How to succeed with the first 100 days of an S&OP transformation

In today's environment of growing uncertainty, complex global networks, and multifaceted strategic goals—encompassing key elements such as sustainability, customer satisfaction, financial performance, and operational efficiency—sales and operations planning (S&OP) has become an essential tool for translating and anchoring these objectives across the entire value chain.

S&OP transformation should be a top priority on the executive agenda, due to its significant impact to deliver on several key strategic performance parameters, financial and non-financial (resilience, ESG, customer satisfaction, and so on) through transformed ways of working across the value chain.

A successfully implemented S&OP empowers companies to respond swiftly and adapt with agility to evolving conditions, ensuring they remain aligned and focused on achieving their strategic objectives.

To unleash the full potential of S&OP, it must be tailored to the specific needs of the business and its strategic objectives. Adapting S&OP ensures it is equipped to solve the challenge ahead, which may require a complete transformation of S&OP in the business.

Prokura follows three steps toward transformation: conduct assessment, establish governance, and execute transformation.

Assessment: all transformations must start with an assessment of the current tactical planning landscape

Before assessing the current tactical planning landscape, leaders must understand the overall company strategy, which S&OP must deliver against. Recognizing the business’ priorities and targets to be translated into the S&OP process is crucial for the success of the transformation. Only after it is clear how S&OP should support the strategy can the assessment of S&OP in the business begin.

Translating strategic ambitions. Firstly, leaders must align the purpose and objectives of S&OP to the specific needs of the business. S&OP translates the business’ strategic ambition to daily operations; hence it is important to align on which strategic ambitions S&OP is geared to solve. This is especially important in the design of KPIs, S&OP content, and S&OP dialogues in the design phase.

Current state of performance. Secondly, a thorough analysis of the current supply chain performance should be conducted to understand the quality of the existing tactical plans. Assess performance areas such as forecast bias, forecast accuracy, delivery performance, inventory turnover, production efficiency, and so on to understand the quality of the tactical plans and highlight areas for improvement, serving as early indicators for the opportunities that an enhanced S&OP process should cater to.

Current state of S&OP maturity. Thirdly, a maturity assessment of the existing S&OP, tailored to the specific industry requirements, is conducted. This evaluation should focus on three core areas: 1) structure and process, 2) roles and content, and 3) data and tools. The assessment should evaluate these aspects against the level of sophistication necessary for the company and industry, emphasizing that achieving the most advanced S&OP process should never be a goal in itself but rather aligned with what is strategically required.

The maturity assessment will provide a clear understanding of the current state of the S&OP, outlining the areas that require further maturing. The sophistication required from S&OP varies significantly across industries. For instance, pharmaceutical companies often require highly advanced S&OP and tactical planning processes due to the complexity of their operations. Benchmarking against industry standards and understanding the specific needs of the industry, leaders can set a clear and appropriate ambition for what the S&OP process should achieve for the organization.

After completing the steps above, leaders should outline the priorities and initiatives needed to elevate the S&OP to the defined ambition. The prioritization should be based on impact and speed of implementation. A clear road map should guide the S&OP transformation and provide the foundation for critical activities to be undertaken in the first 100 days of the S&OP transformation.

Establish governance: getting ready to transform

Before initiating each improvement initiative identified in the assessment, a clear governance model must be in place, covering:

A)??? Process ownership: a firm alignment on who will run the transformation from the PMO perspective and anchor the process. This person does not need to be the one that will be facilitating the S&OP process after the transformation.

B)???? Aligned roles and responsibilities: clear alignment of roles and responsibilities across stakeholders directly or indirectly involved in the transformation. Driving a successful transformation requires all parties involved to acknowledge their role as a change agent and assume full ownership of their responsibilities.

C)???? Program project plan: a well-structured, prioritized road map detailing the timeline and approach for implementing each improvement initiative. The plan emphasizes closing critical gaps first to accelerate S&OP process improvements. Its aim is to align process efficiency with the company’s strategic objectives and goals.

D)??? Reporting structure: establish a steering committee dedicated to escalation and reporting, ensuring active management involvement and providing an alignment platform. This committee will address challenges promptly, ensuring effective mitigation strategies and momentum of the transformation.

