Staying two steps ahead: how leading companies use cloud-based integrated business planning solutions to outperform their peers  

Companies today face the tremendous challenge to plan complex and often global, multi-level supply chains. Across different products, markets, profit centers and planning horizons, companies strive to serve their demanding customers and outperform competitors. The challenge includes the attempt to balance production capacities, optimize inventories and improve service levels. This comes along with pushing new products to the markets with shorter lead times than ever before, while managing marketing campaigns and keeping up with the annual operating plan.

Even though such business challenges might not have changed for you lately, the potential response for you and your competitors surely has. New processes and tools have evolved to harness multi-level process structures, manage timelines, orchestrate both heterogeneous IT systems and a unique and diverse organization. Unleashing cloud potential seems to be similar to entering the smart phone area, which allowed for real-time communication and all kinds of mobile computing. Cloud-based disruption to every part of your business is now closer and more promising than ever, as you can enable your organization to increase resource utilization for storage and transport, optimize working capital, increase conformity and reliability of budget and overall improve accuracy and efficiency of your planning process. Our experience shows, that significant improvement potential can be leveraged particularly in the areas of Sales, Finance and Operations (see figure below).

We have unleashed this potential together with clients from various industries by sharing our vision and tool experience.

Lift your company to the next level of Integrated Business Planning

Our vision…

Supply chain planning has been evolving from a reactive approach to Sales & Operations Planning (S&OP) integrating more business areas towards the vision “One Company. One Plan. One Number”. S&OP shaped the planning landscape in the early post-millennium area. Today, with Integrated Business Planning penetrating the market, this evolution continues and enables forward-thinking companies to translate strategic directives into feasible, operational targets. In our view, IBP offers three main benefits:

Planning Process Orchestration: Our experience shows that well defined timelines and alignment processes are the foundation and yet the weakest link in today’s planning processes, because mastering Planning means mastering your organizational processes and real-time collaboration. Fully cross-organizational alignment is a mandatory prerequisite for successfully orchestrating Management, Finance, R&D, Marketing, Sales and Operations. This has to be supported by very flexible processes, meaning to take different levels, numbers and views of interest into account.

Volume and/or Value Optimization: Standard S&OP processes follow a two-step approach. First, an iteration to a sound and operationally feasible supply plan. Second, the financial analysis of this plan and readjustments in order to match financial targets. With IBP bridging the gap between volume and value based planning, both components can be optimized simultaneously, resulting in often eye-opening insights, e.g. into portfolio planning or the effects of promotions.

Visibility Increase: Crucial for successfully managing the digital age is transparency on information and visibility of areas of improvement. For this purpose, leading IBP solutions come with a powerful toolset that support root cause analyses for past events, scenario-based decision making in daily business with actual numbers, and what-if analyses for planning the future company development.

…empowered by digital tools

Thought leaders heavily invest into getting their processes digital. Fully digitized planning and analytic platforms, used by well-trained planning experts are key factor for managing an often decentralized organization and will be state of the art for handling strategic, tactical and operational alignment. This new vision can only be realized with three fundamental digital technologies that are just about to launch a new age.

Cloud technology: Cloud-based planning solutions fulfil your demand for scalable solutions. They offer both performance scalability, to serve a developing business volume, and functional scalability, to apply newly released algorithms, reports, data sharing apps or a growing number of add-on tools as they are launched into the market.

Real-time data: Volatile business environments demand fact-based decision making. Access to real-time data at the required level of granularity enables stakeholders to capitalize on business opportunities as they appear and to react to unforeseen challenges in time. Enhanced usability and support of mobile solutions are enablers that support accelerated data gathering, analysis and decision making.

Data analytics: Deducting the right insights from historical data is essential to control your future business. Analytic engines that are built into leading planning solutions enable rapid data analysis, visualization of the current state and leverage machine-learning functionality: By learning from previous forecast errors, prediction of future irregular events becomes more of a day-to-day business and enables you to continuously improve your forecast accuracy.

In our next post on Integrated Business Planning we will focus on success factors for an aligned finance and demand planning. In case you want to find out more already, don’t hesitate to contact our planning experts.

Authors


Markus Bornfleth
is the senior expert for IBP in Capgemini Consulting’s Supply Chain Planning practice within DACH and focuses on bridging the gap between financials and supply chain planning.

 


Felix Maier
is Business Consultant at Capgemini Consulting with focus on our Integrated Business Planning approach and the corresponding tools.