- Incorrect Sourcing decisions(source, mode) to meet demand. Increased logistics costs
- Reduced ability to react to changes in supply chain(e.g.: reallocation of material due to changes in demand over a month). Capacity Constrained Situation. Affected service levels
- Threat from regional players providing superior service levels and entry of MNC’s
Our Solution:
- An integrated and well defined Sales and Operations Planning process was defined and implemented. It involved all the key stakeholders including the Territory Sales Managers, Regional Heads, Zonal Heads and the Central Planning team. It was designed to work at more granular level than before.
- The process outputs were visible to all the stakeholders and a ‘single plan’ was driving the supply chain
- Metrics were put in place to measure the process compliance and output of each stakeholder
- A best source-mode combination was suggested to meet demands depending on minimum and maximum level of demand to be met, the revenue realization from meeting the demand and the logistics costs incurred in meeting the demand
- Granular level of planning(month to days) meant more granular demand picture over a month and a better ability to reallocate material based on demand profiles.
Benefits:
- Existence of single plan and visibility of that plan to key stakeholders ensured better coordination between them. It also ensured better coordination with external stakeholders – plant logistics teams were able to give better visibility to transporters and railways on the requirements, sales team was able to give more realistic commitments to their customers. The sum total of the above meant better customer service levels.
- Logistics Cost Reduction on account of better way to decide on source-mode and more granularity in planning
- Accountability on account of more visibility and metrics framework