Creating Vision

Vision is the starting point in implementing the seven guiding principles for the design of market-savvy S&OP. The first two principles are described in Chapters 1 and 2: “market in” and “segment level.” Vision is a comprehensive understanding of the market segments in the business and the strategy for each segment. With vision developed, the S&OP team members will be able to more fully appreciate the uniqueness of the markets they serve and the requirements for success. A truly collaborative planning process will more naturally flow from a proper vision.

Only at the market segment level is there enough clarity and relevance for you to be able to define a complete and unique vision definition. In turn, value delivery can be defined only by segment, and value delivery is the only way to create competitive advantage, leading to share gains and increased free cash flow. Chapter 1 explains how to create the vision through a new market segmentation process leading to the go-to-market strategy, defining how to create competitive advantage and an action plan for all functional areas for each segment. Chapter 2 describes the framework for the generic strategies from which you can choose, including the revolutionary new strategies of time advantage and customer connectivity.

Throughout the book, we will refer to the diagram shown in Figure PI-1 as a conceptual roadmap. The critical management change step of visioning is accomplished by the group of processes in the upper left, the round objects depicted in the diagram.

FIGURE PI-1. CONCEPT MAP OF MARKET-SAVVY S&OP.

Market-savvy S&OP adds two new process sets to the traditional S&OP: annual segment-level value chain strategies and weekly rate-based planning.