E)???? KPIs for success: establish clear, aligned metrics for measuring success, ensuring each milestone is tied to concrete deliverables. These deliverables should be reviewed and assessed by the steering committee to track progress and maintain accountability.

Transformation: launching the S&OP transformation

Once governance is established, the transformation is ready to launch. A typical S&OP transformation progresses through three key phases: design, build, and implement. Each improvement initiative is managed as a distinct workstream structured around the three phases, with the scope of each phase tailored to the specific requirements of this initiative.

Design phase

The design phase focuses on establishing the foundational design principles or framework for the initiatives to be developed and implemented. It defines the key elements and guidelines to ensure alignment and clarity throughout the process.

Example A: designing the S&OP process. The design phase articulates the core principles of the S&OP process, covering process steps, structure, monthly cadence, governance, and content requirements. Clear design guidelines ensure consistency and alignment with organization objectives.

Example B: establishing system requirements. The design phase formulates detailed requirements for a potential system, addressing aspects such as design interface, user-friendliness, planning components, and IT integration to support the S&OP process effectively.

Build phase

The build phase focuses on refining the established design principles and frameworks, advancing each component to a fully developed state where the solution is ready to be rolled out.

Example A: building the S&OP process. During this phase, the S&OP process is detailed to a level 3-5 process mapping, ensuring clarity and functionality. Meeting agendas, process content, and workflows are finalized, supported by the right quality of data to ensure effective execution.

Example B: building the system. The system or application is developed by a system provider selected to match the requirements to support S&OP. This ensures the solution effectively supports the company’s S&OP with all necessary functionalities and integrations.

Implementation phase

The initiatives are deployed and integrated into the organization and supply chain, ensuring they are effectively adopted, operationalized, and embedded to drive sustainable results.

S&OP is a journey of continuous improvement

Even after the initial 100 days of transformation is completed, there are likely more initiatives to implement. The core of a successful S&OP process lies in its commitment to continuous improvement. A yearly planning cycle must include a thorough assessment of the S&OP process to ensure alignment with the company’s strategic direction. This evaluation helps identify performance gaps and drive targeted improvements, keeping the S&OP process dynamic, relevant, and impactful.

Prokura 9 rules to succeed with an S&OP transformation

1)???? One size does not fit all—tailor the process

Every organization is unique, requiring customized S&OP solutions geared to address the specific strategic objectives of the company. A strong process design starts with a comprehensive assessment of the current situation and maturity.

2)???? Learn to walk before you can run

Understand and accept the organization’s current maturity level. Address the basics before proceeding to advanced topics and remember that maturity is not the ultimate goal—it is a means to meet business needs effectively.

3)???? Change management is key

As Albert Einstein said, “The significant problems we have cannot be solved at the same level of thinking with which we created them.” A strong focus on change management is essential, as transforming the mindset and behaviors within the organization is critical to S&OP’s success.

4)???? Culture plays a large role

Culture is a driving force in any transformation. Establishing a collaborative mindset and a sense of ownership across functions is essential, as S&OP thrives on cross-functional cooperation.

5)???? Have the right competencies on board

Managing S&OP requires a mix of analytical, logical, and facilitation skills. Engaging the right talent both during the transformation and for ongoing process management is crucial for long-term success.

6)???? Implementation is difficult

Transformation takes time, and results won’t materialize overnight. Set realistic expectations by breaking the journey into smaller, achievable milestones with a well-defined road map for improvement initiatives.

7)???? Build a strong data foundation

Reliable data is the backbone of S&OP success. Ensure availability and usability of data for dynamic root cause analysis, effective visualization, and translating insights into actionable decisions that balance supply, demand, and financial impact.

8)???? Good tools are key—but often must be established

If your ERP system lacks adequate tools, leverage readily available options like Excel or PowerBI to support data validation and visualization. Assess the need for obtaining new tools to unleash S&OP’s true potential.

9)???? Just do it—and continuously improve

Don’t wait for perfection—start the transformation and learn as you go. As internal and external environments evolve, ensure the S&OP process remains flexible, adapting to new challenges and opportunities.

By adhering to these principles, organizations can navigate the complexities of S&OP transformation, achieve sustainable success, and quickly meet the company’s strategic objective.

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