Sales and operations planning (SOP) is one of the more critical functions an organization must undertake, as its effects span across various departments, and have the potential to directly influence the organization’s profits. A successful SOP department harmonizes the different beats of each division into an agreeable melody. It is definitely a challenge to find an effective tool that can merge the data from different systems to create a coherent picture of the organization.
An SOP system is used by the most important departments of an organization: finance, sales, marketing, and operations. This is why a powerful SOP system can make the difference between the success and failure of an SOP cycle. SOP systems are very useful to senior management, as they allow a “bird’s eye view” (an overall view) of the health of the whole organization. With its graphical representations and dashboards, an SOP system is an indispensable tool for any organization.
The software market is becoming increasingly competitive, which is having a positive effect on the SOP products available. Today, SOP systems have many advanced features, such as real-time dataflow and intuitive user interfaces. A couple of years back, many features like these were considered “nice to have,” but today they are essential. Also, vendors have streamlined their products so that implementation times are more manageable, making the return on implementing an SOP system more attractive. Today, a typical SOP implementation—assuming that the organization is already running an enterprise resource planning (ERP), supply chain management (SCM), and business intelligence (BI) system—should take around three months worth of labor hours.
Predefined Key Performance Indicators and Metrics
Standard key performance indicators (KPIs) and metrics already built into an SOP system is a particularly useful feature that offers many benefits to an organization. Standard KPIs and metrics could be based on popular models, such as the supply chain operations reference (SCOR) model, and they can drastically reduce the implementation time of an SOP system. Most SOP system implementations take a long time to develop reports based on SCOR-based KPIs, so this capability should be a fundamental feature of any SOP system. If this capability is not supported by the SOP system, then a considerable amount of time will go to identifying KPIs and then building reports for them, be they financial or operational.
If the KPIs on budget, inventory norms, sales forecasting error, etc. are built in, then they do not need to be configured from scratch. Furthermore, a visual representation of KPIs in graphs and dashboards helps top management to keep tabs on various “numbers.”
Integration with Different Systems
An SOP system should be able to integrate with different systems. Most organizations have a transactional system, which is usually an ERP system. Such systems are rich with data that organizations could use to their benefit. An SOP system should be able to draw data from these systems to show a realistic value of the KPIs and metrics through internal benchmarking of their historical data.
An SOP system should also be able to integrate with the SCM system. Integration of these two systems gives organizations the flexibility to modify data in the SOP system if certain organizational objectives are not being met. For example, a sales manager might need to change the sales forecast figure of a certain product in order to meet organizational objectives for that product. With the two systems integrated, instead of logging into the SCM system to make this change, it can be made directly in the SOP system, and the information will be updated in the SCM system as well.
An SOP system should be able to extract data from the BI system, such as historical data and calculated metrics. To do this, the SOP system should be sitting “on top” of the ERP, BI, and SCM systems. It is preferable that the dataflow from these systems is bidirectional, but still today, in some cases, technological limitations severely restrict bidirectional flow. For example, data changed in the SOP system may not be automatically updated in the BI system. For an SOP system to have this capability, it should be built on a platform that can integrate with heterogeneous systems seamlessly. This should be a fundamental feature of an SOP system.
SOURCE:-
http://www.technologyevaluation.com/research/articles/how-to-evaluate-a-sales-and-operation-planning-system-19231/
An SOP system is used by the most important departments of an organization: finance, sales, marketing, and operations. This is why a powerful SOP system can make the difference between the success and failure of an SOP cycle. SOP systems are very useful to senior management, as they allow a “bird’s eye view” (an overall view) of the health of the whole organization. With its graphical representations and dashboards, an SOP system is an indispensable tool for any organization.
The software market is becoming increasingly competitive, which is having a positive effect on the SOP products available. Today, SOP systems have many advanced features, such as real-time dataflow and intuitive user interfaces. A couple of years back, many features like these were considered “nice to have,” but today they are essential. Also, vendors have streamlined their products so that implementation times are more manageable, making the return on implementing an SOP system more attractive. Today, a typical SOP implementation—assuming that the organization is already running an enterprise resource planning (ERP), supply chain management (SCM), and business intelligence (BI) system—should take around three months worth of labor hours.
Predefined Key Performance Indicators and Metrics
Standard key performance indicators (KPIs) and metrics already built into an SOP system is a particularly useful feature that offers many benefits to an organization. Standard KPIs and metrics could be based on popular models, such as the supply chain operations reference (SCOR) model, and they can drastically reduce the implementation time of an SOP system. Most SOP system implementations take a long time to develop reports based on SCOR-based KPIs, so this capability should be a fundamental feature of any SOP system. If this capability is not supported by the SOP system, then a considerable amount of time will go to identifying KPIs and then building reports for them, be they financial or operational.
If the KPIs on budget, inventory norms, sales forecasting error, etc. are built in, then they do not need to be configured from scratch. Furthermore, a visual representation of KPIs in graphs and dashboards helps top management to keep tabs on various “numbers.”
Integration with Different Systems
An SOP system should be able to integrate with different systems. Most organizations have a transactional system, which is usually an ERP system. Such systems are rich with data that organizations could use to their benefit. An SOP system should be able to draw data from these systems to show a realistic value of the KPIs and metrics through internal benchmarking of their historical data.
An SOP system should also be able to integrate with the SCM system. Integration of these two systems gives organizations the flexibility to modify data in the SOP system if certain organizational objectives are not being met. For example, a sales manager might need to change the sales forecast figure of a certain product in order to meet organizational objectives for that product. With the two systems integrated, instead of logging into the SCM system to make this change, it can be made directly in the SOP system, and the information will be updated in the SCM system as well.
An SOP system should be able to extract data from the BI system, such as historical data and calculated metrics. To do this, the SOP system should be sitting “on top” of the ERP, BI, and SCM systems. It is preferable that the dataflow from these systems is bidirectional, but still today, in some cases, technological limitations severely restrict bidirectional flow. For example, data changed in the SOP system may not be automatically updated in the BI system. For an SOP system to have this capability, it should be built on a platform that can integrate with heterogeneous systems seamlessly. This should be a fundamental feature of an SOP system.
SOURCE:-
http://www.technologyevaluation.com/research/articles/how-to-evaluate-a-sales-and-operation-planning-system-19231/
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