Article

Sales is an indispensable player in the S&OP process as it has direct customer contact. It therefore provides valuable information about market trends as well as customer wishes and requirements. This information is crucial for demand planning. Sales not only knows the current orders, but also has insights into future order developments and market trends, which should be incorporated into demand forecasts. If the Sales department provides precise and timely input on the demand signals and is actively involved in validating planning figures, the company can optimally control its production and supply chain processes. In this way, excess stock can be avoided while also preventing supply bottlenecks.         

A reliable demand forecast is therefore the key to avoiding planning errors. It makes a significant contribution to increasing the efficiency of the entire value chain.

Particularly in times of bottlenecks—such as supply bottlenecks, raw material shortages or unexpected production disruptions—it is essential that the product or customer prioritizations decided in the S&OP meeting are also fed back to the Sales department and ultimately to the affected customer segments. These prioritizations are often based on strategic corporate decisions. They determine to which customers or products, in critical situations, resources are allocated and who receives preferential deliveries. Sales must receive this information in order to be able to respond to customer inquiries and manage them professionally. This not only contributes to customer satisfaction, but also avoids internal conflicts of objectives and misunderstandings. Transparent information flows between departments ensure that everyone involved pursues the same target figures and that Sales staff proactively offer solutions that are in line with the overarching corporate strategy.      

Clearly structured information flows and the transfer of agreed S&OP decisions back to Sales enable integrated planning and the promise of reliable and capacity-adjusted quantities in the direction of the market.

Another key aspect of the link between S&OP and sales planning & management is the integration of product and portfolio planning into the S&OP cycle. New product introductions (NPI) or product phase-outs, in particular, generate important information that Sales must take into account. When new products are introduced, Sales must be informed at an early stage about the launch schedule and product availability depending on the ramp-up of production volumes. Based on this information, they can develop targeted sales strategies and manage customer requirements accordingly. The same applies to the discontinuation of products: Here, the Sales department needs to know when products will no longer be available and how final stocking is planned. This enables them to present alternative offers in good time. This is particularly important with regard to long-term customer relationships and contract negotiations.       

Close coordination with these processes enables the Sales department to act flexibly and in a customer-oriented manner, while, at the same time, the company ensures streamlined and efficient portfolio management.    

The three core aspects outlined above clearly show that linking sales planning with the S&OP process is not only a basic prerequisite for the effectiveness of this process. Rather, the Sales department itself can also derive significant benefits for its internal planning processes and the sales management based on them. The positive influences include higher decision-making quality on the planning side, more effective order management, and ultimately increased customer satisfaction.

Dombrowski, D. /  Tödt, S.