SC&B Blog Q4 2023

At the end of each quarter, management sits down and reflects on how exactly their planning and its execution have benefitted the bottom-line revenue of the organization. All the efforts at the boardroom find its jury on how efficiently the stakeholders have managed the demand and supply equation- on how exactly a company’s sales and operation planning benefit the end objective. Whether the goal of building up a scalable supply chain that actively contributes towards a more known brand is being ticked off or not.

Companies and their leadership have proactively started investing in the S&OP platform to harness the virtue for operational betterment and financial profitability. While aligning all processes towards meeting customer demands is essential, one must recognize the marquee advantage of sales and operations planning in its direct influence over collaboration, communication, and the decision-making accuracy a management gets accustomed to. In this write-up, we will highlight the benefits of the S&OP application in the workings of a value chain. The points below further underline the platform’s need in today’s complex business scenarios. Let’s dive right ahead.

• Enhanced cross-functionalities Like many other processes, the supply chain is easily influenced by the domino effect. If the planning is astute and on-point, keeping in mind the factors essential for decision-making, then an enterprise finds itself on the right side of balance sheets. By employing an S&OP platform, a firm witnesses improved integration with various functions at work. Once the top-level management's roadmap is finalized, the sales and operation planning platform allows collaboration and communication channels for fruitful outcomes. This timely collaboration also leaves room for a regular performance review that improves organizational improvements.

• Profitability S&OP's key virtue is that it focuses on long-term planning, thus making a company more proactive in its approach rather than just plain reactive. This makes SCM aware of its resource management in accordance with the plan laid out from an operational perspective. With complete optimization in place, an organization minimizes its probability of errors in its functioning, thus keeping a comprehensive tab on the cost incurred and eventually allowing improved financial forecasting in the time ahead.

• Informed Decision-Making for Product availability Another enablement that S&OP empowers is providing an accurate view of inventory levels present. From a company's point of view that tries to balance the supply and demand of a product for its customers (read: e-commerce platform), sales and operation planning gives constructive insights into managing production and inventory levels. This helps stakeholders avoid supply chain blues such as overstocking, understocking, and excessive raw material procurement.

• Risk Mitigation With accurate data being funneled regularly, value chain management is aided by complete transparency of the value chain actions through the S&OP platform. Such visibility catalyzes proactivity against unwarranted internal or external disruptions and places an enterprise on the safe shore against financial losses and potential demerits to its brand value.

• Better Customer Service Levels When management reduces missteps on the accounts of inventory management, resource utilization, distributor performance, and product availability, it sees itself elevating its positioning as the customers' go-to brand. The factors above are crucial building blocks toward user retention metrics, which are thoroughly achieved with an S&OP platform.

• Accountability Sales and operation planning software requires all of its stakeholders to be aware of their roles and responsibilities. Apart from giving them decision-making competence for the functions they are handling; an S&OP platform enables the team to be quick with their action plans if any disruptions arise. This is one of many contributions by the titular platform that focuses on the collaboration between automation and the end users.

• Competitive Edge Having the right tools in place allows an organization to adapt and plan for potential challenges quickly. With the market being volatile in nature, having an S&OP application benefits management in overseeing the actual operations (and their current status). Not to mention, the characteristic transparency of the software makes the management take more accountability and plan for the time ahead.

There you go. Management finds itself catalyzing all the good habits that make its supply chain operation efficient, self-improving, and, more importantly, a self-aware mechanism through a Sales and Operation Planning platform.

We all have come across enough headlines that focus on the state of supply chain decarbonization. After all, it does hold the future of the planet. With industries looking to expand and retain their current market share, it is imperative to have that success by doing good for the environment and the inhabitants of this planet. With value chain decarbonization curating the roadmap for zero GHG emission, it is a priority for SCM to manage its one hundred percent efficacy. This is achieved by ensuring the finances required to run the carbon-negating framework are certain.

With decarbonization projects requiring substantial investment and a scalable timeline, leadership is needed to lock the cash flow that will keep the process running till the objectives are met. The return on investment, though higher eventually, does require patience and, of course, proper planning.

To tackle such uncertainty, supply chain management has broken down the eventual ways to source funding for the decarbonization process. In this write-up, we’ll cover the ingenuity the value chain stakeholders have found out to make sure that the carbon-neutral roadmap never stutters. Be it realigning internal operations, managing external stakeholders, or a combination of both, this precedence is indeed worth to be captured. So, let’s dive right in.

• Inventory Management Every process involves capital. More so for the supply chain as it depends entirely on the customer's demand. For management to make the most finance invested without any loss, it needs to ensure that it deploys an analytics-laden platform that gives the production insight to avoid overstocking and stockout. Being mindful of accurate demand enables exact metrics of raw material procurement and production with related factors of the workforce employed. The logistics leg of the value chain also does well if it focuses on the quality of its products. This reduces the chances of product return rate, which saves additional reverse supply chain costs and avoids carbon-related scope emissions.

• Supplier Relations  With raw material procurement driving the first production stage, a leadership team reaches out to local vendors to finalize bulk purchasing at a much more effective rate. With localized suppliers being part of the network, it is also beneficial on sustainable counts as it results in a minimal carbon footprint and opens up more green avenues for both parties involved.

• Improving Transportation Efficiency Delivering final products, if planned well, can save a considerable amount of funds. An intelligent transport management system can focus on route optimization, smart load consolidation, intelligent delivery sequence, and reduced fuel consumption that contributes to saving costs upfront. Logistics management can also find breakthroughs by deploying electric vehicle fleets that not only echo sustainable actions but funnel the retained capital to other avenues of supply chain decarbonization.

• Energy Efficiency Credits Businesses that have actively invested in carbon-neutral projects can showcase their energy efficiency credits (EECs) and renewable energy certificates (RECs) to attract investment from fellow collaborators and businesses to carry on their excellent work. A considerable effort also attracts rebates for businesses from authorities, helping them save money and project it to their sustainable projects.

• Collaboration with Like-Minded Business We often come across news where companies align their common interests for the world's betterment and their ESG goals. In such scenarios, conglomerates usually align their Research and Development teams to work towards a collaborative project or fast-track means that will help the ecosystem.

• Working with Financial Institutions Financial institutions like investment and commercial banks can help companies to raise money for their decarbonization projects. By reaching out to potential investors who back similar projects, finance intermediaries open avenues for businesses to ensure their smooth functioning.

• Crowdfunding If the people at large believe in your commitments and subsequent product offerings made through sustainable methods, then crowdfunding does help the companies, by and large, to attract additional funds. Kickstarter, a crowdfunding platform in the US, helps small-scale project ideas see the light of day by enabling platforms for crowdfunding. Though not suitable for seeking funding for large operations, it can be beneficial for small-level industries.

There you go. These were some distinct ways management looks to accrue funds for its sustainable projects. While these methods require extra effort, they sure keep the faith going toward building a carbon-neutral world for the generations to come.