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Concurrent planning in the age of volatility - exec summary

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JP Doggett

A summary of an online, virtual boardroom discussion with SC Leaders, run under the Chatham House Rule by Intent Group on 30/06/20.

The discussion was chaired by JP Doggett of Intent Group, with input from Claire Milner  and Hans-Georg Kaltenbrunner of Kinaxis. With thanks to David Thomas, former Director, Global Capacity Planning at Ford Motor Company for sharing his experiences of moving to concurrent planning.

“...the key to success is not about who makes the best forecast but about who is best able to respond to developments as they happen...”

Selected highlights:

What is concurrent planning?

The traditional approach to SC & Logistics planning is sequential e.g. collecting demand picture first, then supply & capacity planning perspective, then considering working capital and service level implications to ask whether the plan is feasible or whether we need to go back to sales to change the product mix etc. By the time all of this data is collected and processed, typically 30-days have passed.

Covid has meant that data collected at the beginning of the process has become completely meaningless by the time decisions need to be made.
Concurrent planning enables a view into an organisations entire planning network and aligns data so that a change in one part of your chain triggers corresponding changes and communications in the rest of the chain, in real time. It enables what-if scenarios, enabling organisations to understand their impact on your whole network and assess your options before anything actually happens. 
In times of high volatility with the situation changing almost on a daily basis, you need to be able to run scenarios on-demand. You can’t wait for an MRP weekend run before starting calculations the following week.

Does concurrent planning replace S&OP/IBP or augment it?

It augments it. You would put your S&OP/IBP process within the concurrent planning framework but, if you wanted the same cadence of, say, a monthly planning process that would stay with the same time but, within that month, you have the ability to simulate the changes that are happening so that conversations are based on current data and so more productive.
Concurrent planning is an enabler which adds greater dynamism and agility as it does not rely on using the last sync point of the underlying process.

How should you seek stakeholder buy-in for concurrent planning?

Though it’s vital to get the buy-in of supply chain professionals, shifting the mindset of the wider business through effective change management is central to success. Overall, transforming an organisational mentality is about taking every employee on a journey; communicating the individual value of the changes for them, as well as what it means for the business going forwards. Great technology is only as good as the people using it. If employees aren’t convinced that new solutions will benefit them or their roles, siloed thinking and use of traditional tools such as Excel will continue, even if there are better technologies available.

More available in the S&OP/IBP forums when you sign up / in.

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